text:
    David J. Lees, as Receiver, etc., et al., Resp’ts, v. Eldin B. Hayden et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Pleading—Countebcl aim—Insolvency.
    A claim against an assignor for creditors, which was not due when the assignment was made, cannot be set off against a claim in favor of such assignor, though, after the former claim matured, the assignment was set aside as in fraud of creditors.
    Appeal" from a judgment entered on a verdict directed by the court in favor of plaintiff.

      Geo. D. Beattys, for app’lts; W. J. Toiunsend, for resp’ts.
   Van Brunt, P. J.

On the 27th of October, 1890, the firm of D. H. Wickham & Co. made an assignment for the benefit of creditors to one Hewwitter. At that time the defendant Eldin B. Hayden was indebted to the firm of D. H. Wickham & Co. for goods sold and delivered. Subsequently, and on the 6th of July, 1891, the said defendant executed and delivered to the assignee the promissory note in suit, for the amount of such indebtedness, payable on demand, which note, when delivered, was indorsed by the defendant Anna K. Hayden. On the 25th of May, 1892, in an action brought by a judgment creditor of D. H. Wickham & Go., the assignment to Newwitter was adjudged to be fraudulent and void, and set aside, and Newwitter was appointed receiver of tiie assets of the insolvent firm, and, as sucii receiver, became possessed of the note in suit. In September, 1892, the receiver made demand for the payment of the note, which was refused ; and the note was protested for nonpayment, of which the indorser had due notice. This suit was originally commenced in the name of New-witter, as receiver. During the pendency of the"action, one Lees was substituted in his place. In the answer the defendants pleaded a set-off, based upon a draft made upon D. H. Wickham & Co., dated October 6, 1890, payable seven months after date, which draft did not mature till long after the assignment, and there is no proof as to when the draft came into the possession of the defendants ; and the question involved is whether the defendants are entitled to set off the draft in question against the claim of the plaintiffs.

It is perfectly clear, under the decision in the case of Fera v. Wickham, 135 N. Y. 223 ; 47 St. Rep. 866, that if this action had been brought by the assignee of Wickham, no right of set off would have existed, because the draft in question was not due until after the assignment had been made. But it is urged upon the part of the defendants that their right to set off has accrued, because such draft became due prior to the time of the commencement of the action for the setting aside of the assignment and the appointment of the receiver. The question as to the rights of the parties, resulting from the failure of proof as to the time when the draft came into the possession of the defendants, does not seem to have been raised by the objection to the admissibility of the draft. The case of Clark v. Brockway, 3 Keyes, 13, is an authority for the proposition that, had this draft become due subsequent to the time of the commencement of the action, it could not have been the subject" of a set-off, because the filing of the bill in equity seeking to set aside the assignment, and asking that all the assigned property, as far as might be needed, should be applied to the satisfaction of the debt of the judgment creditors, created a lien oh all the assigned property in the form of choses in action. And it is there intimated that, the law having transferred the title of the notes from the assignee to the receiver, there was no gap intervening, during which the right to offset could attach. But no such question was involved in that case, and therefore the statement was a mere dictum. That the right to offset depends upon the condition of affairs existing at the time of the assignment seems to be evident, when we consider that a decree entered at the suit of a creditor does not set aside the assignment absolutely, but only so far as it prevents the suing creditor from realizing his debt out of the estate, and that, as between the assignor and the assignee and the creditors not attacking the assignment, it still remains in full force and effect. The result, then, of allowing an offset where the claim had matured between the date of the assignment and the filing of a bill by a creditor would be to take certain of the assets which were properly applicable to the payment of the suing creditor, and compel him to seek satisfaction of his judgment from other assets belonging to the assigned estate. The result, then, would be that, by the allowance of such offset, funds which might otherwise be applied to the payment of the claims of creditors who did not attack the assignment would be diverted; and hence the offset would be virtually allowed against them, notwithstanding the fact of its having matured subsequent to the assignment. It seems to us that no such rule can obtain. Where the debtor of an assigned estate has no right of set-off, as against the assignee, how can he have a right of set-off as against any other creditor of the estate who has acquired a lien upon the assigned property, when the result of such set-off is to compel the creditors of the assigned estate to pay the same ? It would be, perhaps, entirely different, if, by a proceeding of one or two or three creditors against a assignment, such assignment was absolutely wiped out. But it is not. It is only set aside as to the creditors suing. It remains existent and valid as to all others. In this view, it would appear that the right of set-off depends upon the state of facts ^existing at the time the assignment is made, the making of which assignment is the fact which gives the creditor the right to his preference. The judgment should be affirmed, with costs.

Parker, J., concurs; Follett, J., concurs in result.


source: Caselaw Access Project

author: Parker, J.

license: Public Domain

text:
    In the Matter of the Application for the Examination of Charles B. Van Nostrand, etc.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Deposition—Examination of party before trial.
    An affidavit for the examination of a party before trial, if made on information and belief, must recite the facts on which such information and belief are based.
    Appeal from an order denying a motion to vacate an order for the examination of a party before trial.

      Treadioell Cleveland, for app’lt; William Mitchell, for resp’t.
   Parker, J.

The affidavit upon which the order is based, authorizing the examination of Yan Eostrand for the alleged purpose of enabling the affiant to prepare his complaint in an action to be brought by him, is fatally defective, in that it fails to support the allegations made upon information and belief by the affidavit of deponent’s informant, or by assigning a reason for not producing such affidavit, and presenting, instead, the statements made by him to the affiant. From the affidavit it appears that the imformation which pursuaded the affiant to make it was obtained from one McDonald, and an alleged copy of an agreement. The so-called “ agreement ” does not justify the belief expressed, and the remaining source of information is therefore McDonald’s statement to him. But he has failed to furnish to the court any part of the conversation with McDonald. Whether McDonald said anything to justify the impression made upon the affiant’s mind, the court cannot know ; and the authority to inquire into the private affairs of an alleged interested party to an action will not be granted by it until it has such knowledge of the facts as persuades it that the examination is desired solely for the purposes authorized by the Code. The order should be reversed, with $10 costs and printing disbursements, and motion granted, with $10 costs.

All concur.


author: Per Curiam.

text:
    John Henry Hull, Resp’t, v. New York Elevated Railroad Company et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Railroads—Elevated—Release oe mortgage.
    A judgment against an elevated railroad for fee damage to abutting premises will require, as a condition of its payment, a release of the mortgage thereon.
    Appeal from a judgment awarding an injunction unless defendants pay a designated amount as fee and rental damages.

      J. 0. Thomson, for app’lts; J. JT. Hull, in pro. per.
   Per Curiam.

The main question involved in this case is a question of fact,—as to whether the. award was justified by the evidence. We are of opinion that it was, and do not think it necessary to rehearse the evidence, but merely give our conclusion, as derived from the argument and examination of the case. It is, however, claimed that one of the mortgagees was not required by the decree to release the mortgage in respect to the piece of property described in the action which is called “No. 1.” It is urged upon the part of the respondent that such release is not necessary, as« the mortgage in question has become merged. We do not think, in view of the condition of this record, that the defendants should be required to depend upon such merger, but that the decree in action No. 1 should be modified by requiring a release from the mortgage as a condition of payment, and, as modified, affirmed, without costs. In action No. 2 no such question exists, and the judgment should be affirmed, with costs.


text:
    Lackawanna Mills, Resp’t, v. Samuel Weil et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894)

    Contract—Action on—When prematurely brought.
    Where the vendor, upon objection, allows a rebate on the goods delivered, and agrees to alter the portion undelivered so as to comply with the contract, an action, brought before such alterations are made, is premature.
    Appeal from a judgment entered on a verdict in favor of plaintiff, and from an order denying a motion for a new trial.

      B. F. Einstein, for app’lts; A. A. Spear, for resp’t.
   Parker, J.

We think the action was prematurely brought. By it the plaintiff sought to recover damages for an alleged breach of a contract by which the defendants agreed to pay for 60 cases of good on June 10, 1891, the plaintiff on its part having stipulated to have them ready for delivery 10 days earlier, or June 1st. Plaintiff notified defendants, prior to June 1st, that the goods were ready for delivery. Defendants did not make full payment on June 10th, but a little "later—about June 22d—they ordered the plaintiff to deliver to them some of the goods. Thereafter, and before August 5th, four cases were delivered to them. Defendants insisted that the goods were not in accordance with the contract in several respects, one being that the buttons on the garments delivered only had two holes, whereas it was agreed that they should have four. Plaintiff yielded to defendants’ contention regarding the buttons, and agreed to allow to the defendants, because of the error in such respect, $15 a case for each of the four cases delivered, and to substitute buttons with four boles in the place of those on the fifty-six cases of goods then in plaintiff’s factory. In accordance therewith, the plaintiff, by its representative, sent the defendants a check for sixty dollars inclosed in a letter, of which the following is a copy:

“ New Yokic, August 5, 1891.

“Messrs. Weil, Haskell & Oo., New York.

“ Gentlemen : Inclosed please find check for sixty dollars, in settlement of claim ac. of wrong buttons on cases 1,487, 1,486, 1,474 and 1,476, sold by the Lackawanna Mills. The balance of that order shall have buttons as last year, and as per sample from which order was taken. I am,

“Very truly yours, “A. S. Haight.”

Thereafter the plaintiff put buttons with four holes on the remaining garments in place of those then on, but it had not completed the work when this action was brought. Under its contract with the defendants, full performance on its part was to precede payment by the defendants. Its promise to make1 a deduction on account of the goods already delivered, and to change the buttons on the rest, admitted the contention of the defendants in that respect to be true, and denied to it a right of recovery until after it should so change the goods as to make them comply with the contract. The learned trial judge does not seem to have taken a different view of the law governing this contract than we have expressed but his charge would seem to indicate that he had in some way been led to believe that the buttoms had been changed before the commencement of - the action. The evidence is to the contrary. Edward G. Connor, plaintiff’s superintendent, testified, with reference to a call made upon the plaintiff by a Mr. L'unpman, representing the defendants, who presented a letter of introduction from his employers bearing date August 19th, in which they requested for him the courtesy of the plaintiff. The witness said that Lampman called the day following the date of the letter, which would be August 20th. On his cross-examination he testified: “Q. When were those buttons changed ?- A. The girls were working on them at the time that the messenger from Weil, Haskell & Co. was there. Q. When did they finish them? A. Oh, within a day or two after he was there. Q. Do you recollect that? A. Well, I couldn’t say for certain what day they were finished. The Court: He doesn’t ask for certain; lie asked within what time. Q. The letter was dated August 19th. It must have reached you about the 20th. Row, I want to know how long after August 20th was it before the buttons were changed ? A. Well, not over two days. Q. And then they were all completed? A. Yes, sir; didn’t take only about three days to do the whole thing.”

Lampman testified that he arrived at Scranton, where plaintiff's mills were situated, early in the evening of the 19th, and called at the mills on the 20th, and had cases of the goods opened for his inspection. Replying to the question whether the buttons had been changed, he answered, “Ho, sir.’’ This action was commenced on the 19th day of August; necessarily, therefore, several days before the goods were, according to the contract as construed by the parties to it, ready for delivery.

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

All concur.


author: Yah Beüht, P. J.

text:
    The People ex rel. Henry Keteltas, Resp’t, v. Ashbel P. Fitch, as Comptroller, etc., App’lt.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Mandamus—Park award.
    A mandamus will lie to compel the issue of bonds, under chap. 173 of 1885, to pay an award in a proceeding to open a park, where no money has been provided, and the comptroller has refused to issue the bonds,, though authorized to do so.
    Appeal from an order directing a peremptory writ of mandamus to issue.

      David J. Dean, for app’lt; Geo. G. De Witt, for resp’t.
   Yah Beüht, P. J.

Pursuant to an act of 1884, proceedings-were initiated to acquire title to lands for a public park -in the Seventh ward ; and such proceeding was thereupon had that the-report of commissioners was confirmed on the 17th of July, 1893. Certain awards having been made to the respondent for land taken for said improvement, payment thereof was duly demanded on the 18th of Rovember, 1893 ; and it not having been made, and no bonds issued, and no money provided to pay the award, notwithstanding the fact that the board of estimate and apportionment had authorized the, comptroller to issue said bonds, the respondent brought these proceedings against the comptroller to' compel such issue.

It is urged bjr the appellant that the writ of mandamus will not lie, because there is an adequate and certain remedy at law. If such were the fact, undoubtedly the objection would be well taken. But we do not see how any remedy at law can exist, tin-less chapter 178 of the Laws of 1885 is unconstitutional, in so far as it provides that the person in whose favor awards, costs, and expenses may be made and allowed in proceedings to open any street, road, avenue, boulevard, public square or place, park or parkway, shall not have an action at law against the city of Hew York, but may require the officers of said city to raise, as therein provided, the money necessary to enable the comptroller to pay such award, costs, and expenses; such provision seemingly repealing the right to bring an action conferred by § 992 of the Consolidation Act.

It seems also to be attempted to review the action of the commissioners of estimate and assessment; it being claimed that their awards were improper, they not having proceeded in making the same according to the provisions of law. But it is perfectly clear that the point attempted to be raised is not jurisdictional; and though it might have been availed of upon appeal from the order of confirmation, the award cannot be attacked in this collateral proceeding.

It is further urged that under the act in question the duty of the comptroller is due to the mayor, etc.; that he owes no d'uty to the relator, and therefore no mandamus will issue, at the suit of the relator, to compel his action. The express provisions of the Laws of 1885, above referred to, are that the person entitled to the award may require the officers of the city to raise, as therein provided, the money necessary to enable the comptroller to pay the award. The board of estimate and apportionment has done its duty; the comptroller has refused to issue the bonds ; and the relator has a right to the aid of the court, in compelling the comptroller to fulfill the duty which has been imposed upon him. Unless this right exists, the relator is absolutely without remedy to recover the amount which has been awarded to him in lieu of his property which the city is now enjoying. We think that the order appealed from should be affirmed, with costs.

All concur.


author: Van Brunt, P. J.

text:
    Patrick H. Duffy et al., Resp’ts, v. Durant Land Improvement Company, App’lt.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)
    Trusts—Sale op trust property—Notice.
    Notice of application to sell trust property must be served on all persons having an interest in the trust estate.
    Appeal from a judgment in favor of plaintiffs.

      0. J. Hardy, for app’lt; M S. Babcock, for resp’ts.
   Van Brunt, P. J.

This action was brought to recover $1,000 which was paid upon a contract to sell certain lands in the city of Hew York, made by the defendants with one Patrick H. Duffy, representing the plaintiffs, upon the allegation that the title offered by the defendant in fulfillment of that contract was not such as the plaintiffs were bound to accept and pay for. Various objections were raised to tbe title, but in the determination of this appeal it is not necessary to consider them all. The premises in question, belonged to one Charles W. Durant, who died on the 6th of April, 1885, a widower, leaving a last will and testament and a codicil thereto. He left, him surviving, his sons, Frederick C. Durant, Charles W. Durant, Jr., and Howard M. Durant, his daughter Estelle D. Bowers, wife of Henry C. Bowers, and his grandchildren Adele Durant and Victor Durant, children of his son Thomas F. Durant, who predeceased his father, all of whom were living at the time of the trial of this action. Estelle D. Bowers then had issue living,—a son, John M. Bowers, second. By the said will, a power of sale was given to the executors therein mentioned during the lifetime of the testator’s wife. By the codicil this limitation upon the power of sale was eliminated. Such will, after making various devises and provisions for his sons, by the ninth clause gave, devised, and bequeathed a fifth part of the rest, residue, and remainder of his estate unto his son Frederick C. Durant, in trust to safely invest the same in securities therein named, and to apply the income thereof to the sole and separate use of his daughter, Estelle, during her natural life, and upon the death of said daughter leaving issue her surviving, then to pay over to such issue the principal of such share so devised' in trust, to be equally divided between them; and, in case his said daughter should die leaving no issue her surviving, then upon her death he gave the principal of such share to his sons (naming them), to be equally divided between them. By his will the testator gave, devised, and bequeathed a remaining one-fifth of the residue of his estate to the Union Trust Company of New York, in trust for the benefit of his son Thomas F. Durant. The will further provided that upon the death of his son he gave and bequeathed to Adele, daughter of his said son, the sum of $60,000, and to Victor the sum of $40,000, and the remainder of said share he gave to his other children living at the death of said Thomas, equally to be divided between them.1 By his will he appointed his wife, who predeceased him, executrix, and his sons Charles W. Durant, Jr., and Frederick 0. Durant, executors. Objections were filed to the probate of both will and codicil, which were withdrawn in pursuance of an agreement made in June, 1885, between Mrs. Bowers and her three surviving brothers, which in substance provided that Charles should renounce as executor; that Frederick should resign as trustee under the clause above referred to respecting the interests of Mrs. Bowers, in favor of the Farmers’ Loan & Trust Company ; that the division of the testator’s realty should be made between the parties if they could agree upon one; and that Mrs. Bowers, as the owner of an undivided one-twentieth (being a part of tbe one-fifth devised in trust to Thomas F. for life, and then over, as above mentioned), should have the right to bring partition within a specified period. Frederick C. Durant resigned as such trustee, and on the 17th July, 1885, the Farmers’ Loan & Trust Company was appointed in his stead by order of the surrogate. Thereafter, on the 18th of July, 1885, Frederick C. Durant, as executor of Charles W. Durant, the elder, deceased, Charles W. Durant, the younger, the said Frederick C. Durant individually; and Howard M. Durant, executed, for a nominal consideration, a deed to the Farmers’ Loan & Trust Company, as trustee for Estelle D. Powers, purporting to convey an undivided fifth in two lots embraced in the plaintiffs’ contract upon the trust created in the will of Charles W. Durant in favor of his daughter, Estelle D. Bowers. Upon the same day the same grantors executed to Estelle D. Bowers a deed conveying in fee simple an undivided one-twentieth part of the other two lots mentioned in plaintiffs' contract, and upon the same day the same grantors executed to said Mrs. Bowers a deed purporting to convey in fee an undivided twentieth part of the two lots first above mentioned. On the 27th of May, 1887, there was presented to the supreme court a petition of the Farmers’ Loan & Trust Company reciting the facts above mentioned; also, reciting the bringing of a partition suit by Mrs. Bowers to partition the Hew York and western lands; and the litigation connected therewith; the proceedings by the executor to account in the surrogate’s court, and the filing of objections thereto; that the said Estelle D. Bowers was the sole'beneficiary of the trust of which the petitioner was trustee; that the expenses of the litigation threatened great injury to the estate of the petitioner, and that the entire estate was practically unproductive; that said Mrs. Bowers, in the preceding April, agreed with her brothers to settle all matters in dispute between them, upon terms which to the petitioner, seemed particularly to the advantage of the beneficiary of the trust; that among other matters so agreed upon, and as part of said settlement, was that all the lands situated in the city of Hew York, left by the said Charles W. Durant, deceased, and forming part of the lands described in the partition suit, should be purchased by Frederick C., Charles W. and Howard M. Durant at a value of $280,000, paying to said Mrs. Bowers and the petitioner, for their interest, the one-fourth part thereof, namely $70,000 ; that of said sum Mrs. Bowers was entitled to $14,000 and the petitioner to $56,000; and that, in order to carry out such settlement, it was necessary that the petitioner should be granted authority by this court to sell its share or interest in said premises for the aforesaid sum of $56,000. The petition further states that all the other parties interested, who are adults, and capable of the disposing of the same, were agreed that it would be advantageous, and that the three Durant brothers had appointed Richard W. G. Welling to receive, as grantee, the said lands for them at the consideration aforesaid, and concludes by praying the order of the court authorizing the petitioner to make the sale to Welling. Upon this petition, and proof of service on Mrs. Bowers, only, an order of reference to take proof and report with opinion was granted. The referee made his report with an opinion that the order to sell the lands described in the petition to Welling for $56,000 should be granted, and on the 18th of June the order prayed for was made. Tiie Farmers’ Loan & Trust Company on the 20th of June, 1887, made a deed to Richard W. G. Welling of the trust interest. Mrs. Bowers conveyed her undivided interest, Frederick C. Durant, as executor of Charles W. Durant, deceased, also executed a conveyance to Welling, and Frederick C. Durant and wife, as individuals, also executed a quitclaim deed of the same property, and Charles W. Durant and wife, and Howard M. Durant and wife, also executed such deeds, and thereupon Welling conveyed the same premises, by the same description, to Frederick C., Howard M. and Charles W. Durant. In these conveyances Welling paid no consideration, and acted only as the means of transfer of the title to the Durant brothers. Subsequently, the three Durant brothers, on the 9th of January, 1888, conveyed the premises in question to the defendant; and the title offered to the plaintiffs in pursuance of the contract of sale above mentioned was the deed of the defendant.

As has already been stated, there were various objections made to the title, but, in order to dispose of this appeal, it seems only necessary to consider one, and that is, were the proceedings taken by the petitioner in the supreme court such a compliance with the statute as authorized the trustee of Mrs. Bowers to convey ? In the disposition of this question we do not propose to discuss the point as to the authority of the court to grant such an order as was made, because it does not seem to be necessary, in view of the fatal defects which are presented by the proceedings themselves. It is to be observed that the only person who had notice of these proceedings was the life tenant, Mrs. Bowers; and in the petition she is represented as being the sole beneficiary of the trust, the remaindermen being absolutely ignored. By the provisions of the statute (4 R. S. [8th ed.] p. 2439, § 65), under which these proceedings were taken, it is provided that no order directing such trustee to mortgage or sell spell lands shall be granted unless it shall appear to the satisfaction of such court or judge that a notice in writing, stating the time and place of making the application therefor, has been served upon the beneficiary or beneficiaries of said trust at least eight days before making such application, if such beneficiary or beneficiaries are within this state, and adult. In case said beneficiary or beneficiaries are infants, lunatics, persons of unsound mind, habitual drunkards, or absentees, said court or judge shall not direct the trustees to mortgage or sell said lands until such beneficiary or beneficiaries are brought into court by such notice as said court or judge may prescribe. It is therefore imperative, in order that the court shall proceed and make an order for a sale under these proceedings, that every beneficiary of the trust shall have notice that its interests are to be affected by the order made by the court. It is claimed that -the child of Mrs. Bowers was a beneficiary, and no notice of these proceedings was givqn to it. In answer to this objection, it is urged that there was no proof offered to show that this child was not properly before the court; and that, as the statute says that such infant shall be brought into court by such notice as the court or judge may prescribe, it is left entirely within the discretion of the court or judge, and, in the absence of any proof to the contrary, it will be assumed that the court did its entire duty under the statute when the petition for leave to sell was before it, and that, in the absence of direct and positive proof that this infant was not properly brought into court on that proceeding, it will be assumed that the court before which the application was made did give such notice as, in its opinion, was deemed sufficient to protect whatever interests in the matter the infant had. This seems to be carrying the doctrine of presumption very much further than has been done in any case to which our attention has been called. The papers before the court are recited in the order, and it reads: “On reading the petition in this matter, and on proof of due service thereof on Estelle Durant Bowers,- sole beneficiary of said trust,” the reference is ordered. With such a recital, the court adjudging that Mrs. Bowers was the sole beneficiary of the trust, and that she had notice, where is there any presumption that the court directed notice to be given of this application to the child of Mrs. Bowers, of whose existence it was absolutely ignorant? legal proceedings cannot be supported by any such violent assumptions, which are contrary to the express statements in the record.

But it is said that it was not necessary to give notice of the application to any one other than Mrs. Bowers; that it was a trust of a specific portion of the estate to the trustee named, to be invested in securities, the income to be paid over to Mrs. Bowers d uring her life, and, upon her death leaving issue, the trust to be divided among such issue; and by another clause, if she should die leaving no issue her surviving, then the trust fund to be divided among her brothers specifically named; and that, therefore, whatever interest this infant son had in the trust fund was entirely contingent upon his surviving his mother, and he was not, and could not be, a beneficiary under the trust; and we are referred to the case of U. S. Trust Co. v. Roche, 116 N. Y. 120 ; 26 St Rep. 394, as decisive upon this point. That case, however, has no application whatever to the one at bar. In that case it appears that proceedings of a character such as were taken in the case at bar were had, and the children of the life tenant were made parties, out of which originated the mortgage which that action was brought to foreclose. The only surviving son of the life tenant, however, in that foreclosure action, was not made a party, and this objection was taken; but the court held that because he had no legal estate in remainder, vested or contingent, his interest being contingent upon his surviving his mother, and the parties before the court representing the whole vested estate, he was not a necessary party; but it did not decide that he had no interest whatever in the trust estate, and could not come under the head of a beneficiary. . We think it was the clear intention of the statute that all parties who might be ultimately interested in the estate by reason of the provisions of the trust should have notice of the proceelings to affect the interest which they might subsequently have, and that, in the use of the word “ beneficiaries,” the legislature intended to embrace every possible interest. Under these circumstances, therefore, it would appear that the proceed ings in question were defective because of want of notice to par ties in existence who might ultimately be interested, and that the title offered was not such as the plaintiffs were bound to take.

Judgment should be affirmed, with costs.

All concur.


text:
    Peter Walsh, Resp’t, v. John McArdle, as Administrator, etc., App’lt.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Witness—Competency—§ 829.
    In an action against an administrator, the plaintiff cannot testify that he did not have with the intestate a conversation, which was testified to by defendant’s witness.
    Appeal from a judgment in favor of plaintiff.

      Hufus M. Williams, for app’lt; Augustus H. Vanderpoel, for resp’t.
   Parker, J.

The referee to whom the questions relating to a disputed claim of the plaintiff against the estate represented by the defendant were referred out of surrogate’s court found as facts that plaintiff, previous to the time of entering the employment of defendant’s intestate, was receiving a salary of ten dollars a week; that she offered to pay him the same sum if he would enter her service; that he accepted the offer, and performed the services requested from July 4, 1886, to the time of her death, November 19, 1890, making the amount of salary earned by him $1,590; that she paid him on account ten dollars a month during such period, aggregating $580; that, in addition, the estate should be credited with $450.90, which a decree of surrogate’s ■ court had found to be due the defendant from this plaintiff; and, as a conclusion of law, that plaintiff should recover the agreed sum, less offsets, with interest, amounting to $688.57. In passing, it may be said that the finding of the referee to the effect that plaintiff is indebted to the defendant in the sum of $450.90, adjudged by the decree of the surrogate, was in reality founded upon a decree made in a discovery proceeding instituted by the administrator against Peter Walsh (this plaintiff), in which it was adjudged that Walsh, after the death of defendant’s intestate, unlawfully took and carried away from the premises in which she died the sum of $450.90. It further appeared upon this trial that after her death he overhauled her receipts and papers, and burned a few of them, which turn out to have been receipts given by him to her for moneys paid him from time to time. This fact is testified to by two witnesses, who were present at the time when he selected these receipts from among a great number for burning. It is true that he undertakes to deny it, but his efforts in that direction are accompanied by admissions that these parties were with him on the occasion to which they testify, and that he did then burn some papers, which he describes as old newspapers and scraps. The appellant contends that, in view of plaintiff’s conduct in unlocking the receptacle in which the intestate kept her valuables, taking from it bank books, money, deeds, and other useful papers, and his misconduct in destroying the receipts given by him to Mrs. Duffy, thus depriving the defendant of the opportunity to use them in this action, considered in connection with the testimony 'of several witnesses to the effect that they had overheard conversations between plaintiff and defendant’s intestate in which it was asserted by Mrs. Duffy, and not denied by plaintiff, that his compensation was ten dollars a month, with his board, washing, and mending added, and that such conversations had resulted at different times in the payment by her of small sums of money to him, accompanied by a demand on her part and acquiescence on his. that he give a receipt for a month’s salary at the rate of ten dollars per month, the findings by the referee were against the weight of evidence, and for that reason the report and the judgment entered thereon should be set aside. Without determining whether his position in such respect is well taken, we pass to the consideration of exceptions taken to the admission of certain testimony offered on the part of the plaintiff against the objection that it was not admissible under § 829 of the Code of Civil Procedure. In order that the relation which such testimony bears to other evidence in the case may be readily understood, a brief statement of the facts beyond that already given will be made. We have already observed, that the referee found that the plaintiff received his board, washing, and mending, and $10 a month during all the period that he was employed by Mrs. Duffy. It was the contention of the defendant that this sum represented the price agreed upon between them. How plaintiff, in order to establish his claim, called one Alexander MacDonald, who, prior to July, 1886, was, in company with this plaintiff, working for the Metropolitan Express & Van Company. lie testified that he was present at a conversation which occurred between plaintiff and Mrs. Duffy, in the course of which she asked the plaintiff to come and live with, and take care of, her, and she would pay him the sum for wages he was then receiving, and, in addition, “ at her death would leave him all right.’’ The plaintiff testified that he was receiving $10 a week from the company at that time, and other witnesses described the work which they saw plaintiff do for Mrs. Duffy on different occasions. But no witness on behalf of the plaintiff, other than MacDonald, undertook to throw light upon the question in dispute,—as to what was the agreement between Mrs. Duffy and the plaintiff, touching the amount of his compensation. After plaintiff had rested, defendant undertook to show affirmatively that the amount which Mrs. Duffy actually paid the plaintiff, to wit, $10 a month, was the price agreed upon between them as the sum of money to be paid him in addition to his board, washing, and mending. Defendant called several witnesses who testified to conversations which they allege took place between the plaintiff and Mrs. Duffy in their presence; conversations which, if true, make it very clear that the plaintiff received from Mrs. Duffy, from month to month, the sum which she had agreed to pay him. After defendant had rested, plaintiff was called in rebuttal, and was asked whether the specific interviews and conversations to which the several witnesses on the part of the defendant had testified took place, and his answers were received against proper objections and timely exceptions on the part of defendant. The questions and answers following are but typical of others occupying nearly seven pages of the record : Q. On page 65, Mrs. Kiernan testifies that in August, 1887, she heard a conversation between yon and Mrs. Duffy, it being the first conversation that she heard between you, in which you stated you wanted money, and Mrs. Duffy said you were getting $10 a month, and that you were not worth half that. Did that conversation ever take place? (Same objection, same ruling, and exception.) A. Mo. Q. On the same page Mrs. Kiernan testifies that in January, 1888, she was present at an interview when you asked Mrs. Duffy for money, and she refused to give it, saying that she had already given you over and above your wages; and, on the following page, that Mrs. Duffy stated that your wages were ten dollars per month. Did that interview ever take place? (Same objection, same ruling, and exception.) A. Mo. Q. On page 73, Mellie Duffy testifies that she recollected an occasion when a controversy took place between Mrs. Duffy and yourself as to whether Mrs. Duffy owed you any money. Did that interview ever take place ? (Same objection, same ruling, and exception.) A. Mo.” It will be observed that plaintiff was permitted to deny that the alleged conversations between himself and the deceased ever took place. The courts have declared the policy of the statute to be to exclude an interested witness from testifying—First, to any transaction between himself and the deceased, or in which the witness in any manner participated; and, second, to all communications between the deceased and the witness, including communications in the presence or hearing of the witness if he in any way was a party thereto,' or communications to either one of two or more persons if all were interested. Holcomb v. Holcomb, 95 N. Y. 316. The rule is the same whether the object be to prove an affirmative or a negative. The interested party cannot testify that an alleged conversation or an interview concerning the agreement or transaction did not take place, any more than he can testify concerning the conversation. Our attention is called to certain cases which it is contended justify the rulings of the referee, and which it is insisted considerably relax the rigor of the more early decisions, which undertook to apply and enforce the statute. In Pinney v. Orth, 88 N. Y. 447-451, a party to the action was permitted to testify that a witness who liad detailed a conversation which he alleged took place between the interested party and the deceased at a place named was never present at the place specified when any such conversations took place. The court held that it was proper for him to so testify ; that the statute did not preclude the survivor from testifying to extraneous facts or circumstances tending to show that a witness who had testified affirmatively to such a transaction or communication had testified falsely. By way of illustration, the court said that it would have been entirely proper, for instance, for the survivor to have testified that he was at some other place than the city of Mew York where and when the conversation, was alleged to have taken place. But, said the court, the language oí the prohibition is sufficiently broad to prohibit the survivor from testifying that any particular communication or transaction did or did not take place personally between himself and the deceased.” It should be remarked in this connection that the questions put and responses made by the plaintiff amounted to a denial of certain communications alleged to have taken place between him and Mrs. Duffy. Such was their intended purpose and effect. Had defendant’s witnesses been called upon to fix the time and place of the conversation related by them, and then plaintiff, in rebuttal, had been asked whether he was present at the times and places mentioned, and he had answered that he was not, his testimony would have been within the protection of Pinney v. Orth, supra. Lewis v. Merritt, 98 N. Y. 206, was based on Pinney v. Orth. The plaintiff in that action was the executor of his testator, and as a witness in his own behalf testified that he saw certain notes, the possession and ownership of which were in issue, in a box in the room of his testatrix the morning before her death, and that the defendant was in the testatrix’s room "during the day preceding her death, and had opportunity to take the notes from the box without authority. The trial court having refused to permit the defendant to answer the questions (1) whether he had taken the notes from any trunk or any person, and (2) whether at the time of the convei’sation, which was alleged to have occurred two days before the testatrix’s death, and in her presence, “he had possession of the notes,” the correctness of the ruling came before the appellate court for decision, and it was held that it was competent for the defendant to testify that he did not take the notes from the box, and thereby rebut the inference which the plaintiff by his testimony attempted to justify, namely, that he had wrongfully abstracted them. The second question was regarded as much nearer the border line than the first, but it was considered admissible as furnishing an inference on the leading issue, whether the intestate gave the notice to defendant; the court stating, however, that it was not offered for the purpose of establishing an affirmative defense. In the still later case of Clift v. Moses, 112 N. Y. 426 ; 21 St. Rep. 777, the cases already referred to were considered and discussed, but not extended, the court alluding to the fact that in Pinney v. Orth the range of permissible contradiction was confined within such narrow limits as not to include testimony by the survivor of what was or was not said between the parties at a conversation sworn to by a witness produced by the other side, even when offered for the sole purpose of contradicting the witness’ narration of the transaction. The respondent does not call our attention to any cases which he regards as giving stronger support to his contention than those we have referred to, and we think his failure to do so was due, not to his lack of diligence, but to their nonexistence. ■ The courts have not abrogated the construction long ago given to the statute which accords to it the effect of depriving a survivor from testifying that a certain communication or transaction did or did not take place personally between himself and the deceased, although a witness has already repeated the communication and described the transaction. The cases referred to supra furnish seeming, not real, exceptions to the rule. The judgment should be reversed, with costs to the appellant to abide the event, and a new trial ordered before another referee. All concur.


text:
    Robert M. G. Walford, Resp’t, v. Frank C. Harris, Individually and as Trustee, etc., et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Contempt—Order to pay money. ■
    An order to pay money, in a proceeding to enforce the liability of a partner to his co-partner, is within the exception of subd. 4, § 1241 of the Code.
    Appeal from an order adjudging defendant Harris guilty of contempt.

      B. P. Harlow, for app’lts ; II. II. Whitman, for resp’t.
   Van Brunt, P. J.

This action having been commenced, among other things, to obtain an accounting by the defendant Harris, as the attorney in fact of the plaintiff and the defendant Bailey, in respect to the liquidation of certain claims belonging to a firm of which the defendant Harris, the defendant Bailey, and the plaintiff were members, a judgment was entered declaring that the said Harris, in liquidating the affairs of the firm, acted in a fiduciary capacity, and that an application of a certain sum of money to his own use by said Harris was a conversion of the same, notwithstanding that there had been no settlement of the copartnership accounts; and he was directed to pay over the same to a receiver. Not having done so, this application was made to commit him for contempt, which being granted, from the order thereupon entered this appeal is taken.

It is clear that prior to the present Code, in a proceeding such as this, no commitment cquld issue to enforce the collection of a money judgment, but the same must bo by execution. It is undoubtedly true that by the Code, § 1241, the old rule has been modified to some extent. By the fourth subdivision of that section, it is provided that a judgment may be enforced against a party refusing or willfully neglecting to pay it, by punishing him for á contempt of court, where the judgment requires the payment of money into court, or to an officer of the court, except where the money is due upon a contract, express or implied, oras damage for nonperformance of a contract. Therefore, unless the liability sought to be enforced by this judgment comes within the exception, the court had the power to make the order appealed from.

We think, upon an examination of the judgment roll, that it appears that the sole liability which-was to be enforced was that of a partner to his copartner; and such liability arises out of the contractual relations existing between them, and is not of that fiduciary character which was claimed to be established. It is true that by the judgment it was declared to be fiduciary; but, when it appears upon the face of the judgment roll that such is not the fact, the mere calling the relation “fiduciary ” cannot authorize the plaintiff to imprison the defendant. It is sought to liken the case at bar to that of Gildersleeve v. Lester, 68 Hun, 535; 52 St. Rep. 560, affirmed in the court of appeals, 139 N. Y. 608; 54 St. Rep. 929, where a commitment was issued to enforce a judgment compelling a trustee of a corporation to account for the property of the corporation wrongfully appropriated by him, and to pay over the value thereof, in money, to a receiver of the corporation, appointed by the court for that purpose. But that case is not in any respect like the one at bar. The act of the trustee in that case was a grand larceny, and was so held by the court. It did not arise out of any contract, and therefore was not within the exception, and consequently the power to issue the commitment existed. But in the case at bar the defendant has not committed any crime by the retention of this money. He has not embezzled it, lie has not committed grand larceny, and he is only insisting upon his contractual rights. Such being the case, it seems to come within the exception, and the power to issue the commitment did not exist. The order should be reversed, with. $10 costs and disbursements, and the motion of commitment denied, with $10 costs.

All concur.


author: Follett, J.

text:
    Lewis C. King, App’lt, v. John Townshend, Impleaded, etc., Resp’t.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    1. Pleading—Complaint—Action to determine claims to real estate.
    An allegation in the complaint that plaintiff owns the premises “in fee,” is equivalent to an allegation that he is the “ sole owner.”
    2. Same.
    The complaint sufficiently states defendant’s claim, where it alleges that defendant unjustly claims to be the owner in fee.
    3. Same.
    An allegation in the answer that plaintiff was not in possession of the premises, but that they were in the possession of a person holding as the tenant of plaintiff, is not a denial of plaintiff’s possession.
    4. Same—Conclusion.
    An averment in the complaint, in an action to determine claims to real estate, that defendant claims to be the owner in fee of the land, is not an allegation of a conclusion of either law or fact.
    Appeal from an interlocutory judgment overruling a demurrer to a defense in the answer.

      L. A. Gould, for app’lt; John Townshend, in pro. per.
   Follett, J.

The special proceedings for the determination of claims to real property authorized by title 2 of chapter 5 of the third part of volume 2 of the Eevised Statutes were a substitute for the ancient mode of barring claims to real estate by fines .and recoveries (1 Grah. Pr. 2d Ed. 71), authorized and regulated by chapter 58, Rev. Laws 1813, which act was repealed by § 93 of chapter 21, 2 Sess. Laws 1823, and by 2 Rev. St. 343, § 24. McGregor v. Comstock, 17 N. Y. 162. In 1849, § 449 was added to the Code of Procedure, by which actions were authorized to compel the determination of claims to real property, pursuant to the provisions of the Revised Statutes. After the adoption of this section it was held that adverse claims to real estate might be determined by an action or by a special proceeding; that the remedies were cumulative. Burnham v. Onderdonk, 41 N. Y. 425; Fisher v. Hepburn, 48 N. Y. 41. September 2, 1880, chapter 14 of the Code of Civil Procedure took effect, the fifth article of which embraces the substantive law of the Revised Statutes, with some changes in respect to the determination of such claims; and, by § 1 of chapter 245, the provisions of the Revised Statutes were repealed. The substantive law and the law of procedure relating to this subject are now embraced in the fifth article of the first title of the fourteenth chapter of the Code o.f Civil Procedure. It should be borne in mind that this action was begun after article 5, last referred to, was amended in 1891. The substantive law, prescribing cases in which actions may be brought, is contained m § 1638, and the law regulating the procedure and the effect of judgments in such cases is embraced in §§ 1639 to 1646, inclusive; but on the record the questions presented and controlled by §§ 1638-1640, for so far as it appears (only the third defense being printed), the defendant has simply denied the plaintiff’s possession, not his title, and has not alleged title or possession in himself, and could not have a judgment for affirmative relief, as provided in the subsequent sections. The following are the sections referred to: “ Sec. 1638. Where a person has been, or he and those whose estate he has, have been for one year in possession of real property, or of any undivided interest therein, claiming it in fee, or for life, or for a term of years not less than ten, he may maintain any action against any other persons to compel the determination of any claim adverse to that of the plaintiff which the defendant makes to any estate in that property in fee, or for life, or for a term of years not less than ten, in possession, reversion or remainder, or to any interest in that property, including any claim in the nature of an easement .therein, whether appurtenant to any other estate or lands or not, and also including any lien or incumbrance upon said property, of the amount or value of not less than two hundred and fifty dollars. But this section does not apply to a claim for dower; § 1639. The complaint in such an action must set forth facts showing: (1) The plaintiff’s right to the real property; whether his estate therein is in fee, or for a term of years not less than ten; and whether he holds it as heir, devisee or purchaser, with the source from or means by which his title immediately accrued to him; (2) That the property, at the commencement of the action was, and, for the one year next preceding, has been in his possession, or in the possession of himself and those from whom he derives his title, either as sole tenant, or as a joint tenant, or tenant in common with others; (3) That the defendant unjustly claims an estate or interest or easement therein, or a lien or incumbrance thereupon of the character specified in the last section. The complaint must describe the property as prescribed in section fifteen hundred and eleven of this act. The demand for judgment may be to the effect that the defendant and every person claiming under him be barred from all claim to an estate in the property described in the complaint, or from all claim to an interest or easement therein, or a lien or incumbrance thereupon, of the character specified in the last section, or it may combine two or more of said demands with other demands for appropriate relief; § 1640. If the defendant, in his answer, puts in issue the matters specified in subdivision second of the last section, and succeeds upon that defense, final judgment must be rendered in his favor, dismissing the complaint, and awarding to him costs against the plaintiff.”

The defendant invokes the application of the rule that, in case the answer is demurred to, and a cause of action is not set forth in the complaint, judgment should be rendered for the defendant. People v. Booth, 32 N. Y. 397; Clark v. Poor, 73 Hun, 143; 56 St. Rep. 122; Abb. Tr. Brief, § 451., Under this rule, the question first to be determined is, does the complaint state a cause of action? The land in dispute is described, and it is alleged that the plaintiff owns it in fee, that he acquired his title from William Moores and wife by a deed executed January 29, 1890; that when the action was begun, and for one year next preceding, the plaintiff had been in possession of the land,- claiming it in fee. This complaint complies with the first and second subdivisions of section 1639, and it is not necessary, in order to state a cause of action, that the plaintiff should allege in the complaint that he is the sole owner in fee. Sole ownership is fairly implied from the allegations that he is the owner in fee. Ho authority is cited for the position that an allegation that the plaintiff is the owner of commercial paper sued on, that he is the owner of a chattel, or is the owner of a piece of land, is not equivalent to an allegation that he is the sole owner of such paper, chattel, or land. For the same reason, the allegation that the plaintiff has been in possession of the land since he acquired his title is equivalent to an allegation that he has been in possession as sole tenant. The more serious question arises under the third paragraph of the complaint: “3. That the defendant (John Townshend) unjustly claims an estate or interest therein adverse to that of plaintiff, to wit, the adverse claim that he is seized of said premises in fee.”

Upon Austin v. Goodrich, 49 N. Y. 266, and Brown v. Teel, 59 Hun, 91; 35 St. Rep. 507, it was held by the learned special term that the allegation last quoted was not a compliance with the third subdivision of § 1639, above quoted, and that it was necessary for the plaintiff to set out the particulars of the defendant’s claim. The case first cited arose under the Revised Statutes, which, as amended by chapter 50, Laws 1848, provided: ‘‘ Section 1. * * * He (the person instituting the proceedings) may compel a determination upon any claim which any other person may make to any estate, in fee or for life, or for a term of years not less than ten, in possession, reversion or remainder, to such lands and tenants, in the manner and by the proceedings hereinafter specified. Sec. 2. He (the person instituting the proceedings) shall serve a notice * * * on such claimant, stating ;***.”“ Sec. 4. That the person to whom such notice is directed unjustly claims title to such premises.” 2 Rev. St. p. 312, §§ 1, 2, 4.

It was alleged “ that the defendant unjustly claims title to said premises.” The defendant demurred, upon the ground that the complaint did not state facts sufficient to constitute a cause of action. In discussing the question as to whether the allegation “ that the defendant unjustly claims title to said premises ” was sufficient it was stated: “She (plaintiff) can have a right of action against another only when he makes a claim to an estate to such lands or tenements, in fee, or for life, or for a term of years not less than ten. In stating her right of action against him, she must bring him by the averments of her complaint within some of these provisions. He must be shown by them to make a claim to an estate in fee, or for life, or for a term of years not less than ten, to such lands and tenements. Failing to do this, she fails to show any right to bring him into court to assert and make good his claim, or be forever.barred. If he makes claim other than as specified in the statute, and makes no claim as herein specified, she has no right to compel him to assert it and make it good, or be forever barred.”

The demurrer in that case was held good, upon the ground that the plaintiff failed to allege that the defendant claimed an estate “in fee, or for life, or for a term of years not less than ten.” It was not there held or intimated that a plaintiff is required to set out the particulars of a defendant’s claim, but the intimation is that had the plaintiff alleged that the defendant claimed an estate in fee, for life, or for a term of years not less than ten, it would have been sufficient.

In the second case cited, an action under the Code of Civil Procedure, it was alleged that the plaintiff “was the owner in fee simple,” and that “the defendants, who are children and grandchildren of said Elisha Brown, deceased unjustly claim an estate in fee in said premises.” All of the defendants made default, except Teel and Hunn, who separately answered, Teel denying that she had any claim or interest in the land, and Hunn interposing a general denial. On these issues the action was tried on the merits at special term. On the trial, the plaintiff failed to show that either of the defendants had ever claimed any interest in the land. Notwithstanding, a judgment was directed against them, with costs, from which they appealed, not claiming on the appeal any interest, legal or equitable, in the land. The judgment was reversed, on "the ground that the plaintiff failed to prove a cause of action, which was clearly right, and it was affirmed by the court •of appeals. 128 N. Y. 678; 40 St. Rep. 979. Neither of these judgments supports the contention of the defendant. It was not held in either ease that the plaintiff must set forth the particulars of the defendant’s adverse claim of an interest in fee. The allegation that defendant claims to be an owner of the fee of the land is not an allegation of a conclusion, either of law or of facts, but it is an allegation of what the defendant has asserted as a fact. The plaintiff may not know the ground of the defendant’s assertion, which may be exclusively within his knowledge. We do not think it will do to hold that in case A. is in possession of land, claiming to own it in fee simple, and B. asserts, when, where, and to whom he pleases, that he owns the land in fee, without disclosing how he own it, that A. may not, by alleging his ownership and B.’s claim, require the latter to abandon or defend his claim. Should the rule contended for by the defendant be adopted, would the plaintiff be required to state truly all of the particulars and grounds of the defendant’s claim, at his peril? We think that in •such a case the defendant should be required to allege the grounds and particulars of his own defense, and that the burden should not be imposed on the plaintiff. Again, it should be observed tha*- the first subdivision of § 1638 requires the plaintiff to set forth the source of his title, and qualitytmd quantity of his estate, and whether he acquired it by descent, by devise, or by grant, but the third subdivision does not require such particularity in respect to the defendant’s claim. The requirements of the two subdivisions are quite different, and rest upon the theory that the plaintiff knows the particulars of his estate, but may not know the particulars of the defendant’s claim. The sections of the Code are well pleaded. Rothschild v. Rio Grande Western Railway Co., 45 St. Rep. 809; 18 N. Y. Supp. 548. The complaint states a good cause of action.

The facts stated in the third division of the answer to which the demurrer is taken do not constitute a defense. The defendant alleges that John Hughes, the plaintiff’s tenant, is in possession of the premises. It is a familiar rule that the possession of the tenant is the possession of the landlord. The defendant’s contention is that the owner of land in fee which happens to be in the possession of his tenant cannot maintain an action to determine the validity of an adverse claim to it, and that a plaintiff must be actually in the personal possession of the disputed land before he can maintain such an action. The Revised Statutes provided that a proceeding might be maintained by a person in “actual possession,’ which language was incorporated in the Code of Civil Procedure, and there remained until 1891, when the word “actual” was stricken out, which was done to obviate the very objection now raised by the defendant. Under the Code as it now stands, a person in possession of land, by his tenant, may maintain an action to compel the determination of an adverse claim to it. We are asked to order a final judgment against the defendant on this appeal. This we cannot do, for the whole of his answer is not contained in the record, and he may have interposed some good defense to the action. The interlocutory judgment should be reversed, and the demurrer sustained, with costs in this court and at the special term. All concur.


text:
    Charles M. Ward, App’lt, v. New York Life Insurance Company, Resp’t.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Deposition—Discovert and inspection.
    An examination of defendant’s books will not be granted until plaintiff establishes his right to a recovery, where it would be a great hardship to defendant in case it should be finally determined that plaintiff had no such right.
    Appeal from an order denying a motion for the inspection and discovery of defendant’s books before service of the complaint.

      J. M. Mitchell, for app’lt; W. B. Hornblower, for resp’t.
   Van Brunt, P. J.

It will not be necessary, in the disposition of this appeal, for this court to pass upon the question as to the rights of the parties, arising out of the discharge of the plaintiff from the employment of the defendant, because a discussion of such rights might lead to conclusions as to the views of this court upon the merits of this action, which might be modified, had it. tne facts before it, as they may be established upon the trial. It is evident that there is no absolute right upon the part of this plaintiff to have an inspection of the books of the defendant in order that he may frame a complaint with more particularity than he would be able to do without such an inspection; and where it is apparent that such an inspection .would be a great hardship, if it should be finally determined that the plaintiff has no right of recovery, an order of that description should not be granted, unless the same is absolutely necessary to the framing of the plaintiff’s complaint. In the case at bar, the first issue which is presented is as to the right of this plaintiff to any relief whatever; and, until that is determined, it would seem that this extreme right of inspection of an adversary’s books should not be granted. The plaintiff in this action may allege his rights in such a form that, upon.establishing his right to a recovery, he would be entitled to an accounting; or he may assert his rights by such a complaint as that the court would have no power, as matter of right, to compel an accounting by an interlocutory judgment. It seems to us, however, that absolute justice will be done between the parties if we place them in such a position that, if the plaintiff establishes his right of recovery, an opportunity to get the evidence which be now seeks will be given him. We think, therefore, if the defendant stipulates that it will consent that the issues which are raised by the plaintiff’s complaint and its answer may be referred, in case the plaintiff so desires, that the order appealed from should be affirmed, because, upon a trial in such a forum, the question of the plaintiff’s right to recover can be first determined; and, if it is held that he has such right, facilities for proving the amount of his claim bv the defendant’s books will be within his reach. We adopt this method of disposing of the appeal the more readily because it is apparent that it will be impossible to try the issues involved before a jury if the plaintiff succeeds in maintaining his right to a recovery. Upon the defendant giving the stipulation in question, the order appealed from should be affirmed, with $10 costs and disbursements.

All concur.


text:
    Emily Talbot, App’lt, v. The New York and Harlem Railroad Company et al., Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Injunction—Bbtdge.
    An injunction will not lie against a railroad company to enjoin the maintenance of a bridge over its tracks, where such bridge is under the exclusive control of a city.
    Appeal from a judgment dismissing the complaint on the merits.

      Aug. S. Hutchins, for app’lt; Henry H. Anderson, for resp’ts.
   Follett, J.

This action was brought to restrain the defendants from maintaining a bridge in Forty-eighth street, spanning their tracks and Fourth avenue, and also from maintaining the approaches and walls appurtenant to said bridge. Forty-Eight street is one of the public streets of the city of New York, laid out in 1837 pursuant to chapter 86 of the Revised Laws of 1813, and the acts amendatory thereof and supplementary thereto. An assessment was levied upon the premises now owned by the plaintiff, to aid in defraying the expenses of opening this street. The street is 60 feet wide between house lines; 10 feet on each side being used for walks, and about 40 feet in the center for a carriage way. The fee of this street is in the city. The plaintiff is, and since March 1, 1869, has been, the owner of No. 25 East Forty-Eighth street, which is on the north side of the street, and is 16 feet .8 inches wide, and 100 feet 5 inches deep. This lot is bounded on the south by the north line of Forty-Eighth street, and the plaintiff has no title to or interest in the bed of the street, nor any private rights therein, except such as are incident to the ownership of a lot abutting on a public street in the city of New York. This lot is 250 feet west of Fourth avenue, and 633 feet east of Fifth avenue. The defendants have since about 1875 owned all of the land lying between the plaintiff’s lot and Fourth avenue. In 1870 the plaintiff erected on her lot a four story brick house, with a brownstone front, which she has ever since occupied as a dwelling. For many years prior to 1869 the tracks of the New York & Harlem Railroad Company had extended north from Forty-Second street, through and on the surface of Fourth avenue, to the Harlem river. May 14, 1872, chapter 702 of that year was passed, which is entitled “ An act to improve and regulate the use of the Fourth avenue in the city of New York.” This statute provides: “ Section 1. The New York and Harlem Railroad. Company is hereby authorized and required to regulate the grade of their railroad in the Fourth avenue of the city of New York, and to construct such viaducts, foot and road bridges over the same, and such excavations and tunnels under the same, with openings for proper ventilation, for the purpose of rendering the same safe and convenient to any persons crossing the same, and the railroad trains and passengers traveling thereon, in the following manner, namely: At Forty-Fifth and Forty-Eighth streets, to construct tunnels under the said streets and the Fourth avenue for sidewalks and carriage ways underneath the railroad at least thirty-four feet wide, or bridges over the railroad of at least that width, for the same purpose. * * * Between Forty-Fifth and Fifty-Ninth streets, including said streets, iron railings or brick walls shall he erected in said streets outside of the railroad tracks, so as to prevent crossing at a level with said railroad tracks.”

By the sixth section of this law a board of engineers was created, charged with the duty of directing and superintending the construction of the improvement. The section provided that the board should consist of Allan Campbell and Alfred W. Craven, or their successors, and the chief engineer of the board of public works of the city of New York for the time being, and the engineer of the New York & Harlem Railroad Company. By the seventh section of the act, it was provided that the railroad company and the city of New York should each pay one-half of the expenses of the proposed improvement. On the 30th of June, 1872, the hoard of engineers appointed by the act directed the construction of an iron bridge over the tracks of the railroad at Forty-Eighth street, instead of a tunnel under the tracks, and prescribed the plans and specifications of the bridge to be erected, including the approaches thereto During the years 1872 and 1873, this bridge was constructed pursuant to their plan, was afterwards inspected by the board of engineers, and found to have been built in accordance with their specifications; and one-half of the expense was paid by the railroad, and one-half by the city. The approach of the westerly end of the bridge begins in the street, on a line with the east line of the plaintiff’s lot, and ascends, upon a grade fixed by the board of engineers, until it meets the bridge spanning the avenue. This bridge is 34 feet wide, and is on the south side of the street, leaving a space about 26 feet wide, on the north side of Forty-Eighth street, which is unoccupied by it. For the purpose of preventing teams and persons from passing over this unoccupied part of the street on to the tracks of the railroad, a brick wall about eight feet high was extended from the southeast corner of plaintiff’s house to the bridge proper. The grade of the street in front of the house was not changed, but the wall above mentioned prevents carriages from being driven exactly in front of the plaintiff’s door, and also prevents the plaintiff from using that portion of Forty-Eighth street lying east of the wall, and west of defendant’s tracks. April 1, 1873, the New York Central Railroad Company leased the road of the New York & Harlem Railroad Company, since which time it has operated the same as lessee. The railroads make no use of this bridge, which is part of Forty-Eighth street, and is wholly within the control of the city of New York. The court found that the bridge does not injuriously affect the easements of light, air, or access appurtenant to plaintiff’s premises, except as it slightly interferes with the approach of a carriage to the front of the house. It is found that the brick wall extending from the southeast corner of plaintiff’s house to the side of the bridge casts a shadow in the early morning on the front basement room of the plaintiff’s house, but that later in the day the reflection trom the wall increases, rather than diminishes, the light in the basement. The undisputed evidence shows that, since the bridge and its approaches were constructed, they have been used as part of Forty-Eighth street, and that the city paid for paving the approaches, and lighted and controlled the entire structure; the defendants making no use of it, and exercising no control over it. The city had the right, under the statute referred to, to substitute an over or under crossing for the dangerous grade crossing which existed at this place in 1872, and for many years prior thereto, and incurred no liability to this plaintiff in making the change. None of her land was taken, nor was the grade of the street in front of her lot changed. As before stated, the bridge does not entirely close Forty-Eighth street, so as to prevent persons and carriages from passing along the north side of the west approach, and entering on the tracks of the railroad. The city, having provided an over crossing, had the right to close the grade crossing, which it did by the wall extending from the southeast corner of the plaintiff’s lot to the north side of the west approach. The learned counsel for the plaintiff does not question the right of the city to close the grade crossing by a proper barrier, but he insists that it should have been built 250 feet east of the plaintiff’s lot, and on the west side of Fourth avenue; thus leaving a narrow cul-de-sac, 250 feet long, bounded on the south by the west approach of the bridge, on the east by a wall, and on the north by the north line of Forty-Eighth street; The defendants own all of the land north of this proposed cul-de-sac, and between plaintiff’s lot and Fourth avenue; and they consented that this part of the street should be closed, and, as against the plaintiff, the city had the right to close it at the point where the wall was built. A cul-de-sac of the kind described would have served no useful purpose would have been difficult to guard, misleading to travelers, and a useless source of expense and danger to the city. Hnder the 'act the city had authority to substitute an over or under crossing for the existing grade crossing, which necessarily carried with it the right of closing the grade crossing as it had previously existed; and in doing this the city was not required to place the barrier on' the west side of Fourth avenue, but might place it at such place in the street as would best subserve the public interests, without liability for damages, so long as the property of the abutting owners was not taken or encroached upon. Whatever the city had the right to do in respect to constructing this bridge and its approaches, it could authorize these defendants to do; and they are under no greater liability for carrying out the plans of the board of engineers than the city, had it undertaken the work. Bellinger v. N. Y C. R. R. Co., 28 N. Y. 42 ; Uline v. N. Y. C. & H. R. R. R. Co., 101 N. Y. 98, 108; Conklin v. N. Y, O. & W. R. R. Co., 102 N. Y. 107, 112; 1 St. Rep. 677; Bucholz v. N. Y., L. E. & W. R. R. Co., 66 Hun, 377; 50 St. Rep. 670. The case at bar is quite different from Reining v. N. Y., L. E. & W. R. R. Co., 128 N. Y. 157; 40 St. Rep. 392; affirming, 35 St. Rep. 731; 13 N. Y. Supp. 238. Reining’s premises were on the north side of Water-street, and. on the west side of Commercial street, at the northwest corner formed by the intersection of those streets. The defendant built, in Water street, an embankment 24 feet wide and five feet high, supported on both sides by' perpendicular stone walls, and on this embankment laid and operated two railroad tracks. Between Reining’s lot and the north Wall of the embankment there was a space of about 8 or 9 feet in width, which formed the only means of approaching the premises. This use of the street was wholly for the benefit of the railroad, and not at all for the benefit of the street, or the citizens living near or on it. It was held that the use of the street was so exclusive as to be unreasonable, and that the plaintiff was entitled to damages. In the case at bar the change was not wholly for the benefit of the railroad, but was believed to be, and clearly was, for the benefit of the public as well. The defendants made no use whatever of Forty-Eighth street, except to cross it.

It is urged that because it appears that the defendants have occupied, to some extent, the narrow strip of land east of the wall, and north of the bridge, formerly within the bounds of the street, the plaintiff is entitled' to have such use restrained. This action was not brought or tried on that theory. The use of this strip seems to have been by the assent or acquiescence of the city, and such use is not set out in the complaint as a cause of action; and the evidence that any injury to the plaintiff’s lot was caused by it is so slight that it is entirely insufficient to justify an injunction restraining the use.

It is very clear that the defendants do not own the bridge, its approaches, or the wall, and have no right to remove them, and that a judgment against these defendants, commanding them to remove the structure complained of, would be unavailing. Without considering the effect of the statute of limitations, or the other questions involved, we think the evidence failed to establish a cause of action, and that the judgment should be affirmed, with costs.

All concur.


text:
    Miles M. O’Brien et al., as Receivers, etc., App’lts, v. Ronald T. McDonald et al., Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed May 18, 1894.)

    Bills and notes—Contbact.
    No recovery can be had on notes given in pursuance of a contract, without showing performance of such contract, though illegal or ultra vires, or unless the contract is rescinded and the maker put in statu quo.

    Appeal from a judgment dismissing the complaint.

      Louis Marshall, for app’lts ; W. B. Putney, for resp’ts.
   Van Brunt, P. J.

This action was brought to recover upon two promissory notes made by one Ronald T. McDonald to the order of the Ft. Wayne Electric Company, and indorsed by said company, and, thus indorsed, delivered to the Madison Square Bank, of which the plaintiffs are receivers. There is no dispute as to the facts established by the evidence; the controversies arising as to the deductions to be drawn therefrom. It appears that prior to January 27, 1891, the Madison Square Bank had taken proceedings to increase its capital stock, and to issue and sell the same; and the bank requested the defendant Ft. Wayne Electric Company to purchase a certain amount of such increased stock, to wit, 1,000 shares. Negotiations were had, which resulted in an agreement that said defendant company should buy said 1,000 shares of stock at $150 per share, in consideration of the bank making, a certain agreement in writing, as follows: “This agreement, made this 27th day of January, 1891, by and between R. T. McDonald, of Fort Wayne, Indiana, and New York, party of the first part, and the Madison Square Bank, of the city of New York, a corporation organized under the laws of the state of New York, party of the second part, witnesseth, that in consideration of the discount by the party of the second part of three promissory notes of the party of the first part, each for fifty thousand dollars ($50,000) and interest, and each payable in six months from the date hereof, made payable to, and indorsed by, the Fort Wayne Electric Company, the said party of the first part agrees to, and does, at the time of the execution hereof, deposit with the said party of the second part bonds of the Louisiana Electric Light Company, a corporation organized and doing business in New Orleans, in the- state of Louisiana, to the amount, at par, of two hundred thousand dollars ($200,000,) with interest coupons thereto attached, as collateral security for the payment of said notes, and for notes which may be given in renewal therefor, upon the following terms and conditions, to wit: The said bonds are a part of an issue of bonds amounting to $600,000, and the party of the second part is to have the right to sell and pledge bonds, or any number thereof, at any time while said notes, or notes given in renewal therefor, shall be outstanding, and shall account for the proceeds in such sale to the extent of ninety per cent. (90 per cent.) of the face value of the bonds sold, and no more. After having sold said pledged bonds the said party of the second part shall have the right at any time while this contract remains in force, and not fully performed, to sell other bonds of the same issue then owned and held by the party of the first part at and for a price or sum not less than ninety per cent. (90 per cent.) of their face value; and in such case the party of the second part shall account for the proceeds on the bonds so sold to the extent of ninety per cent. (90 per cent.) of their face value; and in consideration of the premises the party of the second part agrees that the party of the first part shall not be called upon to pay his said notes until said two hundred thousand dollars ($200,000) pledged bonds have been sold, otherwise than by giving renewal notes therefor, from time to time, as the notes held mature; the party of the second part agreeing to accept such renewal notes for said one hundred and fifty thousand dollars ($150,000), from time to time, until said pledged bonds shall have been sold or mature. The party of 'the second part is to recei ve the interest on pledged bonds so long as it shall hold the same, and apply said interest on account of said notes. It is further agreed that the party of the first part shall also have the right to effect the sale of said pledged bonds at any time, but in such case the party of the second part is to receive the proceeds thereon, and apply the same, as far as required, in payment of said discounted notes, or notes given in renewal therefor.”

And in consideration of its discounting for the said company the three notes mentioned in said agreement, and payable under and pursuant to the terms thereof. Thereupon, and as part and parcel of the transaction, the said company delivered to the bank, together with the said three notes, each for $50,000, bonds of the Louisiana Electric-Light Company, of the par value of $200,000, as and for security for the payment of said notes, or the notes which were to be given in renewal therefor, in accordance with the terms of the contract first above set forth. Thereupon, said bank credited the said Ft. Wayne Electric Company with the proceeds of said notes; and a draft or check was made by -said company, as against said credit, and in favor of the bank, for said $150,000, the purchase price of said shares of stock, and the stock was thereafter delivered to said Ft. Wayne Company. The bonds in question have never been sold. The defendants gave, and the bank received, renewal notes, down to December 1893,—the date of the maturity of the note set forth in the complaint,—when the defendant tendered new renewal notes, which- w'ere refused by the plaintiffs. It further appeared that no money ever pased between these parties in respect to this transaction, and that on the 9th of February, 1891, the transaction was reported to the board of directors of the bank at a regularly called meeting, and by it formally approved; and it was further ordered at this meeting that the bank’s counsel should examine this agreement, as to its legality. At a meeting on March 9, 1891, a communication was presented from the bank’s counsel in response to the resolution passed at the meeting of February 9, 1891; and a resolution was introduced that McDonald be requested to amend his agreement so that the loans made to him be in conformity with the counsel’s recommendation, and that the maturity of the loan be fixed at some reasonable and definite period. The notes were renewed from time to time, and the old notes surrendered; the board of directors not passing upon the renewal before the renewal notes were executed, but approving of the same afterwards. Upon this state of facts the court held that no right of recovery, as to the notes, existed in the plaintiffs, and dismissed the complaint, and from the judgment thereupon entered this appeal is taken.

It is urged that the burden of proof rests upon the defendants to establish the execution of a valid contract whereby the defendants became entitled to a renewal of their obligation to the bank until such time as the bonds of the Louisiana Electric-Light Company pledged as security could be sold at 90 per cent, of their face value, and that the contract was not authorized by the directors of the bank, and was therefore ineffectual as an agreement to extend the time of payment of the indebtedness owing by the defendants to the plaintiffs. In regard to these propositions, it seems to be sufficient to say that the bank came into possession of these obligations upon the part of the defendant by virtue of that contract. They came into possession of those bonds, which they have ever since the date of the contract held, and upon which they have collected the interest: and neither the bank nor its receivers have made any effort whatever to rescind the contract, and place themselves upon what legal rights the transaction might give them, independent of the obligations arising out of the contract. The notes being the offspring of the agreement, connected therewith, and forming part and parcel of the same transaction, the rights and obligations of the parties to the notes, as between themselves, are regulated by the terms of the agreement; and these plaintiffs cannot enforce one part of the contract, viz. the notes, and be relieved from the obligations of another part of the contract, viz. the paper which is styled the “Agreement.” It is a familiar principle that papers forming part of the same transaction must be read together. Hence, when the question as to the liability of the defendants upon the notes is to be determined, it must be gauged, not only by the contents of the notes themselves, but of the agreement of which they formed a part. The makers and indorsers of these notes entered into an agreement with this bank, by which the latter received the notes. If that agreement was illegal, or beyond the power of the bank to make, then the only way in which the bank can escape its obligations under the agreement is to rescind the same, return that which they have received in pursuance thereof, and place the parties in the position in which they were before the agreement was made, or at least offer to do so. But the receivers of such bank—representing the bank—claimed to hold all that they got under the agreement, and all the rights which the contract gives to them, without being bound at all by the obligations entered into upon the part of the bank. We do not understand, even where a portion of a contract in ultra vires, that a corporation can recover upon that portion of the contract which they claim to be within their powers, and repudiate the balance as ultra vires. The same reasoning will apply to the further claim that, assuming the alleged contract to he authorized by the directors, it nevertheless has no binding force upon the plaintiffs, since the contract, as made, is contrary to public policy. The most that such a condition of affairs, even if it existed, would give to the bank, would be the right of rescission ; and. as has already been observed, there has been no attempt to rescind, and they are now seeking to enforce a part of this very contract, which, according to their claim, is obnoxious to public policy. This reasoning also applies to the claim that the contract was illegal, and that m consequence thereof the plaintiffs are entitled to the immediate payment of the money received by the defendants, as money had and received by them for the use of the bank, and can enforce the notes in suit, given as security for such indebtedness, without regard to the terms of the agreement pleaded in the answer. As suggested by the court below, this is not an action for money had and received, but an action upon the notes, and the plaintiffs can only succeed by reason of the validity of these notes. They have chosen to place their right of recovery upon these notes ; and no matter what ultimate rights the bank may have, unless they are entitled to recover upon these notes by reason of the provisions of the notes themselves, no re covery can be had in this action. As already demonstrated, no right of recovery exists upon these notes, because they are part and parcel of a contract which the bank has not fulfilled, which contract, if illegal, the bank has not attempted to rescind, but has retained all that it received under it, arid now proposes, while claiming to be relieved from its own obligation, to enforce the obligation of the other party to the contract. No such rule of law has as yet obtained in this state. The claim made that there was some misrepresentation in regard to the amount of the issue of the bonds, a part of which .were pledged, rests upon precisely the same fonndation. If the bank claims to be relieved because of such misrepresentation, -which is not entirely apparent upon the face of the contract, certainly, they might have had the right to rescind, or to sue for any damages sustained by reason of such misrepresentation. But they have done neither. They simply proposed to compel these defendants to keep their part of the contract, without being bound, as already stated, by the terms of the contract in respect to their own obligations. We think, therefore, that the court below was entirely right in dismissing the complaint in this case, and, furthermore, that the rights of the parties do not depend upon the question as to whether the transaction in regard to this money was a mere matter of bookkeeping or not. That may be a matter of importance when the question as to the rights of these receivers comes up in a different form.

The judgment should be affirmed, with costs.

All concur.