text:
    James W. Gerard, Resp't, v. Frank W. Cowperthwait, App'lt.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    Bohds—Evidence.
    In an action upon a bond in the penalty of $10,000, made by defendant to plaintiff, which recited that B. was indebted to plaintiff in the sum of $40,000, and to secure the same B. had taken out a life insurance policy for that amount, payable on his death to plaintiff, and defendant agreed for one dollar to pay the premium on said policy, the obligation to become, void if he did so, it appeared that defendant n.ade default in paying the premiums and the company issued a paid-up policy to plaintiff of $3,150. Plaintiff proved that a paid-up policy for $40,000 would cost at least $19,-■000. The answer averred that the bond was made without consideration, and had never become a legal obligation, and defendant offered to prove that it was delivered upon the oral agreement by plaintiff that he would forbear to take any legal proceedings against B. for the enforcement of his indebtedness, and that such was the only consideration. Plaintiff had taken judgment against B. Held, that the evidence was properly excluded, and a verdict for $10,000 directed for plaintiff.
    Appeal from an order denying a motion for a new trial made ■after a verdict directed for the plaintiff by the judge upon the trial of an action by the court with a jury.

      Putney d? Bishop, for app’lt;

      II. Kattell, for resp’t.
   Bookstaver, J.

This action was brought upon a bond given by the appellant, which, after the formal parts, recited that one William Boswell was indebted to the respondent in the sum of $40,000 and upwards, and that in order to secure the payment of that sum, Boswell had applied for a policy pf insurance to the Equitable Life Assurance Society for $40,000, payable on his death to the respondent, and further recited that, “ Whereas, the above bounden Frank H. Oowperthwait has agreed, and does hereby agree, in consideration of the sum of one dollar to him in hand paid, the receipt whereof is hereby acknowledged, to pay the premiums of insurance on the said policy as the same may become due from time to time.” The condition of the bond was that if the appellant should pay the premiums upon the policy as they became due, then the obligation should be void.

A number of defenses were set up in the answer, but upon the trial the appellant rested his defense solely upon the ground that the bond was given upon condition, and in consideration, that the respondent would forbear to take or avail himself of any legal proceedings againat Boswell for the enforcement of any rights or remedies which he had against him by reason of his indebtedness to respondent or by reason of any matter relating thereto. After the respondent had rested, the trial judge, entertaining the opinion that such matters constituted no defense to the bond, permitted the defendant to make offers of proof instead of calling witnesses. Whereupon the defendant offered to prove that at the time he made and delivered the bond, the plaintiff, upon his part, agreed orally that if the defendant would make and deliver to him such bond, he would forbear to take or avail himself of any legal proceedings against Boswell for the enforcement of any rights or remedies which he had against him by reason of the indebtedness of Boswell to the plaintiff, or any part thereof, or by reason of any matter relating thereto. He also offered to prove that the plaintiff agreed that he would forbear so long as he, the defendant, continued to pay the premiums mentioned in the bond. He also offered to show that the agreement stated in the last two offers was the only consideration given for the bond. He also offered to show that, at the time of the delivery of the bond, no money consideration was given. He further offered to show that, before default made in the payment of premiums, the plaintiff entered up a judgment against William Boswell for the sum of $41,356.36, and docketed the same; the judgment being one entered upon confession. The evidence under each of these offers was rejected, and the defendant excepted. The court then directed a verdict for $10,000, with interest from March 17, 1891, and declined to instruct the jury that they were to take into consideration the paid up policy received by the plaintiff, and also declined to charge that the plaintiff could recover in the action only the amount of premiums in default at the time of the enforcement of the action.

Upon this appeal the respondent contends that the questions intended to be presented to the court should not be considered, because they are raised by exceptions to the exclusion of offers merely, and are not based upon testimony actually offered and excluded. While it is quite true that this court will not, as a rule, review exceptions taken to mere offers, yet an inspection of this case convinces us that the offers were made in absolute good faith and for the purpose of facilitating the business of the court and with its sanction, to which the respondent did not at the time raise any objection ; hence we think that in this particular case we are justified in departing from the rule, and should determine the case upon the exceptions as if they had been to testimony actually offered and excluded.

At common law the want of consideration might be shown to defeat a recovery on all executory instruments not under seal, whatever might be the recitals contained therein. Anthony v. Harrison, 14 Hun, 198, affirmed 74 N. Y., 613. By the R. S., title 3, part3, chapter 7, article 8, § 77, orig. ed., it was provided that “ In every action upon a sealed instrument, and where a set-off is founded upon any sealed instrument, the seal thereof shall only be presumptive evidence of a sufficient consideration, which may be rebutted in the same manner, and to the same extent, as if such instrument were not sealed.” But in Calkins v. Long, 22 Barb., 97, it was held that this only applied to actions and set-offs founded on the sealed instrument. This rule of law was extended by § 840 of the Code of Civil Procedure, which provided that “ a seal upon an executory instrument hereafter executed is only presumptive evidence of a sufficient consideration, which may be rebutted as if the instrument were not sealed.” Indeed, before the passage of this provision of the Code, and as far back as 1836, in the leading case of McCrea v. Purmort, 16 Wend., 460, it was decided that the consideration clause in a deed, that is, the clause acknowledging the receipt of a certain sum of money as the consideration of the conveyance or transfer, was open to explanation by paroi proof; and in that case it was decided that although the consideration in a deed conveying land was expressed to be money paid, it"could be shown by paroi evidence that the consideration instead of money was iron of a specified quality valued at a stipulated price. And under many decisions since then it has been established beyond controversy, that the consideration clause of an executory contract may always be inquired into whether under seal or not. The only difference between written contracts as far as the consideration clause is concerned being that where they are under seal there is presumption of consideration which may be rebutted or overcome; but if the contract is not under seal, then the plaintiff must affirmatively establish the consideration aliunde the writing. Vanderbilt v. Schreyer, 91 N. Y., 399; Home Ins. Co. v. Watson, 59 id., 390; Best v. Thiel, 79 id., 15; Presbyterian Church v. Cooper, 112 id.; 517; 21 St. Rep., 503; Parkhurst v. Higgins, 38 Hun, 113.

But it is also as well settled, and just as fundamental and familiar a rule of law in this state, that if a paper appear on its face to be a complete contract, then, in the absence of fraud, accident or mistake, paroi evidence is inadmissible to enlarge its terms, the conclusive presumption of law being that such paper embodies the entire agreement of the parties, and whether or not the writing upon its face be a complete expression of the parties is for determination by the court. Lamson Con., &c., v. Hartung, 45 St. Rep. 50; S. C. reargued, 46 id., 191; Harrison v. McCormick, 89 Cal., 327; Thomas v. Scutt, 127 N. Y., 133 ; 38 St. Rep., 692; Eighmie v. Taylor, 98 N. Y., 288; Dent v. S. S. Co., 49 N. Y., 390; Seitz v. Machine Co., 141 U. S., 510. In the latter case, Fuller, Oh. J., stated the rule as follows: “Undoubtedly the existence of a separate oral agreement as to any matter on which the original contract is silent, and which is not inconsistent with its terms, may be proved by paroi, if, under the circumstances of the particular ease, it may properly be inferred that the parties did not intend the written paper to be a complete and final statement of the whole of the transaction between them. But such an agreement must not only be collateral, but must relate to a subject distinct from that to which the contract applies; that is, it must not be so closely connected with the principal transaction as to form a part and parcel of it. When the writing itself upon its face is concluded in such terms as import a complete legal obligation without any uncertainty as to the object and extent of the engagement, it is conclusively presumed that the whole engagement of the parties and the extent and manner of their undertaking was reduced to writing.”

The question, therefore, to be determined in this case is whether the offers made by the appellant upon the trial related to the consideration of the instrument merely, or whether under color of inquiring into such a consideration it was really intended to add another term to the contract itself, and one which, if established, would render the writing imperative. On looking at the instrument it is apparent that it contains every essential of a complete undertaking to do a specific act without any other condition than that expressed therein. It recites the indebtedness of Boswell to Gerard, and declares that the object of procuring the policy of insurance was to secure the payment of that indebtedness ; and the appellant undertook, in consideration of the sum of one dollar to him in hand paid, the receipt whereof was acknowledged, to pay the premiums of insurance on the policy as the same became due from time to time.

It is manifest, therefore, that the appellant knew of the indebtedness, and knew that the obligee had a perfect right at any time to pursue all legal methods, civil or criminal, for the enforcement of his just debt. If he had intended to pay the premiums only in case the obligee forbore to exercise his legal rights, it is clear that, he should have made that a condition of his agreement and not rested upon a paroi promise of the obligee not to pursue his legal remedies. To permit him to show that now, would be to introduce a new term in the agreement between the parties, and that as appellant himself contends, in order to render it completely inoperative. We think the offers savored much more of an attempt to import a new condition into the instrument, than to show the consideration thereof. That this is so, we think will be clearer from an illustration: Suppose that A. desires to provide for the support of B., a widow, during life or widowhood, and, to this end, enters into an agreement in writing with C. that he will pay a certain sum monthly for the support of B. during life. If B. should thereafter marry, could it be contended that A. could show by paroi that one of the terms of the contract was that he should only pay C. during widowhood ? But in the case under consideration the appellant undertakes to pay the premiums upon the policy upon Boswell’s life as they fall due, and the only condition he provides for in the bond to render it inoperative is that he shall pay or cause to be paid to the insuring society the just and full sum of the amount of any premium or premiums which may become due at any time or times thereafter. If the defendant desired to render the instrument void upon the condition that the obligee was not to take legal proceedings, then he ought to have so provided in the condition or in the recitals or other part of the bond. But such a condition is nowhere hinted at, and we think the offers were, therefore, properly excluded. Cocks v. Barker, 49 N. Y., 110; Worrall v. Mann, 1 Seld., 229; Gilbert v. N. A. F. Ins. Co., 23 Wend., 43. In Wilson v. Deen, 74 N. Y., 531, which, was an action brought by a lessee and her surety against a lessor to obtain the cancellation of the lease, which contained no covenant as to additions to the furniture, which was known to the lessee when she signed it, and which the lessor, upon the execution of the lease, promised to complete, but neglected to do, the court refused to cancel the lease, and Rapallo, J., in rendering the decision, said: “ Both at common law and in equity, one who sets his hand and seal to a written instrument, knowing its contents, cannot be permitted to set up that he did so in reliance upon some verbal stipulation made at the time relating to the same subject and qualifying or varying the instrument which he thus signs,” citing Coon v. Knap, 8 N. Y., 405.

As before shown, either party is at liberty to show for any purpose, except to prevent its operating, whether the writing is under seal or not, that its consideration was different, greater or larger than that named in it, or not wholly or at all pecuniary, in a suit by the vendor against the vendee to recover the actual consideration agreed to be paid, or in a suit brought by the vendee against the vendor on the covenants of a seizin or against incumbrances. Bingham v. Weiderwax, 1 N. Y., 514; Barker v. Bradley, 42 id., 320. Where a receipt is part and parcel of a contract, it cannot be contradicted to defeat the contract itself. Wood v. Chapin, 13 N. Y., 517. And in McCrea v. Purmort, supra, it was held that a mere receipt can be inquired into, because it is only evidence of the fact of payment; but where the acknowledgment of a receipt of the consideration is part of the instrument which is used to prove a right vested, created or extinguished, no evidence can be admitted which will prevent the operative effect of the contract. See also, Halliday v. Hart, 30 N. Y., 474; Marsh v. McNair, 99 id., 180; Hinckley v. N. Y. C. R. R., 56 id., 429; Engelhorn v. Reitlinger, 122 id., 76; 33 St. Rep., 275. In Marsh v. McNair, supra, it was claimed that a certain assignment was in fact given as collateral security for an indebtedness, but it was held that in the absence of any claim of fraud or mutual mistake as to the contents of the assignment, the plaintiff was concluded thereby, and oral evidence was incompetent to show that it was executed as collateral security merely. And in the course of his opinion, Bari, J., said: “It is believed that no case can be found where paroi evidence has been received for the purpose of showing that such an instrument was given merely as collateral security and not for the precise purpose mentioned in it.” (Citing cases.) And in Coon v. Knap, supra, it was held that a receipt may be explained as to the consideration part when the explanation is not ■contradictory to, but consistent with the instrument When a receipt is in the nature of a contract, it falls within the general rules applicable to contracts.

In a number of the cases cited by the appellant, there was either no consideration expressed in the instrument itself, or the seal was relied upon as importing a consideration, or a guarantee or other matter was incorporated into another instrument, but not essential to the validity of that instrument, as in Vanderbilt v. Schreyer, 91 N. Y., 392. Parkhurst v. Higgins, 38 Hun, 113, was an action to foreclose a mortgage conditioned for the payment of a sum of money which was stated in the mortgage to be for the purchase money of the premises described therein; this statement was found to be without foundation in fact, and it was also found that at the time of the execution of the instrument there was an agreement that it should have no validity or effect and should never be collected. These facts were proved by the declarations of the parties, and the question upon the appeal was whether or not such declarations were properly admitted in evidence, and the judgment was upheld upon the ground that they were, and we do not think it touches the question under consideration. Presbyterian Church v. Cooper, 112 N. Y., 517; 21 St. Rep., 503, related to a subscription paper to pay off the mortgage debt of a church. So far as appears from the report of the case, the instrument was not under seal and nowhere in the course of the opinion is that fact discussed or even alluded to.

We, therefore, think the learned judge who tried the case below committed no error in excluding the testimony offered by the appellant, and that he properly directed 'judgment is favor of the plaintiff.

But even if the offers had been accepted, the only breach of the condition which might possibly have been established by them which was attempted to be shown, was that after the bond had been executed and certain premiums paid, the plaintiff docketed a judgment against Boswell for the sum of $41,356.36 upon the latter’s confession. This confession was the act of Boswell and not of the respondent, and it may be well questioned whether such an act would have amounted to a breach of the condition if established.

But appellant contends that even if judgment was properly directed in favor of the plaintiff, it was for too large an amount, and should have been for the sum of $1,458.40 only, being the amount of the premium which became due March 17, 1891. But the bond was conditioned upon the appellant’s “ paying the amount of any premium or premiums which may become due at any time or times hereafter upon the above mentioned policy within the time required or to be required by the rules of said society ; should the said William Boswell comply fully with all requirements and com ditions of said policy of insurance, then the above obligation to be void, otherwise to remain in full force and virtue.”

This was an entire contract of which there was a total breach by reason of the non-payment of the premium, and, therefore, full and final damages are recoverable. Schell v. Plumb, 55 N. Y., 592. In that case the contract was to support plaintiff during her life, and the court said, “ that was a continuing contract during that period, but the contract was entire, and the total breach put an end to it and gave plaintiff the right to recover an equivalent in damages, which equivalent was the present value of the contract.” Shaffer v. Lee, 8 Barb., 412, was cited in that case, where there was a bond to furnish obligee and wife with necessary meat during their lives, wherein it was held there was an entire contract and a failure to provide caused a total breach, and that full and final damages might be recovered for the future as well as the past. See also, Dresser v. Dresser, 35 Barb., 573; Wakeman v. Wheeler & Wilson Manfg. Co., 101 N. Y., 205.

In this case Oowperthwait agreed to pay the premiums on the policy of insurance described in the bond when they became due. He failed to pay the March premium, and the policy, in consequence of that failure, lapsed and was void. Ho premium could become payable thereon at any time thereafter. The breach of the contract on his part was of necessity total, and the plaintiff must recover in this action his full and final damages. Besides, the loss of the policy was the natural and approximate result of the failure of the appellant to pay the premium. Had he done so the policy would now be alive, it became inoperative on his failure to pay the March premium. In such case the damages are the value of the policy. People v. Security, etc., Co., 78 N. Y., 125. The appellant had full knowledge of the special circumstances affecting the question of damages, and that his breach would cause the policy to lapse; and we must, therefore, infer that the contract was entered into upon the basis of these facts, and that the parties had contemplated them in fixing the amount of the damages defendant was to pay at $10,000. Booth v. Spuyten Duyvil Rolling Mill Co., 60 N. Y., 487; Grindle v. Eastern Express Co., 67 Me., 317. The direct consequences of a breach of contract are always compensated, and here they were the loss of the policy. Eten v. Luyster, 60 N. Y., 252; Starbird v. Barrows, 62 id., 615; Devlin v. The Mayor, 63 id., 25; Ward v. N. Y. C. R. R., 47 id., 32.

The value of the policy at the time of the default was such sum as it would cost to replace it; hence the exception to the question, “ What would have been the charge for a paid up policy of $40,000 on the life of Boswell at that date? ” was not well taken, and as the answer shows that it wras much larger than the amount of the verdict directed, the appellant was not in any way injured thereby even if it were erroneous. The instrument is not one of indemnity, but a bond by which the defendant bound himself to do certain acts, to wit, to pay premiums on the policy as they should become due. To such a bond non damnificatus cannot be pleaded. Gilbert v. Wiman, 1 Comst., 550; Rector, etc., v. Higgins, 48 id., 532; Seligman v. Dudley, 14 Hun, 186; Belloni v. Freeborn, 63 N. Y., 383; Kohler v. Matlage, 72 id., 266.

The court did not err in refusing to deduct the amount of the paid up policy from the verdict directed against the defendant, as after the deduction the damage to the plaintiff was much more than the entire face of the bond.

The order appealed from should be affirmed, with ten dollars costs and disbursements.

Halt, Oh. J., and Bischoff, J., concur.


source: Caselaw Access Project

author: Booicstaver, J.

license: Public Domain

text:
    In the Matter of the Assignment of Charles Magnus for the benefit of creditors to Henry W. Steinheauser.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    1. Assignment for creditors—Death of assignee—Substitution.
    One M. made a general assignment for the benefit of creditors to S., who accepted and filed his bond, and after settling with all the creditors except 0., died, and his widow, his executrix, was substituted in his place as assignee. Thereafter, upon the petition of C., and upon the return of an order to show cause, the special term vacated the order appointing Mrs S. as substituted assignee, appointed one G. assignee, and a referee to state and pass the accounts of S. Held, that the court had no power to make the order requiring Mrs. 8., as executrix, to account for the property of the deceased assignee in her possession, and that the order should be vacated, and a new order made substituting Mrs. S. in place of S. as assignee.
    3. Same.
    Chapter 185, Laws of 1883, which provides that upon the death of a trustee, etc., the trust estate shall not descend to the next of kin or personal representatives, but shall vest in the supreme court, and shall be executed by a person designated by that court, has no application to assignments for the benefit of creditors, and applies only to express trusts which are set forth in Rev. St., 8th ed., 2437, § 55.
    Appeal from an order made at a special term of this court vacating an order made by the court at special term, removing Mary 0. Steinheauser as substituted assignee, etc.

      Abram Kling, for app’lt.

      Franldin Bien, for resp’t.
   Booicstaver, J.

On or about the 25th November, 1890, Charles Magnus made a general assignment for the benefit of his creditors to Henry W. Steinheauser, who duly accepted the trust, and the assignment was on the same day filed in the office of the clerk of the city and county of New York. Steinheauser duly filed his bond in the sum of $50,000, as fixed by the court, and entered upon the discharge of his duties as such assignee; thereafter Magnus entered into a composition agreement with his creditors, or most of them, in and by which they agreed to receive and accept sixty-five per cent on the dollar of their indebtedness, in full satisfaction of their demands ; and at a meeting of creditors, where the composition agreement was executed, Charles Cottier, respondent in this action, was appointed one of a committee of three persons who recommended the creditors of Magnus to accept the said sum and discharge him from their respective claims, and at that meeting all the parties present agreed to the terms of the composition agreement; Cottier Bros, were tendered their amount under the agreement but refused to accept the same or to sign the agreement, claiming, as we gather from the papers, that a larger sum had been paid to certain of the creditors.

Their claim is now in action in the city court, in which action they seek to recover $600.87, but which the assignee claims amounted to only $189.56, and he also interposed as a defense the composition agreement, and the acceptance of the same by Cottier Bros., and the tender of the amount alleged to be due and owing under the terms of the agreement. It also appears from the papers in this case that an action was instituted in this court by Magnus against one John Mason, to recover the sum of $12,411 for goods sold and delivered, in which respondent’s counsel appeared as attorney for the defendant; and that judgment was obtained in that action on the 3d day of December, 1891, for the sum of $14,146.77, which was affirmed by the general term of this court, and thereafter an appeal taken to the court of appeals which is still pending; and during which appeal said Henry W. Steinheauser died. That for the purpose of having that case heard in the court of appeals, Mary C. Steinheauser, as the executrix and legal representative of Henry W. Steinheauser, deceased, made an application to the court of appeals that she as executrix be substituted as the plaintiff and respondent in that action, and during the pendency of that motion she applied at a special term of this court for an order that she be made substituted assignee in the place of Henry W. Steinheauser, which was granted and this order was submitted to the court of appeals, but the motion was denied by that court on the ground that an executor could not be substituted as plaintiff in that action, but only as substituted assignee. On the 14th October, 1892, one of the judges of this court made an order to show cause upon the petition of the Cottiers why the order of the 30th September, 1892, substituting Mary 0. Steinheauser should not be vacated and set aside, and why she should not account for all the property of the assigned estate which had come into her possession as executrix of Henry W. Steinheauser and which she may have received as assignee for the benefit of creditors of Charles Magnus; that the Cottier Bros., in their petition, set forth that their claim is for the sum of $600.87, but admit that a set-off is claimed thereto to the amount of $411.31, leaving an admitted balance of $189.56 due them; they also allege in their petition that the said Charles Magnus has been declared a lunatic, and his wife, Cora L. Magnus, appointed as committee of the person and property, and that no notice of said application of said Mary C. Steinheauser to be appointed as substituted assignee was ever served upon them.

It also sets forth that on or about the 17th October, 1892, they instituted an action in the supreme court against the assignor and assignee for an accounting, and that the time to answer in the said action was extended by the attorney of the plaintiff from time to time, and has not yet expired. It also appears that Mary C. Steinheauser was willing and ready to deposit the amount of the alleged indebtedness to the petitioners with this court, or furnish any bond required for the performance of her duty as substituted assignee, and also to obtain the consent of any person interested in the estate that she be substituted as such substituted assignee, which the court apparently failed to consider. It also appears that upon the application for the order made on the 30th September, 1892, nearly all the creditors had compromised the amount of their respective demands, and the court directed that the service of the order to show cause be made upon the estate of Charles Magnus only.

The order of the 11th Hovember, 1892, vacated the order of the 30th September, 1892, and removed Mary C. Steinheauser as substituted assignee in place and stead of her husband, Henry W. Steinheauser, the deceased assignee, and appointed another in her stead as substituted assignee, and appointed a referee to state and pass the accounts of Henry W. Steinheauser, deceased. In this,, we think, the court erred. By the Laws of 1877; chap. 466, § 10,. it is provided, “ in case an assignee shall die during the pendency of any proceeding under this act, or any time subsequent to the filing of any bond required therein, his personal representative or successor in office, or both, may be brought in and substituted in such proceeding on such notice, of not less than eight days, as the county judge may direct to be given; and any decree made thereafter shall bind the parties thus substituted, as well as the property of such deceased assignee, provided, however, that if such assignee die subsequent to the filing of his bond and before any proceedings may have been had thereunder, then the surety on such bond may apply to the county judge for an accounting, who-may, on such terms as to him seem just and proper, appoint another assignee and release such surety.”

Under the common law, where an assignee or trustee died, his legal representative was always appointed in place and stead of the decedent as- the proper party to close the trust, De Peyster v. Ferrers, 11 Paige, 13; Dias v. Brunell, 24 Wend., 13, and by the express provisions of the act before quoted the personal representative of a deceased assignee must be brought in and substituted in such proceeding in the place of the assignee, as having the custody of the property of the deceased trustee; and the only exception provided for under that act, where such personal representative may not be appointed, is where it appears that subsequent to the filing of the bond, and before any proceeding had been had thereunder, the surety may apply for the appointment of a new assignee. Hence if proceedings have been taken, it follows that the right of the-surety to ask for the appointment of a new assignee is barred. This right of the personal representative to be substituted in the place of the deceased assignee has been determined by the-courts of this state upon the theory that the personal representative, having the custody of the property of the deceased trustee, is the only person who is able to account for the same. In the Matter of Grove, 64 Barb., 526; aff’d 53 N. Y., 645, it is true that another person was substituted in the room of the deceased assignee, but the court held that the administratrix was the proper party brought in the proceeding for the purpose of the accounting for the trust estate held by the deceased assignee. And in the People v. The Commissioners, etc., of Brooklyn, 105 N. Y., 674; 8 St. Rep., 179, the court held that in a special proceeding the legal representative of a deceased, who was his widow, was entitled by reason of her interest in the estate, in which she may be charged with liability, to be substituted in such proceedings, and have them continued. In Boone v. Citizens' Bank, 84 N. Y., 83, the court held that, upon the death of a trustee, the right to demand and receive the trust fund devolved upon his administrator, and he became successor in law to the deceased as the trustee, who held the same subject to the same trust as his intestate and predecessor in the trust had held it. In the Matter of Wiley, 119 N. Y., 642; 29 St. Rep., 787, the court held that, upon the death of a guardian, executor or administrator, his representatives stand in his place for the purpose of closing the estate.

Our attention has been called in the supplemental brief, for which no leave was given by the court, to chap. 185, Laws 1882, which provides that upon the death of a trustee, etc., the trust estate shall not descend to the next of kin or personal representatives, but the trust, if unexecuted, shall vest in the supreme court with powers, etc., and shall be executed by a person designated by that court. This act was passed after § 10 of the assignment act, but, we think, has no application to assignments and applies only to express trusts which are set forth in § 55, R. S. (8th ed.), '2437. It also appears that express trusts as to personal property, 4 R. S. (8th ed.), chap. 2, 2516, have reference to the ex.press trusts mentioned, and have no reference to proceedings under the assignment laws. But even where the courts may appoint a new trustee, in such cases that power rests in the supreme court, and does not lie in the court of common pleas.

In this proceeding the court below has directed that the executrix, as personal representative of the deceased assignee, shall not be a party to this proceeding, and notwithstanding such order, has directed that she shall account for the property of the deceased •assignee which may have come in her possession; but if she is not a party to this proceeding, and holds this property as executrix of her decedent, then the court below had no power to make this order, for, as executrix, she is only required to account after a lapse of eighteen months in proceedings instituted in the surrogate’s court.

The respondent claims that Mrs. Steinheauser should not in any event have been appointed the substituted assignee in place of her husband, because she is a woman. It is quite true that this court has been very careful not to take the bond of a married woman in assignment cases if it could be avoided ; but it has frequently had cases where women, and indeed married women, have been assignees.

It was also contended on the argument that Mrs. Steinheauser should not have been made substituted assignee, because certain of her husband’s charges may be disputed upon the accounting, but this is only what happens continually in the cases of assignees, •and she will be put in no more hostile position to the creditors than is always the case when such questions arise.

It is, therefore, clear that the order of Rovember 11, 1892, •should be vacated and set aside. But it is also clear that the order of September 30, 1892, having been made without notice to any of the creditors or the surety, and on a notice of less than eight days, and without providing for any bond to be given on the part of the substituted assignee, should not be restored to vitality. Under the circumstances, all the parties in interest being before this court, we think it is proper that a new order should be made substituting Mary C. Steinheauser as assignee in the place and stead of her deceased husband upon her giving a bond to be approved by one of the judges of this court in the sum of $30,000. 3STo costs of this appeal to either party.

Bischoff and Pryor, JJ., concur.


author: Bookstaver, J.

text:
    Henry Hyman, Pl'ff, v. Anna Hauff et al., Def'ts.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

      1. Mortgage—Priority—Extension of time.
    Parties to a mortgage may, by agreement, extend payment without losing priority over inferior lienors.
    3. Same—Advances.
    A mortgage to secure further advances, which, on its face, gives information enough as to the extent and purpose of the contract, so that any one interested may, by ordinary diligence, ascertain the extent of the incumbrance, whether the extent of the contemplated advances be limited or not, and whether the mortgagee be bound to make the advances or not, will prevail over supervening claims of purchasers or creditors, as to all advances made within the terms of such mortgage, whether made before or after such claims arose, or before or after the mortgagee had notice of them.
    3. Same—Surplus moneys.
    The court has power to direct an unsuccessful claimant in proceedings brought for the distribution of surplus moneys to pay the referee’s fees and disbursements.
    Appeal by James Rogers, a claimant, from an order made at special term, confirming the report of a referee, directing the distribution of surplus moneys, and also charging him with the expenses of the reference.

      Thomas A. Rogers (Vedder Van Dyclc, of counsel), for app’lt,
    Rogers; Tallmadge W. Focte, for resp’ts,
    Lee et al; Thomas O. Fnnever, for resp'ts, Cassidy and Adler.
   Bookstaver, J.

J.—In December, 1890, Muller & Hauff, the owners of seven lots of land, subject to mortgage, commenced to construct seven buildings thereon. They first made a mortgage to the plaintiff to secure moneys to be advanced upon the buildings as they progressed. Then they made contracts with various parties for furnishing materials and work upon the houses, among others, first, with the Lorillard Brick Works Co., for supplying brick ; second, with the Buffalo Door & Sash Co., for supplying woodwork and trim; third, with Cassidy & Adler, for plumbing ■ work, and fourth, with Michael McCormack, for plastering. To secure these contracts, they made their bonds to each for the amount of their several contracts, and gave mortagages upon the buildings to be erected to secure the same. The mortgages were recorded in the order of their making. On this proceeding, each of these claims was proved and found by the referee to be due; and the sole question raised on this appeal is whether or not the defendant Rogers had a right to share with the Buffalo company and with Cassidy & Adler in the $4,000 balance of surplus remaining in court after payment under the order of October 26, 1892, of the costs of reference, and $12,200 to the Buffalo Company, and $4,596.02 to Cassidy & Adler, on account of their claims.

The facts relating to this question are as follows: The Buffalo' company’s mortgage was dated December 16, 1890, and was recorded December 22, 1890 ; it was given, nominally, to secure a. bond of even date, but, in reality, to secure their contract with Muller & Hauff, for payment of doors, sash and other trim for the seven houses ; the contract provided that the company was to be paid the amount of the contract in seven payments, the first; second, third, fourth and fifth of which were to be $1,100 each in cash, when materials to' the amount of said payment should have-been delivered, and the sixth by a payment of $4,700 in cash, on or before March 16,1891, and the further sum of $6,500 on a bond and mortgage upon three of the completed houses when the proposed permanent loan was secured, whereupon the mortgage under-consideration was to be cancelled.

The seventh clause of this contract contained the following provision : “ It is further agreed that in case any lien or encumbrance of any kind shall be filed or docketed against or placed upon the said premises, or any part thereof, during the performance of this contract, the parties of the first part may, at their option, cease to deliver materials hereunder, and unless such lien or encumbrance shall be discharged of record within ten days, the said bond and mortgage shall thereupon become due and payable to the extent of the materials which shall then have been delivered.”

The claim of the appellant is based upon two mortgages for $1,500 each, given by Muller & Hauff, to Michael McCormack, to secure the payment for materials and work to be furnished and performed by McCormack on the mortgaged premises, which mortgages were assigned by McCormack to Rogers by an assignment recorded February 20, 1891, one of which covered the easterly seventy-five feet of the premises out of which the surplus-arose, and the other the westerly 100 feet of said premises. The first of these mortgages contained the following clause: “ Subject, however, to prior mortgages covering the said premises and the four lots on the westerly side thereof not exceeding in the aggregate the sum of $144,700;” and the second containing the following clause: “ Subject,however, to prior mortgages now thereon, which mortgages also cover the three lots on the easterly side of said premises, not exceeding in the aggregate the sum of $144,-700.” At the time of the execution and delivery of these mortgages, the premises" affected thereby were subject to mortgages amounting in the aggregate to $139,700 on the three houses- and lots, and $143,700 on the four houses and lots, being less by $1,000 than the amount mentioned in the McCormack mortgages. After proceeding for a time, the Buffalo company suspended deliveries under their contract because of the filing of certain liens against the premises and declined to proceed further until those-liens were subordinated to theirs. Thereafter all of these lienors, including McCormack, signed an agreement subordinating their liens-to the Buffalo company’s mortgage, hut at that time his mortgage had been assigned to Bogers, the appellant herein, and the assignment duly recorded. The referee finds as a fact that the Buffalo company thereafter duly performed all the conditions of the contract on their part and carried it to completion.

But appellant contends that, notwithstanding this, inasmuch as at one time there had been a determination on the part of the Buffalo Company not to continue the contract, that by reason thereof the McCormack lien came in ahead of what was done after that time. The first answer to this is, that no one but parties to the contract can take advantage of a breach of condition, and the rights and liabilities are confined to them and their privies. The well recognized exceptions to this rule which permits strangers to have standing in court, do not cover this case. Lawrence v. Fox, 20 N. Y., 268; Gibert v. Peteler, 38 id., 165. When such stranger does not change his position, and his rights as originally existing have not been prejudiced by a breach of the conditions of such contract, he will not be heard to complain of such breach when the party for whose benefit the covenant was made chooses not to take advantage of it.. But even if the junior encumbrancer has such a stand as to the contract as to raise this question, still the finding must be against him, because both McCormack and Bogers are precluded from raising it, for the reason that the McCormack mortgages assigned to Bogers were in terms taken, given and transferred subject to the Buffalo Company and the Cassidy & Adler liens, amounting in the aggregate to the sum of $24,200 ; for, as before stated, the McCormack mortgages contained a claim subjecting them to prior mortgages not exceeding $144,700, which includes the two before mentioned. And this, we think, must be regarded as an express assent to the lien of these two mortgages, independently of the subsequent agreement of subordination. Besides, the McCormack mortgage was made and filed subsequent to the Buffalo Company’s and Cassidy & Adler mortgages. In any event there was an actual waiver by Muller & Hauff of any election to call the principal or any part of the Buffalo. Company’s mortgage due; they alone had the right to elect "whether or not the Buffalo Company’s mortgage should become due on cessation of delivery, and if this election had been made, they had a right to waive such election, and having done so, the subsequent mortgagees cannot complain. This being the case, there can be no doubt that the owners of the equity'of redemption would have been estopped from raising the claim now made by Bogers, and we think if it is estopped by it, as he is privy with Muller & Hauff, he also will be estopped. Parties to a mortgage may, by agreement, extend payment without losing priority over inferior lienors.

In Jones on Mortgages, 4th ed., vol. 1, § 373, the learned author says: “ notwithstanding all the distinctions and refinements which have been introduced into the law of this subject by the many conflicting adjudications upon it, there is strong reason and authority for the rule that a mortgage to secure further advances, which on its face gives information enough as to the extent and purpose of the contract, so that anyone interested may, by ordinary diligence, ascertain the extent of the encumbrance, whether the extent of the contemplated advances be limited or not, and whether the mortgagee he hound to make the advances or not, will prevail over the supervening claims of purchasers or creditors, as to all advances made within the terms of such ' mortgage, whether made before or after the claims of such purchaser or creditor arose, or before or alter the mortgagee had notice of them.” Pomeroy in his Equity Jurisprudence, § 1199, citing the cases of Witczinski v. Everman, 51 Miss., 841, and other cases, says that; “ they maintain the mortgagee’s supremacy and preserve the lien of his mortgage against intervening subsequent encumbrances, even for advances made after receiving actual notice of such encumbrances. This conclusion is based upon the doctrine that the executory agreement of the mortgagee creates a full and perfect lien in equity effectual against all persons who are charged with notice thereof, and that the record of the mortgage furnishes such a notice affecting all subsequent encumbrances.” And in a note to the same section he says : “ I would venture to express the opinion that they are based upon the true principle, and formulate the-correct doctrine involved in and derived from the general accepted construction of the American recording acts.”

Indeed, any other rule would work inextricable confusion where there were several mortgages for future advances on the same property, each containing a provision for allowing the mortgagee to discontinue his advances at his option, for the contention in such cases would be changed from the time of making and recording the liens 'to when the goods were actually delivered, and one would have to keep an account of the day, hour and minute of each delivery, and we would have a cart-load of doors and sashes take precedence over a cart-load of brick, or vice versa, and so on throughout the entire time of the performance of the contracts. This would be intolerable, and would keep the courts constantly busy settling such controversies between rival claimants.

But again, neither Bogers nor McCormack changed their position on the faith of the -conduct of the parties at the time of, or subsequent to the alleged discontinuance or election, nor were their rights in any way prejudiced thereby, as they intended to and did take subject to the Buffalo Company’s lien as well as the Cassidy & Adler lien to their full amounts respectively.

Finally, it appears that McCormack in April, 1891, entered into an agreement with the Buffalo Door & Sash Company, subordinating his two mortgages to theirs. It is claimed, however, that this agreement was of no effect, because at the time it was made McCormack had already assigned his two mortgages to Bogers, the claimant herein, and they were then held by him. The Buffalo Door & Sash Company, however, had no actual notice of this assignment, and the record of the assignment was not notice to them. Ackerman v. Hunsicker, 85 N. Y., 43. The assignment, moreover, was not absolute, but as collateral security. The agreement, therefore, with McCormack subordinating his mortgage to theirs, he being the apparent owner of the mortgages and the equitable owner as well, and the Buffalo Boor & Sash Company having no notice of the assignment to Rogers, was binding. Besides, the priority of the McCormack mortgage is technical, and has no equity to support it. Every dollar of advance made by the Buffalo Company under their mortgage was in material which actually went into the construction of the buildings upon the mortgaged premises and increased their value, as must have been contemplated by McCormack when he took his mortgages subject to the prior mortgages. The advances made by them, therefore, actually produced this surplus as far as they went, and equity requires that such surplus should be applied to repay those advances rather than to pay a claim subsequent in date, inferior in legal rank and which has no superior equity to commend it.

Rogers specifically appeals from that portion of the order which directs him to pay to Cassidy & Adler $563.62, the amount of the referee’s fees and disbursements: This it had power to do. Lawton v. Sager, 11 Barb., 349; Bevier v. Schoonmaker, 29 How., 411-422; Hall v. MacDonald, 105 N. Y., 667; 8 St. Rep., 910. There is no opinion as to this last case, but it was an order affirming the order of the general term of this court which directed the unsuccessful claimant to pay expenses of the reference.

In this case if the appellant is not charged with the costs of the contest before the referee, we will in effect charge the successful party with the costs of the litigation, which would be inequitable.

The order should, therefore, be in all respects affirmed, with costs of this appeal.

Bischoff and Pryor, JJ., concur.


text:
    Charles G. F. Wahle, Ex'r, Resp't, v. Samuel McMillan, App'lt.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    1. Depositions—Examination befobe teial.
    An order for the examination of a party before trial, under §§ 870-878 of the Code, rests in the discretion of the judge granting it.
    2. Same—Affidavit.
    It is not necessary that the affidavit should state a complete cause of action; it is sufficient if it states the nature of the action and substance of the judgment demanded.
    Appeal from an order of the city court, affirming an order for the examination of the defendant before trial.

      John G. Shaw (Gratz Nathan, of counsel), for app’lt;

      Edward C. Stone, for resp’t.

       See 48 St. Rep., 32.

   Bookstaver, J.

— Appeals from the general term of the city court to the general term of this court are, in general, governed by the same rules as apply to appeals from the general term of this court to the court of appeals, and that court uniformly refuses to review appeals from orders resting in the discretion of the court below; and, in fact, such appeals are prohibited by § 190 ■of the Code. An order for the examination of a party under §§ 870-873, has been repeatedly held to rest in the discretion of the judge granting it. In the leading case of Glenney v. Stedwell, 64 N. Y., 120, it was held that, “ if the affidavit discloses such a case as gives the judge power to act, what action he will take is discretionary with him and may not be reviewed here.” In Jenkins v. Putnam, 106 N. Y., 276; 8 St. Rep., 710, the court said: While it is said in § 873 that the judge must grant the order when an affidavit conforming to the requirements of the previous section is presented to him, yet we do not think that the language is absolutely mandatory, and that it was intended to deprive the judge of all discretion. * * * If, from the.nature of the action and the other facts disclosed, he can see that the examination is not necessary for the party seeking it, then it cannot be supposed it was the legislative intent that he should be obliged to make the order.”

And the court arrived at this conclusion, “ It is one of those matters of practice and procedure which should always be left to the discretion of the court of original jurisdiction and its decision should not be reviewed here, unless it appears from its order that the decision was placed upon some ground of law not involving discretion.” See also Woerishoffer v. N. R. Construction Co., 99 N. Y., 403; Herbage v. City of Utica, 109 id., 81 14 St. Rep., 845. It follows that this order cannot be reviewed by us unless there was a total failure of the plaintiff to present to the court below facts on which it could exercise its discretion. The affidavit presented to the court on which the examination was ordered sets forth that the plaintiff had discovered in the books of account kept, owned and left by his testator, a running account with defendant which showed items of charges against and credits to defendant, and a balance of $268.42, as due the testator from defendant, with interest from November 16, 1891; and that the action was brought on this book account. It then goes on to state that .some of the words and figures contained in the book account are unintelligible to him, inasmuch as the testator simply entered as a part of the book account the amount due from him to defendant, or the amount due from defendant to him. This, we think, was sufficient to give the justice granting the order jurisdiction to grant it, especially as the plaintiff was an executor and the facts must of necessity have been more within the defendant’s knowledge than the plaintiff’s. It is not necessary that the affidavit should state a complete cause of' action; it is sufficient if it states the nature of the action and the substance of the judgment demanded, both of which are clearly set forth in the affidavit. Frothingham v. Broadway R. R. Co., 9 Civ. Pro., 305; Heishon v. Knickerbocker Life Ins. Co..45 Super., 54. In Raymond v. Brooks, 59 How., 383, which was cited with approval in Fatman v. Fatman, 45 St. Rep., 859, it was held that “ the plaintiff suing in a representative capacity, and not having personally participated in the matters concerning which inquiry is sought, properly enough asks that he may be allowed to examine one of the defendants, who is reasonably supposed to have the knowledge, to ascertain the facts covered by the questions.” And in Carter v. Good, 57 Hun, 116; 32 St. Rep., 501, it was even admitted by the presiding justice, in his opinion, that the affidavit did not contain the essential- requisites in ordinary cases, but continues, “ the rule with regard to the examination of a party before trial is one of discretion. Herbage v. City of Utica, 109 N. Y., 81; 14 St. Rep., 845.

“ It is, therefore, flexible and must be adapted to and controlled by the facts and circumstances of each case, considered with reference to the relations existing between the parties.” See also Goldberg v. Roberts, 12 Daly, 339.

We are of the opinion that, in this case, under the peculiar circumstances of it, the justice granting the order had jurisdiction to do so, and it rested in his discretion to grant the order, or to refuse it. The appeal should, therefore, be dismissed, with ten dollars costs and disbursements to respondent.

Bischoff and Pryor, JJ., concur.


author: Bischoff, J.

text:
    Allen R. Pharo et al., Resp'ts, v. Beadleston & Woerz, App'lt.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    Contract—Breach—Eviden ce.
    In an action to recover damages for defendant’s breach of contract to accept and pay for a quantity of thermometers manufactured by plaintiffs at defendant’s instance for use as an advertising medium in the latter’s brewing business, the defense was that the contract was induced by material misrepresentations by plaintiffs’ agent; defendant’s agent testified he stated to plaintiffs’ agent that they desired a novel and original design for an advertising medium in their business, and that he represented that plaintiff’s had not,theretofore, supplied any brewer with thermometers; that relying on the truth of this he made the contract, and that it subsequently transpired that the representation was false. To disprove such testimony plaintiffs were allowed to show, under objection, that thermometers had been extensively used for advertising purposes in in other lines of business than that of a brewer. Held, that the evidence was properly admitted to affect the credibility of the defendant’s agent, who concluded the contract, and, therefore, was directly interested in its avoidance.
    Appeal from a judgment of the general term of the city court of New York, which affirmed a judgment for plaintiffs entered upon a verdict in their favor, and which also affirmed an order-denying defendant’s motion for a new trial upon the minutes.
    Action to recover damages for defendant’s breach of contract to accept and pay for a quantity of thermometers manufactured by plaintiffs, at defendant’s instance, for use as an advertising medium in the latter’s brewing business. Defendant claimed, by way of defense, that it was induced to make the contract by alleged material misrepresentations of plaintiffs’ agent.

      Edward S. Clinch, for resp’ts;

      Guggenheimer & Untermyer (ifoses Weiman, of counsel), for app’lt.
   Bischoff, J.

Ho appeal lies to this court from an order of the city court of Hew York which refuses a new trial, Code Civ. Pro., § 3191; Wilmore v. Flack, 96 N. Y., 512; Smith v. Pryor, 16 Daly, 169; 30 St. Rep., 553, and without proper exception founded upon a motion for dismissal of the complaint, or that a verdict be directed for defendant, we are not permitted to search the evidence for its sufficiency in support of the verdict. Barrett v. Third Ave. R. R. Co., 45 N. Y., 628; Schwinger v. Raymond, 105 id., 648; 7 St. Rep., 544.

On plaintiff’s direct examination he was asked, “ Por what purpose did you call upon defendants after they had refused the thermometers ? ” This question was allowed against objection by defendant’s counsel, but in view of the fact that the witness had theretofore testified to the purport of his visit without objection, the answer was mere reiteration. Ho ground of defendant’s objection was given, and so the exception is ineffectual. Cruikshank v. Gordon, 118 N. Y., 178; 28 St. Rep., 784.

Alfred M. Beadleston, a witness for defendant, was asked, on his direct examination, “ Did he (meaning plaintiffs’ agent) say anything as to whether any other brewer had such thermometers?” This was clearly leading and so properly excludedbut, assuming the exclusion of the question to have been error, it was waived, and the exception thereto rendered ineffectual by the witness’ testifying, without objection, to the next two following questions of defendant’s counsel: “ Go on and state anything else he said.” and “ Was anything said as to other breweries having these thermometers, and if so, what ? ” Neil v. Thorn, 88 N. Y., 270, 277; Crosby v. Day, 81 id., 242.

The remaining exceptions present but one question, and may, therefore, be considered collectively. The defense was that at the time of entering into the contract for supply of the thermometers, Beadleston, representing the defendant corporation, stated to Bonnell, plaintiffs’ agent, that defendant desired an advertising medium for the brewing business of novel and original design in that line of business; that Bonnell represented that plaintiffs had not theretofore supplied any brewer with the thermometers; that relying upon the truth of this representation he (Beadleston) was induced to make the contract on defendant’s behalf; and that it subsequently transpired that the representation was false and untrue. Beadleston’s testimony tended to establish this defense, and to disprove it plaintiffs were permitted to introduce evidence from which it appeared that thermometers had for a considerable time before the making of the contract been extensively and notoriously used, in the city of Hew Yorlc'and elsewhere, as an advertising medium in a variety of businesses other than that of a brewer. To the introduction of this evidence defendant objected on the ground that the fact in issue was whether, or not, thermometers had been previously used as an advertising medium in the brewing business, not whether or not they had theretofore been used for such purpose in any business. The objection was overruled, and due exception taken.

We are of the opinion that the evidence was properly admitted. The credibility of a witness is always in issue, and evidence of any fact which tends to impeach it or to demonstrate the improbability of the truth of his assertions is relevant to the issue and admissible. Beadleston having concluded the contract for defendant, was chargeable with its improvidence and directly interested in its avoidance. His credibility was for that reason a main element for the consideration of the jury in reaching a conclusion concerning his alleged motive in making the contract and his communication of that motive to plaintiff’s agent. Canajoharie Natl. Bank v. Diefendorf 123 N. Y., 191; 33 St. Rep., 389. Evidence tending to show that thermometers had for a long time before the contract with defendant been in general use as a medium of advertisement unquestionably affected the probability of the truth of Beadleston’s assertion that he was induced to make the contract because he wanted a medium “ of novel and original design ” in the brewing business, and the jury were at liberty to infer therefrom that the claimed importance of the exclusion of thermometers, as a means of advertising, from other breweries, was a mere subterfuge resorted to by defendant to rid itself of a contract improvidently made by its agent.

The judgment appealed from should be affirmed, with costs.

Daly, Ch. J., and Pryor, J., concur.

       Affirming 47 St. Rep., 129.


author: Pryor, J.

text:
    David H. Carroll, Resp't, v. Charles Tucker et al., App'lts.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    1. Principal and agent—Sub-agent—Compensation.
    Where a sub-agent has been employed without authority, and his acts are afterwards ratified, he can recover no compensation from the principal, but must look to the agent.
    2. Same—Brokers—Commissions.
    In an action by a real estate broker to recover commissions on a sale effected through his instrumentality, it was conceded that plaintiff was not retained directly by defendants, but commissioned by their agent, T., a broker retained to sell the property. Plaintiff’s attorney called on one of the defendants before bringing the suit, and asked whether T. had “ authority to bind the defendants, or to sell and employ a broker,” defendant answered, as plaintiff testified, that “ T. was authorized to take any steps necessary to sell.” Held, that authority to take steps necessary to sell does not involve authority to employ another broker.
    Appeal from judgment of the general term of the city court, affirming judgment on a verdict.
    Action for broker’s commission on a sale of realty.

      Chas. P. & Wm. W. Buckley (John Broolcs Leavitt, of counsel), for app’lts;

      Lyman L. Settel (John F. McIntyre, of counsel), for resp’t.
   Pryor, J.

At the close of plaintiff’s case the defendants moved a dismissal of the complaint on the grounds that the plaintiff had no' authority as broker of the defendants, and was not the procuring cause of the sale; and the motion was renewed upon all the evidence.

We are of the opinion that enough, was shown to authorize the inference that the sale was effected through the instrumentality of the plaintiff; but whether he acted upon the employment of the defendants is a more difficult question.

It is a ^conceded fact that the plaintiff was not retained directly by the defendants; but the contention is that he was commissioned by their agent, Thompson. And so he was without doubt; but whether as sub-agent of Thompson, or as independent broker for the defendants, is a point upon which in a measure the appeal depends. Thompson was the broker whom the defendants employed ; and if, to promote the sale, he engaged the plaintiff as his auxiliary on an agreement to divide commissions, then, as sub-agent, plaintiff must look only to Thompson for compensation. Thompson testifies: “ We were both brokers in the matter; there was a sort of implied understanding between brokers that I would divide commissions with him.” Plaintiff says Thompson “told me he would pay me a commission; ” a commission, not the commission, and he, not the defendants, would pay it. Obviously the plaintiff’s own version of the transaction is in harmony with Thompson’s statement that he was to divide his commission with the plaintiff. But that the plaintiff understood he was only to share Thompson’s compensation is cleared of all doubt by the fact that he presented a bill, and threatened suit for only half the commission. True, the claim for half commission was asserted against the defendants; but that only shows plaintiff’s mistake as to the party legally liable to him. True also, that the next day plaintiff’s attorney made demand of the full commission; but that only shows the attorney’s skill-in trying to nullify the effect of the client’s admission.

Our conclusion is that, upon the uncontradicted evidence, plaintiff was employed by Thompson to assist him in the negotiation on an agreement to divide his commission; auod that so, as sub-agent, plaintiff sustained no such relation to the defendants as made them liable for his compensation. 1 Am. & Eng. Ency. of Law, 395.

Assuming, however, that Thompson employed plaintiff as broker for the defendants; it was incumbent upon plaintiff to prove that Thompson had authority so to employ him. Without specific authority from his principal an agent has no power to delegate his trust. Lewis v. Ingersoll, 3 Abb. Ct. App. Dec., 55; Newton v. Bronson, 13 N. Y., 587; Hicks v. Dorn, 9 Abb., N. S., 53; Merrill v. Co., 24 Hun, 300; Lyon v. Jerome, 26 Wend., 485. Indisputably the office of broker involves personal confidence and discretion. Bonwell v. Howes, 15 Daly, 43; 19 St. Rep., 809.

Did the defendants empower their broker, Thompson, to substitute another in his stead? Both Thompson and defendant, Arthur 0. Tucker, deny the communication of any such power. But, plaintiff relies on an alleged admission of Tucker to the contrary. A day or two before commencing this action plaintiff’s attorney called on Mr. Tucker, for the purpose of ascertaining “ whether Mr. Thompson had authority to bind the Tuckers,, to sell and employ a broker.” Mr. Arthur C. Tucker said, “ that Mr. Thompson was authorized to take any steps necessary to sell.” As broker employed to sell, Thompson, of course, had authority to take the steps necessary to that end. To have denied him such power would have been to render his agency frustrate. But, surely, authority to take the steps necessary to a sale does not involve authority to employ another broker; for, if one broker, then why not a second and a third, and so on indefinitely, until the principal be crushed under the accumulated weight of countless commissions?

But, the person whom the attorney had the precaution to take with him as a corroborative witness fails to sustain him, saying, that Tucker’s words were that Thompson “ had full authority to sell.” This is no more than a declaration that Thompson was a broker to sell. The learned trial judge, in his charge, misapprehended the effect of the testimony, when he told the jury that Tucker stated to the attorney “ that Thompson had full authority to employ brokers for the sale of the property.”

On a critical review of the case we see that, at most, the finding that the defendants authorized Thompson to retain the plaintiff is sustained only by a scintilla of evidence ; and this is ineffectual against a motion to nonsuit. Dwight v. Ins. Co., 103 N. Y., 341; 3 St. Rep., 115.

The respondent argues, however, that by consummating the sale winch he negotiated, the appellants are estopped to question his authority, upon the ground that the enjoyment of the fruits of an agent’s act charges the principal with responsibility. The principle upon which the respondent relies is of recognized and salutary operation; but he misapprehends its import and application. The rule, as propounded in a leading case of this state, is, that <l when an agent, acting within the scope of his actual authority, perpetrates a fraud for the benefit of his principal, and the latter receives the fruits of it, he thereby adopts the fraudulent acts of his agent.” Smith v. Tracy, 36 N. Y., 79; Mayer v. Dean, 115 id., 556; 26 St. Rep., 375. Here the act of Thompson in substituting plaintiff as broker, if there were such substitution, was beyond the scope of Thompson’s authority; and the transaction, the enjoyment of the fruits of which is supposed to estop the appellants, was not the transaction of their agent, but of a stranger. The rule was never applied, and in reason can never be applied, so as to validate a delegation of his agency by a broker, else the principal would be at the mercy of his broker, and might be burdened with liability to as many deputies as the broker should choose to appoint. The law is settled otherwise. “Where the sub-agent has been employed without authority, and his acts are afterward ratified, he can recover no compensation from the principal, but must look to the agent.” 1 Am. & Eng. Ency. of Law, 395.

We conclude, therefore, that upon the uncontroverted evidence the appellants are not responsible for the employment of the plaintiff, and are under no obligation to compensate him.

Our conviction that the respondent’s claim is without equity reconciles us the more readily to the defeat of his j udgment on legal grounds.

Judgment reversed and new trial ordered, costs to abide the event.

Bookstaver and Bischoff, JJ., concur.


text:
    Maicho Fortunato, Pl'ff, v. The Mayor, etc., of the City of New York, Resp't, and The Twelfth Ward Bank of the City of New York et al., Impl'd, App'lts.

      (New York Common Pleas,

      General Term,

      Filed Febuary 6, 1893.)

    Mechanics’ lien—Opening judgment—Reference.
    In an action to foreclose a municipal mechanics’ lien, and to determine the precedence of several claims against the city under a certain contract with one D., the only question was to whom, in what order and in what amounts the money due D. was to be paid; no claim was made against the city for extra work. The case was tried, but on its conclusion the referee allowed an amendment of D.’s answer, which authorized a recovery by him against the city for extra work, at a meeting which the city’s representative did not attend, erroneously supposing it held only for the purpose of summing up; judgment was entered in favor of D. against the city for the extra work. Upon motion of the city an order was granted opening the judgment, referring it back to the referee and pi rmitting the city to oppose D.’s motion to amend and, if need be, to contest his claim for extra work. Held, that the order was properly granted.
    Appeal from order at special term.

      Charles W. Dayton and C. J. Q. Hall, for app’lts;

      William H. Clark (Theodore Connoly and John D. O'Brien, of counsel), for resp’t.
   Pryor, J.

The action is to foreclose a municipal mechanic’s lien, and to determine the amount and precedence of several claims against the city under a contract with one Dawson. As the case stood upon the pleadings before the amendment complained of, the city was a merestalce holder; and the only question in litigation was to whom, in what order and in what amounts the money due to Dawson from the city was to be paid. No claim whatever was made against the city for extra work. So the case was tried; but on its conclusion the referee allowed • an amendment of Dawson’s answer which authorized a recovery by him against the city for extra work in the sum of $5,840. The evidence touching the extra work was not irrelevant to the issues as they then stood ; and its admission did not necessarily admonish counsel for the city that a recovery for it was contemplated in the action. Indeed, it appears that the claim for the extra 'work did not accrue till after the commencement of the action. The amendment of Dawson’s answer authorizing the recovery of the $5,840 was made at a meeting which the legal representative of the city did not attend, and which he and others supposed, though erroneously, to be held only for the purpose of summing up, a matter which, on the then state of the pleadings, was of no concern to his client. On June 9,1892, judgment in favor of Dawson against the city, on account of the extra work, was entered for the above stated amount. From the judgment the city appealed, 16th September, 1892, and. on October 1, 1892, made a motion for the order under review. The order, in effect, opens the judgment, permits the city to oppose the motion to amend, and, if need be, to resist Dawson’s claim for the extra work.

The order is not for a re-trial of the ease or review by the referee of his own determination; but only opens a default for the litigation of an issue that had gone without contestation. Neither was the effect of the order merely to allow an exception to the ruling permitting the amendment. Nor yet was the referee functus officio in the sense that the case might not be sent back to him for the purpose of opposing a motion that had prevailed by default, and, if necessary, to defend a claim not within the issues upon which the trial proceeded. Had the referee held this claim to be in issue on the original pleadings, and so have determined it, then, indeed, would he have been functus officio, and the order a direction to revise his decision and re-try the case.

Such being the nature of the order under review, the authorities so industriously collected by the learned counsel for the appellants are inapplicable to the point in judgment. The order being, in effect, the vacatur of a default, taken against the respondent through its “ mistake, inadvertence, surprise or excusable neglect,” was, by the express terms of the Code, within the competence of the court and dependent on its discretion. § 724. Nay, for that matter, independently of the statute and irrespective of its restrictions, the court had inherent power to grant the relief afforded by the order. Vanderbilt v. Schreyer, 81 N. Y., 646; Dinsmore v. Adams, 48 How., 274; 66 N. Y., 618; Ladd v. Stevenson, 112 id., 332; 20 St. Rep., 746; Hatch v. Central Nat. Bank, 78 N. Y., 487; Matter of Buffalo, 78 id., 362; Trustees, etc., v. Merriam, 59 How., 226.

The order, then, being within the jurisdiction of the court, was discretionary; and we are to say whether the discretion of the court in passing the order was abused or improvidently exercised. We think not.

It is extremely doubtful whether, in any aspect, the claim for extra work can be made a ground of recovery against the city. Consolidation Act, §§ 1824 d seq.

The order of the referee allowed an amendment to conform the pleading to the proof; but this can never be done on the trial when, as here, the amendment changes, substantially, the claim or defense. Code, § 723; Dougherty v. Valloton, 6 Jones & S., 455, 457; Quimby v. Claflin, 13 W. Dig., 203; Trustees v. Merriam, supra; Woolsey v. Trustees, 2 Keyes, 605; Price v. Brown, 98 N. Y., 388; Bockes v. Lansing, 74 id., 437.

_ Since it appears that all the money, except the $5,840, has been distributed among the several claimants, and the only question to be litigated under the order on appeal is the validity of this claim for extra work, which concerns only Dawson and his assignees, we do not perceive any embarrassment or prejudice to other parties which should have prevented an exercise of judicial discretion in favor of the respondent.

For certainly a municipal corporation is no less entitled than a natural person to relief from the consequences of the improvidence of its counsel, if indeed regard for the public interests do not give it a claim to even greater indulgence. Greer v. The Mayor, 1 Abb., N. S., 210, 211; Seaver v. The Mayor, 7 Hun, 331; Brooks v. Mayor, 12 Abb. N. C., 350; Lunney v. Mayor, 14 W. Dig., 140.

Observing, therefore, no abuse of discretion in the allowance of the order by the learned judge at special term, we decline to reverse it Schreyer v. Vanderbilt, supra; Bryon v. Durrie, 6 Abb. N. C., 139; Jones v. Hoyt, 10 id., 324; Morss v. Hasbrouck, 13 W. Dig., 393; Morrison v. Agate, 20 Hun, 23; Barton v. Barton, 24 W. Dig., 219; Avery v. R. R. Co., 9 N. Y. Supp., 404; 30 St. Rep., 239.

Order affirmed, with costs.

Bookstaver and Bischoff, JJ., concur.


text:
    Oscar Compton, Resp't, v. John D. Heissenbuttel et al., App'lts.

      (New York Common Pleas,

      General Term,

      Filed February 6, 1893.)

    1. Contract—Breach—Limitation.
    In an action for damages from breach of an agreement by the defendants to pay for wharfage of plaintiff’s boat, chartered by them, it appeared that the contract of defendants was “to pay the wharfage at the place of destination to the owner or lessee of the wharf.” Such wharfage became due in March, 1882, and on defendants’ default was paid by plaintiff to release the boat. The action was commenced in August, 1888. Held, that the statute of limitations constituted a valid defense to the action.
    2. Same.
    In such case, a demand was not necessary to start the statute.
    Appeal from judgment of a general term of the city court, affirming judgment on a verdict.
    Action for damages from breach of an agreement by the defendants to pay for wharfage of plaintiff’s boat chartered by defendants.
    The facts sufficiently appear in the opinion.

      James L. Bishop, for app’lts;

      Hyland & Zabriskie, for resp’t.

       Reversing 48 St. Rep., 506.

   Pryor, J.

When the case was' before us on a former appeal, we held that the undertaking of the defendants was to pay the plaintiff the amount of the wharfage. It appears by the record that the proof varied on the second trial, and that the contract of the defendants was “ to pay the wharfage at the place of destination to the owner or lessee of the wharf.” In either event, however, the period of limitation is identical, namely, six years “ after the cause of action has accued.” Code, §§ 380, 382. The defendants plead the statute in bar; and the precise point for adjudication is: When did the cause of action accrue?

The rule is that in the case of torts quasi ex contractu, and in actions for breach of contract, the statute begins to run at the date of the tort or the breach, and not when the damage ensues. 13 Am. and Eng. Ency. of Law, 722; Northrop v. Hill, 57 N. Y., 351; McKerras v. Gardner, 3 Johns., 137; Bogardus v. Young, 64 Hun, 398; 46 St. Rep., 780; Hogan v. Wolf, 26 Abb., N. C., 1.

The cause of action alleged in the complaint is the breach by the defendants of an agreement “ to pay the owner or lessee of the-wharf at the place of consignment,” other averments being merely a statement of the damage consequent upon the imputed wrong.

The respondent argues, that either the engagement of the de.fendants was a contract of indemnity, in which case the right of action would emerge only on the occurrence of the loss indemnified against; or else that their liability was upon an implied agreement to reimburse plaintiff for money paid to their use, in which case the cause of action would arise only on the payment of the money by the plaintiff.

But, neither proposition is tenable.

In undertaking to pay the wharfage the defendants agreed thus to liquidate a part of their indebtedness for the hire of the boat; and in paying it, as between themselves and the plaintiff, they would have merely discharged their own proper obligation. The essential property of a contract of indemnity is an engagement to protect another against loss or liability to a third person ; and this quality is not predicable of an undertaking for one’s own act or debt, although the accomplishment of the act or payment of the debt would relieve the contractee from his liability to another. Hence, in the present case, as appears by the nature of the contract, as well as from the pleadings and proofs, the cause of action is the breach of the defendants’ obligation to pay their debt, and not a failure to pay a debt of the plaintiff.

Unquestionably, between plaintiff and defendants the relation of surety and principal subsists; so that upon payment of the wharfage by the former he might have maintained against the latter an action on an implied assumpsit for money paid to their use. But, the complaint proceeds neither upon a contract of indemnity nor an implied contract to reimburse plaintiff, but upon the breach of an express agreement to pay the wharfage; and upon this theory only was the case conducted to judgment. The defendants undertook to pay the wharfage ; ten dollars in amount, upon their default the plaintiff paid it; and in an action on an implied assumpsit he could recover only the ten dollar's with interest. In fact, however, he has recovered two hundred and five dollars and seventy-two cents, which sum embraces not only the ten dollars and interest, but consequential and collateral damages from the breach of defendants’ agreement.

The cause of action sued on, to wit: failure to pay the wharf-age, accrued upon the default of the defendants to pay when due, namely, March, 1882. The action was commenced 8th August, 1888. The case is not one in which a demand was requisite to start the statute. Code, § 410; Bogardus v. Young, 64 Hun, 398; 46 St. Rep. 780.

Our conclusion is that the statute of limitations constituted a valid defense to the action.

Judgment reversed and new trial ordered, costs to abide event. Bookstaver and Bischoff, JJ., concur.


author: Dwight, P. J.

text:
    William Halter, App'lt, v. John Shaffer, Resp't.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Sale—Evidence.
    In an action for goods sold, the plaintiff testified to the sale of goods to defendant at different times during four years; that he charged them when not paid for at the time; that he kept the books himself, and that the amount due was a certain sum which he got from the books. Held, that the admission of evidence as to the amount was error, as plaintiff did not pretend to have any knowledge of the items or amount except as he obtained them from his books, and testimony as to their contents without producing them was incompetent.
    Appeal by the plaintiff from a judgment of the county court of Cattaraugus count}'", reversing a judgment of a justice of the peace of the town of Clean.

      H. Donnelly, for app’lt;

      M. B. Jewell, for resp’t.
   Dwight, P. J.

In this action, for a butcher’s bill, the plaintiff testified to the sale and delivery of meat to the defendant and his wife, at different times in the last four years; that he charged it when it was not paid for at the time; that he kept the books himself; that the amount due him was $13.37, and that he got the amount from his books. This evidence was objected to as incompetent and immaterial and that the books should be produced. The justice overruled the objection, and, without any further evidence in support of the claim, rendered judgment for the plaintiff for the amount so testified to by him. The defendant gave evidence disputing the entire claim.

The county court very properly reversed the judgment of the justice, mainly on the ground that there was no competent evidence to sustain it. It might well, we think, have been reversed for the error of the admission of the testimony of the plaintiff as to the amount of the debt That testimony was plainly inadmissible. The plaintiff did not pretend to any recollection either of the items or of the total of his account except as he obtained the latter from his books. He was permitted to testify to what appeared on his books without producing them.

This was in violation of a fundamental rule of evidence which cannot be disregarded without danger of a perversion of the truth. The ruling cannot be justified even under the liberal rule which governs the investigation of facts in justice’s courts. Technical errors and defects in such investigations must be disregarded on appeal, when they do not affect the merits. Code of Civ. Pro., § 3063. But when the plaintiff’s case depends wholly for support upon testimony which was plainly inadmissible, the defect cannot be regarded as technical, nor can the appellate court be satisfied that the judgment is right when based upon such testimony alone.

The case of Griffin v. Jackson, in the fourth department of this court, 36 St. Rep., 110, to which attention is called by the plaintiff, is not authority for the ruling in this case. In that case the plaintiff, proving his claim for work and labor, in the absence of any defense, testified, as of his independent recollection of the facts, that he had performed labor for the defendants during a ■continuous period named, for a portion of which, only, he had been paid, and that there remained unpaid to him therefor the .sum claimed. That evidence was competent, and the only question was of its sufficiency. The plaintiff there must be presumed, •in the absence of further inquiry which might have been made on •cross-examination, if the defendants had appeared, to have spoken from his present recollection of the amount and value of the work done, and of the payments made; here the plaintiff spoke only of what appeared on certain books which were not produced.

The judgment of reversal should be affirmed.

Judgment of the county court of Cattaraugus county appealed irom affirmed, with costs.

Macomber and Lewis, JJ., concur.


text:
    Jacob Koehler, Resp't, v. The Rochester & Lake Ontario Railway Co., App'lt.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Negligence—Contributory—Charge.
    Plaintiff with a number of others were in a carryall which attempted to cross defendant’s track, when it was struck by an engine and plaintiff was injured. The view of the track, at this point, was obstructed, and the party was engaged in hilarious singing and shouting so that an approaching train could not be heard. Plaintiff was acquainted with the locality and knew that a train was due at about that time. Held, that the court improperly refused to charge that if plaintiff and his companions approached the crossing with such noise as to prevent them from hearing the bell of the train he was guilty of contributory negligence, and in charging that he was only liable so far -as he concurred in making the noise.
    Appeal from a judgment in favor of the plaintiff, entered on "the verdict of a jury at the Monroe circuit January, 1892, and from an order denying the defendant’s motion for a new trial, made on the minutes of the court.

      G. G. Davy, for app’lt;

      Thomas Raines, for resp’t
   Dwight, P. J.

The plaintiff was hired as a musician to accompany a pleasure party from Rochester to Irondequoit Bay on a Sunday morning in August, 1892. There were twenty-eight of the party, and they went and returned in a hired carryall, driven by the owner. On their return, in the evening, they came into the city by Jennings street, and it was just about nine o’clock when they reached the intersection of Jennings street with North Avenue, on the east side of which was the track of the defendant’s road. At this crossing the carryall was struck by a locomotive engine of the defendant, drawing a train from the north, and. the plaintiff was badly injured.

There was evidence strongly tending to show that as the carriage approached the crossing, and up to the moment of the collision, the company was engaged in hilarious singing and shouting, which must probably have prevented any effective listening for an approaching train. This evidence was given by some eight or ten persons who were near the corners of the two streets,, either on the sidewalks, or on the piazzas or in open windows of neighboring houses. Several of them testify that the loud noise of singing and shouting continued up to the moment when the crash of the collision and the screams of terror were heard. This evidence was to some extent contradicted by some members of the party in the carriage, but if the fact wras a material one, the evidence was clearly such as to require the submission of the question to the jury.

The plaintiff’s own testimony showed that he was familiar with the crossing and its surroundings and with the running of trains at that point. He knew that an orchard, with thick foliage, and a building in the angle between Jennings street and North avenue, completely obstructed the vision of the driver in the direction from which the train approached, until his horses’ heads were actually upon the track of the railroad. He knew that a train was due at that crossing only a very few minutes, if at all, before the arrival of his party there. He had looked at his watch under an electric light about 500 feet from the crossing, and found the time to be “ nine o’clock, or a little before,” and he knew that the train was due at the North street station at five minutes before nine.

Such being the case, counsel for the defendant at the proper time requested the court to charge “ that if the plaintiff and his companions in the carryall approached this railroad with music and singing, and that thereby they were prevented, or he was prevented, from hearing the bell of the train, if it was rung, he was guilty of contributory negligence, and cannot recover.”

The court declined to vary the charge already given in this respect, and counsel for defendant excepted. But the court thereupon proceeded to instruct the jury further in this particular, and to the effect that only so far as the plaintiff concurred in making the noise, and was a party to it, and helped it along, could he be charged with carelessness in going upon the crossing with such a noise about him. This was not what the court was requested to charge, but, rather, was calculated, we think, to convey an impression contrary to the purpose of the request. The proposition which, we think, was fairly presented by the request, was that it was negligence in the plaintiff to go upon the track with the din of noise in his ears which prevented him from hearing the sound of the approaching train ; and this without regard to -whether he was making or helping to make the noise.

We think the proposition was a correct one; that it was the duty of the plaintiff, familiar as he was with the situation and its dangers, knowing that the train', if approaching, could not be seen, and that the only safeguard was the sense of hearing, to refuse to go upon the crossing in a noise which prevented the exercise of that faculty. If his warnings and expostulations had no effect upon the driver or the company, it was his duty to look out for his personal safety and escape, if he reasonably might, from an environment so fraught with danger to himself. And this, it would seem, he could easily have done, because, as he testifies, the horses were going at a walk, and he was seated immediately at the door in the rear end of the vehicle; in the last seat on the south side, next the top of the steps by which passengers alighted.

We think the defendant is entitled to an instruction to the jury, substantially to the effect that if the plaintiff permitted himself, under the circumstances of this case, to be carried upon that crossing in a noise of singing and” shouting which prevented him from exercising his sense of hearing to discover the approach of the train, he was guilty of negligence which contributed to produce the casualty of which he complains, whether he was engaged in making a noise or not.

The judgment and order denying the motion for a new trial should be reversed.

Judgment and order appealed from reversed and a new trial granted, with costs to abide the event.

Macomber and Lewis, JJ., concur.


text:
    James Talcott, Resp't, v. Peter Thomas et al., App'lts.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    1. Assignment for creditors—Husband and wife.
    The mere fact that a wife is carrying on a separate business does not change her relation to her husband nor deprive him of his right to her services in a domestic capacity. Where she keeps a restaurant, the husband cannot incur an indebtedness to her for board furnished him at such place which can be enforced against him or preferred to the claims of his creditors.
    3. Same—Bar.
    An accounting by and discharge of the assignee after the commencement of an action to set aside the assignment are not a bar to a further accounting by the assignee in case the assignment is set aside.
    Appeal from an interlocutory judgment entered in Genesee <county July 6, 1888, on the findings and decision of the court at special term, and from a final judgment entered January 23,1892, -on the report of a referee appointed by the interlocutory judgment, to take an accounting.
    A. A. Washburn, for app’lts;

      K A. Olarh, for resp’t.
   Dwight, P. J.

The action was in the nature of a creditor’s bill to set aside a voluntary assignment made by the defendant, Peter, to the defendant, John Thomas, as being in fraud of creditors ; and to obtain payment of the plaintiff’s judgment out of the assets of the assignor which had come into the hands of the assignee. All the facts necessary to entitle the plaintiff to maintain such an action were established by the pleadings; and the facts upon which the trial court based its conclusions adverse to the validity of the assignment were established by uncontradicted ■evidence. Those facts were, in brief, that by the assignment preference was given to an alleged indebtedness of the assignor to his wife, “ for his board in the house where he and his said wife and family resided together, including the services of his wife therein.” The subject of this preference yms characterized, in the findings of fact as a pretended indebtedness, and by the conclusions of law it was declared to constitute no obligation on the part of the assignor as against his creditors, and as to them the assignment was declared fraudulent and void by reason of such preference.

The circumstances of the alleged indebtedness as testified to by the wife were as follows : The wife of the assignor was possessed, at the time of her marriage in 1865, of a small sum of money, $400 or $500. What be'came of the money in the meantime does not at all appear, but in 1881 she went into the business of keeping “a restaurant” in the same house in which she lived with her husband and five children, all under the age of twenty-one years. The restaurant business consisted of the sale of liquors at a bar, and an occasional meal served in the family dining room. The wife took the lease' of the house and the license to sell liquor in her own name. She employed no servant, but did all the work of the house herself, with the aid of the minor children of herself and the assignor. The oldest son tended the bar most of the time, and when he was away the wife, and sometimes the assignor, waited on customers.

We think there is nothing in these circumstances to take the case out of the rule so well, established in this state that, notwithstanding the married woman’s acts, the wife still owes to the husband the services rendered in a domestic capacity to him and his children, and that for such services a valid indebtedness cannot be incurred. Coleman v. Burr, 93 N. Y., 17, 25; Blaechinska v. Howard Mission, 130 id., 497; 42 St. Rep., 387; Brooks v. Schwerin, 54 N. Y., 343.

The fact that the wife was carrying on a separate business at the same time does not change the relation in which she- stood, nor the obligations which she owed to her husband. The board which he received in his house was in large part the product of the labor of his wife and his minor children, to which he was entitled without charge, and for which he could incur no indebtedness which could either be enforced against him or preferred to the just claims of his creditors.

We can have no doubt of the correctness of the findings and conclusions of the trial court in the respect mentioned, nor of the judgment based thereupon.

The remaining appeal in this case is from the final judgment entered on the report of the referee appointed by the interlocutory judgment to take an accounting of the assigned estate which had come into the hands of the assignee. The basis of this appeal is the contention on behalf of the defendants that an accounting had in a proceeding under the general assignment act instituted in the county court since the commencement of this action was a bar to any further accounting by the assignee, and that the discharge of the assignee in that proceeding was conclusive upon the plaintiff herein.

We regard this contention as wholly untenable. The action and the proceeding are wholly opposed to each other in purpose and in theory. The one is in furtherance of, the other in hostility tó, the'assignment. The one assumes its validity, the other asserts that it is void and of no effect. If the action prevails there is no assignment, and the proceeding goes for naught. By the commencement of the action the plaintiff acquired an equitable lien, to the extent of his judgment, upon the assets of the assigned estate, which, upon the recovery of judgment for the relief sought, became enforcible against such assets as of the date of the commencement of the action. Edmeston v. Lyde, 1 Paige, 637; Eager v. Price, 2 id., 333; Knower v. Central Nat. Bank, 124 N. Y., 559; 37 St. Rep., 89. Of course such a lien cannot be divested by any proceeding instituted by the assignee subsequent to the commencement of the action.

The principles thus briefly stated are fully and well elaborated in the opinion of the learned referee by whom the accounting herein was taken. We have no doubt of the correctness of his conclusion that the assignment having been adjudged void as to the plaintiff, he was entitled to an accounting of the assets of the estate as they were at the time of the commencement of his action, notwithstanding the accounting already taken under the assignment in a proceeding subsequently commenced.

We find, however, no valid objection to the result reached by the accounting so taken, but are of opinion that the assignee was properly charged with the items reported against him.

Both the interlocutory and final judgments should be affirmed.

Judgments appealed from affirmed, with costs payable out of the assigned esstate.

Macomber and Lewis, J.J., concur.