author: Maynard, J.

text:
    Taendsticksfabriks Aktiebolaget Vulcan, Resp’t, v. Elijah Myers et al., App’lts.

      (Court of Appeals,

      Filed October 3, 1893.)

    1. Trademark.
    Plaintiff was a Swedish corporation engaged in manufacturing matches, and .used since 1883 a box having “The Vulcan” stamped in red colors over a globe, and showing three medals and the words “Damp Proof,” “Trade Mark” and “ Paraffin Matches.” Defendants imported matches from Holland put up in boxes stamped in red ink “The Vulture,” and a picture of a vulture with outspread wings, and the other. words as on plai'itiff’s box. Held, that 'this use of defendants’ label was an imitation of plaintiff’s trade mark, and so closely resembled it that when used upon, boxes containing matches it had a tendency to create confusion in the market and mislead and deceive the public.

      % Same.
    It is not necessary to show that any person had actually been deceived by the imitation of the plaintiff’s trade mark; it is sufficient if injury to plaintiff's business is threatened or imminent to authorize the court to intervene to prevent its occurrence. The owner is not required to wait until the wrongful use of his trade mark has continued for such a length of time as 'to cause some substantial pecuniary loss.
    3. Same—Intent.
    The question of wrongful or fraudulent intent on the part of one who-infringes upon a trade mark does not arise where nothing but preventive; relief is granted.
    Appeal from judgment of the supreme court, general term, first department, affirming judgment in favor of plaintiff, entered after trial at special term.

      Michael H. Cardozo, for app’lts; H. Aplington, for resp’t.

       Affirming 46 St Rep., 962.

   Maynard, J.

The plaintiff is a Swedish corporation engaged in the manufacture of matches, and is entitled to the exclusive use-of -a trade mark consisting of a label affixed to a small rectangular box containing the matches, and having printed or stamped upon it in red colors the words, “The Vulcan,” over a globe, upon each side of which are the representations of three medals awarded to-the plaintiff at the Swedish exhibition at Gothenburg, in 1871, at the Russian exhibition at Moscow, in 1872, and at 'the Austrian exhibition at Vienna, in 1873, the obverse and reverse surfaces of the medals being both exhibited. There is also printed underneath the name, and over the globe, the words “ Damp Proof,” and beneath the globe the words “Trade Mark,” and at the bottom of the label the words “ Paraffin Matches.” This trade mark was adopted by the plaintiff in 1883, and has been used by it. continuously ever since, and it derives large profits from the sale-of its matches under it. The defendants are dealers in matches,, and imported from Holland, in 1889, matches put up in boxes identical in size and general appearance with those used by the plaintiff, and bearing upon them a label also printed or stamped in red ink, and with letters of the same style as those upon the plaintiff’s-; boxes, and upon which appear the words “ The Vulture,” and the picture of a vulture with outspread wings, and a fac simile of the-medals awarded to the plaintiff, and the words “Damp Proof,” “Trade Mark,” and “Paraffin Matches,” arranged in the same-way as upon plaintiff’s boxes.

The trial court has found that this use of the defendants’ label is an imitation of the plaintiff’s trade mark and so closely resembling it that when used upon boxes containing matches it has-a tendency to create confusion in the market and mislead and deceive the public.

From 'an examination of the specimens submitted to us, we think that this finding is fully supported by the proofs. The similarity between -the names employed and -the devices used ; the identity of the medals represented and the correspondence of -size, color and general appearance, when combined upon the wrapper of a. box, are so close and striking that an intending purchaser of the-plaintiff’s goods would be likely to be imposed upon if the matches-sold by defendant in these packages should be offered. While-competition is 'essential to the life of commerce, and is the consumer’s main defense against extortion, it should be fair and honost, and the manufacturer who produces an article of recognized excellence in the market, and stamps it with the insignia of his industry, integrity and skill, makes his trade mark a part of his capital in business, and thus acquires a property right in it, which a court of equity will protect against all forms of commercial piracy. It is true that the principal points of resemblance between the wrappers occur on the top of the box, and that the words and characters on the bottom and one of the sides are widely dissimilar, both in general appearance and in the details of their arrangement; but it is the top which is usually exposed to the eye of the buyer, and from which the impression would be produced as to the brand of the article offered for sale. The resemblance •of the wrappers in this respect is so marked as to leave no room for doubt what the trade effect would be.

Ho evidence was given or offered to show that any person had actually" been deceived by the imitation of the plaintiff’s trade mark, and we think that none was necessary for the maintenance of the action. It is the liability to deception which the remedy may be invoked to prevent. It is sufficient if injury to the plaintiff’s business is threatened or imminent to authorize the court to intervene to prevent its occurrence. The owner is not required to wait until the wrongful use of his trade mark has been continued for such a length of time as to cause some substantial pecuniary loss. Manufacturing Co. v. Trainer, 101 U. S., 51.

The trial court has not found, and the proof does not indicate, any intention on the part of the defendants to infringe upon the plaintiff's trade mark. They are importers of the goods, and it is not shown that they have any interest in or control over their manufacture. On the contrary, their conduct has been such since the commencement of the action as to acquit them of the charge of any wrongful or fraudulent intent. But this question •does not arise where nothing hut preventive relief is granted. It might be material if damages were sought or claimed. As was said by Judge Allen, in Colman v. Crump, 70 N. Y., 573, it is not necessary, to sustain an action of this kind, “ either to establish a guilty knowledge or fraudulent intent on the part of the wrong doer. It is sufficient that the proprietary right of the party and its actual infringement is shown.”

The cases are numerous where this principle has been asserted and applied.

We discover no error in the record, and the judgment and order must be affirmed, with costs.

All concur.


source: Caselaw Access Project

license: Public Domain

text:
    Patrick Cassidy et al., Resp’ts, v. Joseph McFarland et al., App’lts.

      (Court of Appeals,

    Filed October 3, 1893.)

    1. Reference—Long account—Compulsory reference.
    In an action to foreclose a mechanic’s lien for plumbing and gas fitting materials the complaint set forth a. claim for $4,382, of which $375 had been paid. The defendants to whom the materials had been furnished as subcontractors under Wood, the contractor, did not answer, but others did, the owner denying that there is anything due to Wood, and the latter that he owes any sum to the subcontiactors. The cause was referred by the court upon its own motion upon the ground that it appears from the pleadings that the trial of the action would involve the examination of a long account. Held, error.
    2. Same.
    The examination of a long account which the Code contemplates is something more than mere formal proof of its existence. It imports an actual contest as to the correctness of the different charges, or at least of several of them; a prolonged examination of witnesses upon the issue, conflicting proof, and a judicial inquiry and determination as to each one of numerous litigated items.
    3. Same.
    If there is conflicting evidence as to whether the examination of a long account will be involved, the decision of the court below will not be reviewed in the court of appeals; but where there is an entire failure of proof upon the point, it becomes purely a question of law for the consideration of said court.

      4. Costs—Taxation.
    Upon the appeal from the order of reference the general term made an order affirming the same, “ with costs,” and not allowing any disbursements. The respondents procured the clerk to tax $10 costs and $9.06 disbursements for affidavits and acknowledgments, certified copies of orders, sheriff’s fees on execution and printing points. Held, error; that the clerk has no authority to tax costs, except such as may be conferred upon him by the statute or by the order of the court.
    Appeal from judgment of the New York common pleas, general term, affirming order made at special term, referring issues in an action to foreclose a mechanic’s lien.

      George A. Stearns, for app’lts; Thomas C. Ennever, for resp’ts.

       Reversing 49 St. Rep., 123.

   Maynard, J.

This action was brought to foreclose a mechanic’s lien for plumbing and gas fitting materials, furnished the defendants Gorman and Sylvander, who were sub-contractors to do the plumbing in the course of the erection of three buildings in New York city for the defendant Frederick Wood, who was the contractor for the erection of the buildings for the defendant Joseph McFarland, the owner of the premises. McFarland was to pay Wood $67,158 for the erection and completion of the three buildings, and Wood was to pay Gorman and Sylvander $6,195 for the plumbing. The complaint alleges that the amount and value of the materials furnished by the plaintiffs is $4,882, no part of which has been paid except $375 ; that there is more than $4,007 due and unpaid on the contract between McFarland and Wood, and more, than that sum due and unpaid on the contract between Wood and Gorman and Sylvander. Gorman and Sylvander did not plead. Two of the other defendants, Orlofski and Cornet, filed liens and sought to foreclose them in the action, both against Wood, the contractor; one for painting work and material to the amount of $710, and the other for sand furnished to the amount of $900. All of the defendants, separately answering, deny that they have any knowledge or information sufficient to form a belief as to whether the plaintiffs furnished the materials, and they were of the amount and value alleged. McFarland denies that there is anything due Wood on his contract, and Wood denies that he owes Gorman and Sylvander any sum on their contract.

There are various other defenses, but they are not material to be considered here.

The plaintiffs did not notice the cause for trial, but it was noticed by the defendants McFarland and Wood, and placed upon the calendar, and then referred by the court, upon its own motion, against the objection of the defendants, upon the ground that it appears from the pleadings that the trial of the action would involve the examination of a long account, and that no difficult qúestions of law were involved. The general term affirmed the order of reference, and the defendant has brought this appeal-

The .order cannot be affirmed, we think, without disregarding repeated decisions of this court. In Kain v. Delano, 11 Abb., N. S., 29, it was held that a compulsory reference could not be ordered unless it affirmatively appeared that the examination of a long account was necessarily involved upon the trial. In Thayer v. McNaughton, 117 N. Y., 111; 26 St. Rep., 843, it was held that it is not enough to justify a compulsory reference that the case may, by possibility, involve the examination of a long account; that enough must be alleged or shown to justify the inference that such will be the course of the trial, and that the same rule applies to equitable as to legal actions. In Spence v. Simis, 137 N. Y., 616; 51 St. Rep., 167, it was held that a compulsory reference could not be ordered unless it appeared with' reasonable certainty that the- hearing of the case will require the examination of a long account. It is not necessary that this proof shall be made by affidavit; it is sufficient if the fact clearly appears from the verified pleadings that the examination of a long account will be involved in the trial of the issues. The referable quality of the action must also be determined from the complaint. Welsh v. Darragh, 52 N. Y., 590; Untermyer v. Beinhauer, 105 id., 521; 8 St. Rep., 1. The general term sustained the order because the plaintiff’s lien was for plumbing material furnished for the equipment of three buildings, and, as he would be required to make proof of the quantity and value, the conclusion could be drawn that a long account was necessarily involved. We do not think that such an inference is permissible. For aught that appears the materials were all furnished at one time and constituted but one bill. Gh. J. Bronson denied a reference in Swift v. Wells, 2 How., 79, on the ground that one bill of goods containing fifty different items, delivered at the same time, was but one item, and this court, in the recent case of Spence v. Simis, supra, held that a bill for coal and wood, furnished upon fifteen different occasions during a period of three years, did not necessarily make a long account within the meaning of the statute. The utmost that could properly be in-ferred is that there might be a separate bill for each building, and thus that there might be three items of plaintiff’s claim. But the-plaintiffs allege that the defendants Gorman and Sylvander agreed to pay jfor -the materials furnished a specified sum in gross, and if this allegation is sustained by the proof, as it may be, no investigation would be necessary in regard to the value of the several items, however numerous. It is also apparent from the condition of the pleadings, that it is not probable that there will be any actual controversy as to the materials furnished or their value. The defendants Gorman and Sylvander, who purchased them, make no defense, and so admit the averments of the complaint for the purposes of this action.

They are, presumably, the only parties, other than thejplaintiffs, who have any personal. knowledge upon the subject The other defendants- do not deny that the materials were furnished, and that they were of the value alleged, or that Gorman and Sylvander agreed to pay the price specified, or that they were used in the -construction of the buildings. They are content-to "allege that they have no knowledge or information sufficient to form a belief as to the truth of these allegations. It must, therefore, be presumed that there is no witness, or other source of proof known to them,' by means of which the falsity- of the plaintiffs’ demand can be established, or they could not have truthfully- made this statement on oath.

It is- true that by this form of denial the plaintiffs may be required to make proof of the details of their claim. But the examination of a long account,, which- the Code contemplates, is something more than mere formal" proof of its "existence. It imports an actual contest as to the correctness of the different charges, or, at least, of several of them; a prolonged examination of witnesses upon the issue, conflicting proof, and a judicial inquiry and determination as to each- one of numerous litigated items; Although under a denial of this kind the plaintiff may be compelled to prove the sale and delivery of each article, yet if this proof is not controverted so as to bring directly in issue each item or several items, with respect to their delivery or their-value, it is plain that "there will- not be such an investigation of a long account, within the meaning of the-statute, as to authorize a-compulsory reference.

It is insisted that under the- pleadings the plaintiffs must prove performance by Gorman- and Sylvander of their contract with Wood, and the amount due from Wood, and also performance by Wood of his contract with McFarland, and the amount due-from McFarland; but it does not follow that the examination of a long account would be necessarily in volved in such proof The amount to be paid the contractor in each case-was a lump sum, .and payments made thereon would not ordinarily be deemed" an account in the legal sense. Whether the work had been done as agreed would require a reference- to- the contract, plans and specifications, and, it may be, an examination of the-work in detail; but it cannot be presumed or-inferred-that the solution of such a-question will, of necessity, impose upon the-eou-r-t the labor of determining the correctness of a. disputed or complicated account

Trial by a refereé is an- exceptional mode of judicial procedure; and when it is-sought to- coerce a suitor into-, a- submission- to it, the burden is upon the. party applying-for- a reference to show by satisfactory proof that the case is- within - the- exeepted class. The rule is not different where the court, upon its own motion, undertakes to compel a reference. If there is conflicting evidence as to whether the examination of a long account will be involved, the decision of the court below will not be reviewed here, Welsh v. Darragh, 52 N. Y., 590; but where there is an entire failure of proof upon the point, as we think there is in this case, it becomes purely a question of law for our consideration. The claim is made that experience has fully proved that “ the proof of work done and materials furnished in mechanic’s lien cases, under allegations such as are contained in the pleadings before us, always involves the examination of a long account,” and that judicial notice might be taken of the knowledge which the court has thus acquired by experience in this class of cases.

While a court may take judicial notice of what ought to be ■generally known within the limits of its jurisdiction, the experience of judges in the trial of causes, however valuable it may be as an aid in the administration of justice, cannot be substituted for proof of an essential fact upon a judicial hearing. The results of the experience might vary with the different j udges selected as the subjects of it. If we were to decide from the records which come here, we would be compelled to say that it has not infrequently happened in this class of cases that there was no real •contest over any matter of account, but the questions actually litigated have involved the relative liabilities of owners, contractors and sub-contractors, and the conflicting rights of lienors, and other controversies not in anywise involving the examination of a long account. As it is conceded that a trial of this cause has been had before the referee, we have been reluctant to reach a conclusion which will require a reversal of the order, but it cannot be avoided, we think, without overturning well-established principles which affect the substantial rights of litigants.

There is also an appeal here from an order of the general term, affirming an order of the special term denying a motion for a re-taxation of costs. Upon the appeal from the order of reference, the general term made a order affirming the same, “ with costs,” and not allowing any disbursements. The respondents procured •the clerk to tax ten dollars costs and nine dollars and six cents disbursements for affidavits and acknowledgments, certified copies of orders, sheriff’s fees on execution and printing points. The appellants objected to the taxation, on the ground that the clerk had no authority to tax costs or disbursements; that the order of the general term did not fix the amount of costs, and that no disbursements could be allowed on the motion, except printing, and moved at special term for a re-taxation, which was denied. We think the motion should have been granted and the taxation set aside. Costs are the creature of the statute and cannot be imposed except in the cases authorized by its provisions. The clerk has no authority to tax costs, except such as may be conferred upon him by the statute or by the order of the court.

The hearing of the appeal at general term is to be regarded as a motion for the purpose of costs, and the same sums might have been allowed as on the decision of a motion, ten dollars and printing disbursements. .§ 3251. If this provision does not apply, then there is no authority for the allowance of costs upon such an appeal. Section 3256 has no application ; it refers only to costs awarded in an action. Under § 3251, the costs must be fixed by the court at a sum not exceeding ten dollars. This was admitted in the present case. As the customary allowance is the full sum of ten dollars, the decision of the court, that the respondent have costs, might properly be deemed a direction that he have the full amount, and the prevailing party might have caused that sum to beinsertedin the order of affirmance when entered, and omitting to do so, the court might have amended the order upon motion. The order did not allow any disbursements. The utmost which could have been granted, under § 3251, were those for printing. The court is not required to fix the amount of these disbursements, but might direct in the order that they be taxed by the clerk. Without such a direction the clerk would have no authority to fix their amount. When so ordered he may adjust them and note his adjustment on the foot of the order, which will then show the exact amount of costs and disbursements allowed, and for the collection of which a precept can be issued.

The order of reference must be reversed, but as it was not made upon the respondents’ motion, the reversal should be without costs in any court.

The order denying the motion for a re-taxation must be reversed and an order entered setting aside the taxation, with costs.

All concur.


text:
    James H. Lake, Resp’t, v. John B. McElfatrick et al., App’lts.

      (Court of Appeals,

      Filed October 3, 1893.)

    Contract—Architect.
    Defendants prepared plans and specifications for a theatre for plaintiff which required that stone skewhacks should be put in at each heel of the proscenium arch. When the cradle which supported the proscenium arch was removed it fell. On the trial of an action for damages through plaintiff’s having to rebuild it, etc., nine architects testified that said skew-backs were necessary to the proper construction of the arch, and there was much proof that the omission of the skewhacks was the primary cause of its falling. Held, that plaintiff’s complaint should have been dismissed upon the ground of a failure to prove that the arch was built in substantial compliance with the plans and specifications furnished by defendants, and that it was error to submit this question to the jury.
    Appeal from judgment of the supreme court, general term, fifth department, affirming judgment in favor of plaintiff, entered on verdict of jury.

      George W. Cothran, for app'lts; C. D. Murray, for resp’t.

       Reversing 46 St. Rep., 437.

   Maynard, J.

The compass of our inquiry in this case is restricted within narrow bounds by the form of the pleadings and the admissions contained in them and made upon the trial.

The plaintiff alleges that his assignor, on April 1, 1887, was about to construct an opera house at Titusville, Pa., and desired the services of a competent architect for such purpose; that the defendants were copartners doing business in New York city, and that they held themselves out to be, and represented and warranted themselves to be, competent, skilled architects, and particularly skilled in the art and science of making plans, specifications, drawings and detailed statements of all that was necessary in and about the construction of theatres and opera houses, so that if their plans, details and specifications were followed the building would be constructed in a good, accurate and substantial manner; that plaintiff’s assignor relied upon such representations and warranty, and employed the defendants to make the plans, drawings, specifications and detailed statements of all that was necessary to be done in and about the construction of a theatre or opera house for him, and agreed to pay them for their services three hundred and fifty dollars; that in consideration thereof the defendants agreed to make such plans, specifications, drawings and detailed statements, and that they should in all things be accurate, sufficient and correct, and that if they were followed in the construction of the building the plaintiff’s assignor should have a fine, well-constructed opera house or theatre, complete in all its parts, and without injury or damage to him by reason of any defect in the plans, or any failure or neglect on the part of the defendants in making the plans, drawings, specifications and detailed statements.

These averments were admitted by the defendants, and were not litigated on the trial. The complaint further alleges the furnishing of the plans by the defendants and the payment of the agreed price, and that the plaintiff’s assignor constructed the building according to the plans, specifications, drawings and detailed statements furnished and followed the directions given therein; and that they were faulty to such an extent as to cause damage to the plaintiff’s assignor to the amount of $2,261, for which plaintiff has recovered judgment. The defendants put in issue the truth of these allegations by a general denial. To succeed, the plaintiff was, therefore, required to affirmatively establish two material facts: 1st. That his assignor had followed the plans, specifications and drawings in the construction of the building in all essential matters; and, 2d. That the plans were defective; and unless there was sufficient evidence to go to the jury upon both of these issues, the judgment which he has recovered cannot stand.

The sole defect complained of was in the plan of the proscenium arch. This opening was in the form of a segmental arch, as it is called in architecture, thirty-six feet long, with a rise of eight feet. It was built of brick, and when the cradle, which supported it, was removed, it fell in, and had to be reconstructed, and the cost of rebuilding it and of repairing the injury done to other parts of the structure by its fall constituted the amount of the plaintiff’s recovery. The particular fault which the plaintiff alleged in his complaint was the omission by the defendants, in the plans and drawings of what is. known as a blind arch over the segmental arch, and that by reason of this omission no such blind arch was constructed, and in consequence thereof the wall fell. The plaintiff was permitted to give evidence upon the trial, against objection, tending to show that the fall of the arch might have been occasioned because it was too flat; that a rise of eight feet in an arch of that width was insufficient to give it the necessary spring for self-support, and that the arch was so planned and constructed that the thrust of the arch did not fall within the abutments upon which it rested, but outside of them, and that this may'have been the cause of its ruin; and also that its destruction might have been due to the use of lime mortar instead of cement; but this latter evidence was not objected to, as the defendants claim that the specifications require cement, and that, therefore,, the failure to use it would defeat the plaintiff’s cause of .action.

We need not review the exceptions to the admissibility of evidence, or those based upon a variance between the pleadings and proof, for we think the plaintiff’s complaint should have been dismissed upon the ground of a failure to prove that the arch was built in substantial compliance with the plans and specifications furnished by the defendants. The plan Of the arch was separate from the plans of the other parts of the building, and required that stone skewbacks should be put in at each heel for it to rest upon at the points where the arch meets the abutments. These were designed to be each of solid stone, the thickness of the wall, and seventeen inches in width, and twenty-six inches the other way, and weighing seven or eight hundred pounds, and their office was to furnish a firm foundation for the arch and distribute its thrust over a larger area of the abutments The senior member of -the defendants’ firm was an architect of forty-five years experience, and it was shown that he had made a specialty of the preparation of plans for theatres and opera houses ; that he had drawn such plans for many of the principal theatres in all of the large cities of the country; from seventy-five to one hundred of them; that in more than twenty of them he had put in segmental arches, having no greater rise than this one, without difficulty; that a ratio of the height to the length of an arch of one to six was regarded as safe, while in this case the ratio was one to four and three-fourths; that he always provided in every such plan for stone skewbacks; that he considered them of vital importance for the strength and stability of the structure. The utility and necessity of these supports cannot be questioned, for they sufficiently appear from the evidence of plaintiff’s witnesses. His superintendent and builder, who was responsible for the omission to put them in, testified that the whole weight of the arch rested upon the skewbacks; that the thrust of the arch in this case equalled 122,000 pounds ; that its direction was in a line right through the center of thé skewbacks,' and that this weight must be counteracted by the abutments or the arch would fall; that the burden of the mass of masonry composing the arch is distributed upon the two skewbacks substantially.

Another witness for the plaintiff, a skilled architect, says that he has always used a stone skewback where he constructed such work with quicklime ; that it gives it more of an even bearing, and throws the thrust of the arch more upon a larger space of brick around it, and that he would not build such an arch with quicklime without a stone skewback. Another architect, called by the plaintiff, stated that he preferred stone skewbaeks; that he would not feel safe in building without them; that he wouldn’t do it if he could get them; that it distributed the strength of the arch upon the abutments, and that is the purpose of putting them in, and that they produced a material effect and caused more local strength and greater stability, and that brick could not be made as effectual as stone for that purpose. Nine architects and builders were examined on the part of the defendants, who were unanimously of the opinion that skewbaeks of stone were necessary to the proper construction of the arch. One of them says that in his own practice he should regard them as having an essential function to perform in the abutment to sustain the arch; if made of stone the surface would be perfectly true, smooth and uniform and of equal tenacity; brick that has been burned and then cut has not, and never can have, these properties; if made of brick it is "only called a skewback by courtesy, and is made by cutting off, or breaking off, the brick irregularly with a trowel, or by sawing them off; it will not be as strong as though made in one piece, and a perfect surface is obtained from stone, which can never be got by cutting brick; this perfect surface is essential, because if this surface yields it results in the dropping of the arch in the center; a yielding of the skewback amounts to a yielding of the arch, and he would regard the failure to put in a stone skewback of vital importance in the building of this arch, and it would have a tendency to drop the arch by the compression of the smaller pieces of brick, which would result in weakening- or cracking the wall above; and it would be more liable to fall.

Another witness, who had drawn the plans for twenty different theatres, and at least two of which had segmental arches as flat, as this one, testified that he always put in stone skewbaeks in-order to distribute the thrust upon the abutments, and that the. ratio of strength is one to four, that is, that they will support four times as much as a brick formation for that purpose.

Another witness testified that it was a very important feature for any arch that a skewback should be of stone; that if of brick it would weaken it very materially, because every joint would be an element to induce compression at the most vital point of the arch, and a very slight compression at the skewback would be multiplied a great many times in weakening the arch at its haunches and crown. Another witness states that if the skew-backs were of brick there would be danger of their compressing or shifting, because the strain of each individual rowlock or section of the principal arch would be brought independently to bear upon an independent section of the skewback; one section might give, and that would relieve the supporting tendency of that portion of the arch, and would gradually force the piers apart, and the arch must necessarily fall.

Other testimony might he cited to the same effect; but these references to the record are sufficient to show the importance of this detail of the plan of the arch. Expert knowledge is scarcely required to establish so plain a proposition in the operation of physical laws.

There is also much proof in the record tending to show that the omission of the stone skewbacks was the primary cause of the falling of the arch. The first sign of weakness was a fracture in the brick work near the skewback on the south side. The plaintiff’s assignor in a letter to defendants August 24, 1887, informed them that the week before his attention was called by the boss carpenter to an opening horizontally of the perpendicular joints in the brick near the skewback; that the next day the opening was larger, and he put stay rods of one and a half inch steel through from outside to outside; that the breaks are all in the perpendicular joints, and no evidence of crushing or other disiurbances of the horizontal joints, and he adds, “ There has evidently been a disturbance at or' near the skewback of the arch, as the frame which supported the arch while building is crushed down at point ‘B ’ fully an in'ch.” It is apparent that he had not then concluded that there was any inherent weakness in the arch resulting from its form, or because it was too flat, for he further states that while the bricklayer insists that the arch is too flat, causing more outward pressure than the walls would support, his superintendent and builder was non-committal, but said if he were planning the building he would undoubtedly have put in just such an arch. When the arch fell one of the stay rods was broken off close to the skewback, indicating that this might be the point of greatest strain, and there was a crack in the abutment running from the skewback on each side.

One of plaintiff’s witnesses testified that the cracks, as described to him, indicated a change in the direction towards the skewback, where the weight of the brick was bearing upon the arch.

Another witness testified that the. cracks might be attributed to one of several causes, and among them the crushing of the skewback and the separating of the distances between the skew-backs.

Another witness states that a compression in the joints of the skewback which would vary its position would bring the weakest points of the arch between three to six feet from the skewback; the break would naturally take place at that point, and "a piece of the arch might still be attached to the skewback, although the fault had been originally in the movement of the skewback itself.

It appears from the plaintiff’s evidence that the point here described is the precise point where the break occurred. The defendant testified that one cause of the cracking of the arch might have been the compression of the skewback, and in such case the weakest point of the arch would be five or six feet from the skewback where it first broke, and that a stone skewback would have protected it. The trial judge held that there was sufficient evidence to support a finding that the arch fell on account of the omission of the stone skewbacks, and he submitted that question to the jury, with the instruction that if they so found the plaintiff should not recover. But we think it was error to submit this question to the decision of the jury. When it was conceded that the plaintiff’s assignor had not followed the plans in this respect, and it appeared that the failure to put in the stone skewbacks may have caused the loss which the plaintiff is seeking to impose upon the defendants, they were entitled to a ruling as a matter of law that the plaintiff could not recover, and the complaint should have been dismissed. He had failed to establish a performance of the condition precedent, which was essential to the support of his cause of action. One of the principal allegations of the complaint had been left unproven. The action is ex contractu, and the defendants cannot be made liable upon a contract which they never assented to.

There is no principle upon which a case of this kind can be excepted from the rule, so firmly established, that every stipulation which the parties have inserted in a contract by way of conditions to be performed is to be deemed material. Dauchey v. Drake, 85 N. Y., 407; Hill v. Blake, 97 id., 216 ; Tobias v. Lissberger, 105 id., 404 ; 8 St. Rep., 43 ; Bank of Montreal v. Recknagel, 109 N. Y., 482; 16 St. Rep., 398; Clark v. Fey, 121 N. Y., 470; 31 St. Rep., 424; Norrington v. Wright, 115 U. S., 188; Glaholm v. Hays, 2 M. & G., 265. The plaintiff’s assignor was contracting for the exercise of the technical knowledge and skill of the defendants, and it was upon the infallibility of their own judgment that the defendants relied when they made their guaranty that if the arch was constructed in accordance with their directions it would stand. They regarded a stone skewback of vital importance for its security and stability, and their promise to make good any loss which might occur if it fell was upon condition that this method of construction was adopted, and we are not permitted to say that they would have entered into the agreement had they known that these essential supports were to be omitted.

It is not necessary to hold that a literal performance of the condition was required. A variance, confessedly immaterial, or a departure from the plans in a separate and independent part of the building, having no structural relation to the defective member, would present a different case for our consideration. But where the variance.is not disputed, and involves the integrity of the mode of construction of the affected part, and is so far mateterial that it may have been the direct cause of the injury for which the owner seeks to hold the architect responsible, it must be held, we think, that the plaintiff has failed to establish the cause of action upon which he relies.

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

All concur.


author: O’Brien, J,

text:
    Bronson C. Rumsey et al., App’lts, v. George D. Briggs et al., Resp’ts.

      (Court of Appeals,

      Filed October 3, 1893.)

    1. Partnership—Purchase of real estate by one partner.
    When the purchase of a piece of real estate is within the scope of a partnership business, which one of the partners is permitted by the other to manage and transact in his own name, and the latter borrows money or procures indorsements from third parties in order to pay for the real estate on the credit of the firm, it will be bound by his act, though he takes the title in his own name.
    3. Same.
    A partnership agreement provided for operations on a designated tract of land and “upon any other tracts of land which shall hereafter be purchased by said copartners, as hereinafter provided.” The timber on the old tract was exhausted, and after discussing somewhat the purchase of more land, one of them, M., went to Europe, and the other, B., having been permitted to transact business in his individual name and being unable to communicate with M., purchased land and raised money upon notes, signed by himself, and upon M’s. return he consented to take a half interest in the land. Held, that the purchase was a partnership act fairly within the actual and apparent scope of the agency.
    Appeal from judgment of the supreme court, general term, fifth department, affirming judgment entered upon report of referee dismissing plaintiffs’ complaint upon the merits.

      Ansley Wilcox, for app’lts; George Clinton, for resp’ts.

       Reversing 44 St. Rep., 28.

   O’Brien, J,

This action was upon a promissory note of $5,000 against the defendants as partners. The appeal is from a judgment of the general term affirming a judgment on the report of a referee dismissing the complaint as to the defendant Marshall, and is based upon the judgment roll alone, there being no dispute as to the facts. The question is whether upon the facts found by the referee a defense was established.

The following is a copy of the note:

“ $5,000. Buffalo, Oct. 22, 1888.
“ One month after date I promise to pay to the order of A. Rumsey & Co. five thousand dollars at Manufacturers and Traders' Bank, value received. G. D. Briggs.”

This note was one of several renewals of another of the same tenor and amount, dated March 5, 1888, which the plaintiffs, constituting the firm of A. Rumsey & Co., indorsed, as they claim, for the defendants. The note in suit was discounted at the bank, and not having been paid when it became due, was protested, and the plaintiffs made liable thereon to the holder as indorsers. They subsequently paid the note, and in this action seek to collect from the makers. It is found, and there was no dispute as to that fact, that at the time the original note was made, and all the renewals, including that in suit, the defendants were partners.

The partnership agreement was in writing, and the firm, business was manufacturing and selling lumber, bark, railroad ties, and all other business relating thereto, under the firm name of George D. Briggs & Co., upon a tract of land in Pennsylvania known as“ Fair Bun,” and “ also upon any other tract of land which shall be purchased by said co-partners as hereinafter provided.” The defendant Marshall was a practicing lawyer, and took no active part in the management of the business. Briggs was the financial and business manager, giving to the business in all its details his personal attention. The firm name of G. D. Briggs was adopted with the consent of both partners in making notes and procuring them to be discounted for the transaction of the partnership business, and in that name, with like consent, firm property was sold, checks drawn on the funds of the firm in banks and deposits made. Prior to the month of January, 1888, the “ Fair Bun ” tract, from which the firm had obtained the lumber and timber, became substantially exhausted of its bark and timber. About that date the defendants had a consultation looking to the purchase of another tract of about 2,000 acres known as the “Bock Bun” tract, situated near their saw-mill on the old tract, but no conclusion was reached. On the 3rd of March, 1888, and while the defendant Marshall was in Europe, Briggs made a written contract with one Bouton, by which the latter was to purchase the Bock Bun property and convey it toAhe former, and this agreement was executed by a conveyance by the owners to Bouton and subsequently by him to Briggs. The property cost about $30,000, and Briggs paid, upon taking the title, about $22,000. This sum was all substantially raised upon notes, one of which was the original of the note in suit, leaving about $8,000 still due. In the meantime and about May 1, 1888,, the defendant Marshall returned from Europe, was informed by Briggs of the purchase and the amount still due, was asked te take a half interest in the property at the price paid, to which he consented. Both partners then engaged to borrow of a third party $20,000, to be secured by mortgage on the land. Briggs-having procured the title, executed the mortgage and then conveyed an undivided half to his partner. From the money raised on the mortgage the balance of the purchase price was paid and,, by consent of both partners, about $9,000 of it was used to pay off and discharge another mortgage on the “ Fair Bun ” property which they owned as partners. The balance of the loan was credited to Briggs, and thereafter they carried on their partnership business by using the land and taking the timber therefrom. Otherwise than thus described, Marshall never paid or advanced anything individually upon the land, Briggs becoming personally liable for the payment of the loan, while his partner did not. Mr. Marshall was notified by Briggs of the purchase about the time it. w.as made by letter addressed him at Paris, which was received but no reply made thereto. The referee found that the signature to the note was that of the partnership. The plaintiffs’ firm was. engaged in the business of manufacturing leather and used large quantities of bark in their business, a portion of which they had purchased prior to the transaction in question from the defendants through Briggs. One of the members of the firm, at least, knew that defendants were partners, and he was the person who indorsed the note in the name of the firm.

On the 5th of March, 1888, Briggs, desiring to raise money or procure credit to purchase the land, applied to this member of the plaintiffs’ firm to advance the money or to indorse a note upon which money could be raised, to be used in the business of the defendants’ firm. Briggs stated to the plaintiffs that he had an opportunity to purchase the land and desired to do so for his firm. That - Mr. Marshall, was absent, but had authorized the purchase, and, as he could not communicate with him in time, he desired then to close up the transaction, as it was necessary to proceed at once with their business, and, if he could complete the purchase, he would make a large contract with the plaintiffs for the bark. Believing and relying upon these statements, and without knowledge as to the actual name of defendants’ firm, the plaintiffs indorsed the note upon the credit and responsibility of the defendants. In November, 1888, Briggs failed, being insolvent, and it is found that Mr. Marshall had, in fact, no knowledge of the giving of the original note or renewals till that time. Other facts are found, and there are various requests for findings by both sides in the record, but it is believed that it is not necessary to refer to them in greater detail, as sufficient now appears to give a clear view of the legal question, upon the disposition of which the case depends. The learned referee held as matter of law that neither the original note nor any of the renewals were firm obligations and were not within the actual or apparent scope of the business of defendants’ firm, and, developing this idea still further, held that the purchase of the tract of land by Briggs was not within the actual or apparent scope of the business of his firm, and that the defendant Marshall was not bound by any of the representations made to the plaintiffs in relation to the purposes for which the note was given, and dismissed the complaint.

We think that this conclusion could not legally or properly follow from the facts found, and was, therefore, erroneous. R. L. Co. v. S. & P. P. Co.. 135 N. Y., 209 ; 47 St. Rep., 842.

The general authority and agency of Briggs, as a partner,coupled with the other fact, that, with the knowledge and consent of his co-partner, he was accustomed to transact the firm business in his own name, to make and discount firm notes and draw upon their proceeds in the same way for partnership purposes, conferred power upon him to make obligations and contracts binding upon the firm in his individual name, and it is conceded that the promise ■sued upon is, at least in form, that of the partnership. The plaintiffs have been defeated upon the ground that, though it is a firm note, it was not given in the firm business or within the actual or apparent scope of the agent’s authority, because the purchase of an additional tract of land was not a partnership act, but that of Briggs individually.

The partnership agreement provides for operations on a designated tract of land and “ upon any other tracts of land which shall hereafter be purchased by said co-partners, as hereinafter providedIf Therefore, the purchase of more land, when necessary, was contemplated as a part of the business and as a partnership act In the absence of a finding we cannot, upon an appeal on the judgment record alone, assume that the general powers to be implied from this provision of the agreement were regulated, limited or restricted by some subsequent provision in the same instrument ■or otherwise. R. L. Co. v. S. & P. P. Co., supra. Considering the circumstances that appear in this case, the fact that the timber on the old tract was exhausted that the purchase of more land was the subject of consultation between both partners, before one ■of them went to Europe that Briggs had been permitted by the ■other partner to transact the business in his individual name, we think that the purchase of the land when the other partner could not be communicated with was a partnership act fairly within the ■actual and apparent scope of the agency. It seems quite clear, upon the facts, that the absent partner could have claimed the benefit of the transaction and could have compelled Briggs to ¡account to the firm for the property or its proceeds or profits. Briggs was the general manager, with full charge of the business, .as well as a partner. His individual name was made by usage .and consent to represent the firm. The purchase of more land was within the general purpose and object of the partnership when necessary, and of that he was to be the judge. The making of the note and procuring the plaintiffs to indorse it upon the faith .and credit of the firm, in order to raise money to pay the purchase price, was a necessary and usual step in the acquisition of the •property. The power of Briggs to bind the firm by the note in suit, under the circumstances disclosed, is but a fair deduction from the general principles of law applicable to the powers of individual partners and the cases on the subject. Lindley on Part., 128, 129, 130, 131, 144, 146, 167—8; Parsons on Part., 94, .95, 170-2, 197-8; Chester v. Dickerson, 54 N. Y., 1; Johnston v. Trask, 116 id., 136 ; 26 St. Rep., 622 ; Union National Bank v. Underhill, 102 N.Y., 336 ; 2 St. Rep., 48; Dowling v. Exch. Bank, 145 U. S.. 512.

When the purchase of a piece of real estate is within the scope ■of the partnership business, which one of the partners is permitted by the other to manage and transact in his own name, ¡and the latter borrows money or procures indorsements from third parties in order to pay for the real estate on the credit of the firm, it will be bound by his act, though he takes the title in his own name.

But if the power to bind the firm by the transaction in which the note originated is considered in any degree doubtful, then it was competent for the other partner to ratify what had been ■ done in the name of the firm, and in that way to make the note binding upon both partners, and such, we think, is the legal result from the facts found. Marshall, on being informed ■of the purchase on his return from abroad, in effect, consented to treat the land as partnership property the same as the old ".tract, and took a conveyance of an undivided half interest. The finding is that Briggs informed Marshall of the conditions of the contract and the sale of the title, which was still in a third party, and proposed that they become the owners of the land as partners and operate the same under their existing partnership agreement, to which Marshall consented. Then the title was transferred to Briggs, who, by arrangement with his co-partner, mortgaged it in order to raise $20,000, $8,000 of which was used to pay the balance of the purchase price, about $9,000 more to pay a partnership debt, namely, a mortgage on the old tract, and the balance credited to Briggs in the firm account. Thus property of the value of $30,000, or at least which was purchased at that price, was transferred by Briggs-to the firm, subject to an incumbrance of $20,000. If it had been an individual and not a partnership transaction he would, have been entitled to the difference of $10,000 and the fruits of the loan made upon its security, less the balance of the purchase price, but upon the supposition that it was a partnership affair, the disposition made of these funds was in harmony with the-object and purpose of the parties.

The finding of the referee that after all this Marshall was not-aware of the giving of the note, of which the one in suit is a renewal, is quite immaterial. Knowledge of all the details was-not necessary, but it must be assumed that he knew Briggs had raised money in some way to pay $22,000, and he certainly knew •that his practice had been to raise money on notes, in precisely the same form, for the use of the firm. Under these circumstances his adoption of the transaction and acceptance of the-fruits of it bound him and the firm.

Where a principal adopts and ratifies the acts of his agent by-receiving the fruits of it or otherwise, he assumes responsibility for the instrumentalities which the agent has employed in his behalf to effect the contract. Bennett v. Judson, 21 N. Y., 238;. Elwell v. Chamberlin, 31 id., 611; Leslie v. Wiley, 47 id., 648; Garner v. Mangam, 93 id., 642.

For these reasons the judgment should be reversed and a new trial granted, costs to abide the event

All concur, except Andrews, Gh. J., and Finch, J., not. voting.


author: O’Brien, J.

text:
    Charles H. Kelly, App’lt, v. Joseph B. Bloomingdale et al., App’lts, and William F. Lawrence et al., Resp’ts.

      (Court of Appeals,

      Filed October 3, 1893.)

    1. Mechanics’ lien.
    Where by the terms of a building contract a certain percentage is to be-retained by the owner until its final completion, and the contract is never-completed by the contractors but the owners are compelled to complete the houses themselves at a cost greater than the price stipulated in the contract, the percentage never becomes due to the contractor and his sub-contractors have no other or different claim to it than he would have, and there is nothing in the statute or any rule of equity that will compel the owners to satisfy the lien of the sub-contractors out of the percentage; retained.

      3, Same—Payment after notice.
    The lien attaches and the rights of the claimant as against the owner and the property become fixed upon filing the notice, and a payment by the owner to the contractor with knowledge of the claim and after the notice of lien therefor has been filed, is inoperative under the statute against the lien of the material man.
    Appeal from judgment of the supreme court, general term, second department, affirming judgment entered upon report of ¡referee cancelling the liens of plaintiff and directing foreclosure of the liens of defendants Lawrence.

      Matthew L. Harney, for pl’ff-app’lt; Otto Horwitz, for app’lts Bloomingdale; James M. Hunt, for resp’ts.

       Affirming 46 St. Rep., 370.

   O’Brien, J.

The plaintiff is the assignee of the claim and lien of a mechanic who performed work and funished material under an agreement with a general contractor, in plumbing and furnishing the gas fixtures in two houses which the contractor agreed to build and complete for the owners, the two Blooming-dales, respectively. The owners and other mechanics or material men who had also filed liens were made defendants and answered, setting up defenses against the plaintiff’s lien which he sought to foreclose in the action. The referee dismissed the complaint, and reported with respect to the other liens, sustaining them against the plaintiff and the owners. The judgment entered upon the report having been affirmed at the general term, the plaintiff and the owners, the Bloomingdales, appeal to this court. The latter owned land as tenants in common, and on the 18th of March, 1890, the contractor agreed with each of them separately to build two houses on the land. The contract price with J oseph B. Bloomingdale was $11,460, and with his brother Lyman Gr. $13,700. The houses were to be built and completed on or before October 1 thereafter, but the contractor failed to perform and abandoned the work about August 6, 1890, and the owners were compelled to complete them themselves at a cost greater than the price stipulated in the contract. It was stipulated between the owners and contractors that payments should become due and payable “ from thirty days in such sum as shall be certified by the architect, but twenty per cent shall be retained until the final completion of the contractalso, that in all matters relating to the contract the architect should be deemed to be the agent of the owners. The plaintiff’s assignor performed work and furnished materials on one of the houses amounting to $710.79, and on the other to the amount of $907.04. He filed a notice of lien for these amounts on the 8th of August, 1890. The plaintiff’s appeal raises the question, whether at that date there was anything due to the contractor under the contract, not absorbed by prior liens, to which his lien could attach. The main contention on the part of the plaintiff, and the only one necessary to notice, is that, when his lien was filed, twenty per cent of the cost or value of the work done and materials furnished up to that time remained unpaid by the owners, and that as they have had the benefit of this work and material, a lien was impressed upon that sum, amounting to about $14,000, in favor of the plaintiff. This proposition cannot be sustained. The twenty per cent, was, by the contract which the owners made, to be retained by them till the final completion of the contract. It never was completed, and, hence, this part of the price never became due to the contractor; and his sub-contractors have no other or different claim to it than he would have. It was retained in order t.o secure the owners from loss by the contractor’s default, and the right to demand it by any one depended upon the substantial performance of the contract, a condition which was never fulfilled. Even with this sum retained, the owners still were at a loss on account of the default, as they paid in all a sum greater than the price agreed upon. Under such circumstances, there is nothing in the statute, or any rule of equity, that will compel the owners-to pay the plaintiff’s claim.

This is the only question presented by the plaintiff’s appeal that requires discussion, and as, at the time the notice was filed, there was nothing due to the contractor upon the contract, and nothing became due or payable to him subsequently, no lien was acquired. Larkin v. McMullin, 120 N. Y., 206; 30 St. Rep., 902; Van Clief v. Van Vechten, 130 N. Y., 571; 42 St. Rep., 736; Lauer v. Dunn, 115 N. Y., 405; 26 St. Rep., 412.

The other question in the case arises between the defendants, and is presented by the owners’ appeal from that part of the decision which upholds the lien and claim of the defendants Lawrence, who furnished the lumber used by the contractor before he abandoned the work. The facts out of which this part of the controversy arises are these : On July 16, 1890, there was due to-Lawrence about $1,900 for lumber ordered by the contractor, and notice of lien therefor was filed July 19. About $500 more lumber was subsequently furnished, for which liens were filed July 27th. On the 21st of July the owners paid to the contractor $2,600, upon the certificates of the architect, in pursuance of the contract, showing that such sums were due, bearing date July 18th, and stating upon their face that a notice of the Lawrence claim for lumber had been filed. The architect, who, by the terms of the contract, was the agent of the owners, bad been shown copies of the notices of lien before he made the certificates, though they were not actually filed until the next day. The owners also had actual personal knowledge of the claim before they made the payment. Under a provision of the contract the owners were not bound to make any payment to the contractor until he satisfied them, if required, that material men and sub-contractors had been paid. We will not stop to inquire what equities arose upon these facts between the material men and the owners independent of any statute.

The question is, whether the payment by the owner to the contractor with full knowledge of the claim, and after notice of lien therefor had been filed, is operative under the statute against the lien of the material man. The owners claim that it is, and this contention rests solely upon the words of the last clause of § four of the act. After providing for service of a copy of the notice upon the owner within ten days after filing, the section concludes in these words: “And after such service, such owner or the person in interest shall not be protected in any payment made to subcontractor or other claimant.” The notice was served upon the owners within ten days after filing, but not until after the payment to the contractor.

Notwithstanding this language, it is apparent from the whole statute that the lien attaches, and the rights of the claimant as against the owner and the property become fixed upon filing the notice, and so it has been held by this court. McCorkle v. Herrman, 117 N. Y., 303; 27 St. Rep., 333; Kenney v. Apgar, 93 N. Y., 541; Hall v. Sheehan, 69 id., 618.

We are required to give to this statute a liberal construction, but to hold that, after the notice is actually filed, the owner is still at liberty to make payments the same as before in disregard of it, because he had not been actually served with the copy provided, for, would be to defeat in many cases its beneficial purposes. Whatever may have been intended by the language quoted, it is certain that it does not in words or by any fair implication protect the owner who pays before the notice is served and after it is filed. The meaning of the statute is to be ascertained, not from a single expression, but from all of its provisions as well as the general scope and purpose in view.

Moreover, it should be noted that although the copy of the notice had not been served when the payment was made, yet the owners had in another way not only constructive notice of the lien, but actual notice of the claim, and the fact that the notice was to be immediately filed. There was, we think, no error in the disposition made of the ease below, and the judgment should be affirmed, with costs in this court to the owners against the plaintiff, and to the defendants Lawrence against the owners.

All concur.


author: Andrews, Ch. J.

text:
    The People ex rel., The Hamilton Park Co., App’lt, v. Edward Wemple, Comptroller, et al., Resp’ts.

      (Court of Appeals,

      Filed October 3, 1893.)

    Taxes—Sale—Cancellation.
    The owner of land sold for taxes is not entitled under chap. 217, Laws of 1891, to apply to the comptroller for the cancellation of a tax sale, and the comptroller has no jurisdiction to entertain and act upon an application by the owner for such cancellation.
    (Earl and Maynard, JJ., dissent.)
    Appeal from judgment of the supreme court, general term, third department, confirming order of the comptroller cancelling three tax sales, and quashing writ of certiorari.

    This is an appeal in a proceeding instituted by writ of certiorari, brought for the purpose of reviewing the decision of Edward Wemple, late comptroller of the state of New York, made December 30, 1891, cancelling three several tax sales made by the state in the years 1877, 1881 and 1885, of lands in the town of Long Lake, Hamilton county, for taxes. The sale of 1877 was for taxes assessed in the years 1867 to 1870 inclusive. The sale of 1881 was for taxes assessed in the years 1871 to 1876 inclusive, and the sale of 1885 for taxes assessed in the years 1877 to 1882 inclusive. The comptroller, on the 29th day of January, 1884, executed to the purchasers on the tax sales of 1877 and 1881 conveyances of the lands sold, which were recorded December 10, 1888, and made a similar conveyance April 9, 1889, of the lands sold at the tax sale of 1885, which was recorded December 22, 1889.
    The relator, the Hamilton Park Company, is the grantee of the purchasers at the three tax sales mentioned, by deed dated May 1, 1889.
    On the 9th day of December, 1885, the Adirondack Eailway Company, a railroad corporation organized July 7, 1882, presented its petition, duly verified, to the comptroller for the cancellation of the three tax sales of 1877, 1881 and 1885, of two parcels of land aggregating 3,000 acres, in township 36, in Totten & Crossfield’s purchase, in the town of Long Lake, on the ground that it was the owner of the land as successor of the Adirondack Company, a railroad corporation organized under chapter 236 of the Laws of 1863, and that the lands were, by virtue of that act and subsequent amendatory acts, exempt from taxation during the years 1867 to 1882 inclusive. This application was denied by the comptroller June 23, 1888, on the ground that the owner of the lands sold for taxes was not authorized under the statute to apply to the comptroller for the cancellation of tax sales, and that the purchaser was the only party entitled to make such application.
    Subsequently, on the 17th day of November, 1891, the Adirondack Eailway Company, on a new verified petition, applied to the comptroller for a re-hearing and re- consideration of its previous application, setting forth as in the first petition the grounds upon which application for cancellation was made, which were in sub.stance the same as were stated in the petition of Dec. 9, 1885. Other parties claiming as owners or mortgagees of lands affected by the tax sales were allowed to intervene. A hearing was had before the comptroller of the application of Nov. 17, 1891, at which the petitioners and the relator were present. The petitioner, in support of its application for cancellation, introduced papers purporting to be an abstract of title, showing the ownership of the lands by the Adirondack Company during the years in which the taxes were assessed, accompanied by written statements as to the performance of the conditions of exemption imposed by the act of 1863, and subsequent amendatory acts. Affidavits were also introduced tending to show that the taxes on the lands, and for which they were sold, were not extended by the board of supervisors of Hamilton county when the tax rolls were delivered by the board to the supervisor of the town, and that the .board never acted upon any extension or had any cognizance of the rolls after they were delivered to the supervisor.
    On the 30th day of December, 1891, the comptroller made his decision in writing, granting the application for cancellation on the grounds (1) that the lands were exempt from taxation under chap. 236 of the Laws of 1863, and amendatory and subsequent acts; (2) that the taxes were void by reason of the non-extension of the taxes by the board of supervisors on the tax rolls. The return shows that the relator appeared on the hearing before the comptroller and opposed both the applications of 1885 and 1889, and by counsel submitted briefs in opposition. The relator gave no evidence on the hearing, nor does it appear that it interposed any objection to the evidence offered by the petitioners as to its form or otherwise.
    The certiorari is taken by the relator to review the decision of the comptroller cancelling the tax sales. The decision recites that it was made “ in accordance with the requirements of. chap. 217, Laws of 1891.”
    The general term affirmed the decision of the comptroller, and from the order of affirmance this appeal is taken by the relator.

      Esek Cowen, for app’lt; Arthur L. Andrews, for resp’ts.

       Reversing 51 St. Rep., 230.

   Andrews, Ch. J.

The point urged by the relator, that the •owner of land sold for taxes is not entitled under the statute to apply to the comptroller for the cancellation of a tax sale, or that the comptroller has no jurisdiction to entertain and act upon an application by the owner for such cancellation, is, if well taken, decisive of the case, and requires a reversal of the proceedings.

The decision of the comptroller now under review, which canceled tax sales of 1877, 1881 and 1885, of lands in Hamilton county, was rendered on the application of the Adirondack. Bail-way Company, made Bov. 17, 1891, as owners of the lands by grant from the Adirondack Company. The application was made on the ground that the lands in question were, during the years in which the taxes were assessed, upon which the lands were sold, exempt from taxation under chap. 236 of the Laws of 1863, and subsequent statutes. The comptroller entertained the petition of the Adirondack Bailway Company, and against the protest and objection of the relator, the Hamilton Park Company, the grantee of the purchasers on the tax sales, rendered his decision Dec. 30, 1891, canceling the several sales in the years mentioned on the ground stated in the petition and on the additional ground embraced in the general claims of the petition, that the board of supervisors of Hamilton county had omitted to extend on the tax rolls of the town of Long Lake the taxes -for which the several tax sales were made before delivering the rolls to the supervisor of the town.

The action of the comptroller was taken, therefore, upon the application of the owner of the lands at the time of the several tax sales, or his grantees, and the right of the owner of lands sold for taxes to institute the proceedings for cancellation, and of the comptroller to adjudicate on his application the respective rights of the owner and of a purchaser on a tax sale, is distinctly presented and must be determined.

The question is not wholly new in this court. In the case of People ex rel. Wright v. Chapin, 104 N. Y., 369; 6 St. Rep., 837, the question was presented, and was elaborately considered by the court, whether the owner of lands sold for taxes was entitled, under chapter 427 of the Laws of 1855, to the remedy provided for by that act for the cancellation of tax sales on application to the comptroller. The act of 1855 consolidated the previous legislation on the subject of tax sales, and regulated the proceedings on the sale by the state of lands for unpaid taxes, and by the 83d and 85th sections power was conferred on the comptroller to cancel invalid tax sales, and upon such cancellation he was required to refund to the purchaser, out of the state treasury, the purchase money and interest thereon. It is unnecessary to quote the sections here. They are quoted in the opinion in the case cited. The court on the first argument, and afterwards on a motion for reargument, unanimously decided that the object and intent of §§ 83 and 85 was to relieve a purchaser who had purchased land at a tax sale, which was invalid, from his purchase, and to provide for a prompt restitution of the money paid by the purchaser. It was, therefore, held that the owner ef land who had applied to the comptroller for the" cancellation of a sale of his land for taxes, and where application had been denied, could not maintain an appeal from the decision of the comptroller. Dan-forth, J., in his opinion, after referring to §§ 83 and 85 of the Laws of 1855, said: “ The evident object of these provisions was to enable the state to relieve the purchaser from the consequences of a defective tax title, and at the same time to replenish the treasury by a speedy collection of the tax withheld from it. The owner is not a party to the proceeding, nor is he permitted in this way to test the validity of the sale or tax. In such a controversy the purchaser would have an interest and a right to the protection of the court by the usual course of legal proceedings. The statute contains no intimation of a legislative purpose to deprive him of this right. It gives no process to bring him in, confers no power to compel witnesses. In short, it creates no court, provides for a single transaction, to which the comptroller and the purchaser are the only parties.” In reviewing the grounds of this decision we are fully satisfied that it accords with a sound construction of the act of 1855. If the statute was intended to make'the comptroller a tribunal to decide controversies between the owner and the purchaser as to the validity of a tax title, it is singularly deficient in provisions for securing the due consideration and hearing of the controversy, and in providing the safeguards which ordinarily surround and attend judicial investigations affecting questions of title to land arising between conflicting claimants.

The validity of a tax title frequently is a question of great difficulty, and involves important and valuable interests, not only of the owner whose title is claimed to have been divested, but of a purchaser, who, in reliance upon the validity of his title, may have made valuable improvements on the property. The comptroller may be a person not familiar with legal questions or investigations. The act of 1855, as Judge Danforth points out, makes no provision for bringing the claimants before the comptroller, provides for no notice to the adverse party, prescribes no rules for the examination and cross-examination of witnesses, and, as we held in People ex rel. Ostrander v. Chapin, 105 N. Y., 309; 7 St. Rep., 209, the comptroller may accept affidavits in place of common-law proof of any facts relevant to the application. There is no provision for an appeal from the comptroller’s decision, and if his decision might, prior to the amendment of 1891, have been reviewed on certiorari, it would be subject to the rules governing a review under that act. It is difficult to suppose that the act of 1855 intended to constitute the comptroller a court to decide controversies between the owner of lands sold for taxes and the purchaser as to the validity of a tax title.

On the other hand, if the provisions in the act of 1855 as to cancellation of tax sales were intended merely to afford a remedy to the purchaser to recover back the money paid on an invalid sale, the act established a consistent system, easily understood and productive of no injustice. The purchaser by his application consents to a cancellation of the tax. The state by its officers consider and pass upon the application, and is the only party, other than the purchaser, interested. The owner of the land cannot complain if the sale is vacated, and if the application is denied his position is not changed. The county which may be required to relevy the amount refunded is one of the municipal divisions of the state, and is represented in the transaction by the state officers. If the comptroller acts under § 83 on his own motion, and vacates the sale before the conveyance is made, the purchaser gets back his money, and he cannot complain, because he purchased subject to the right of the comptroller to exercise this power. The construction of the act of 1855 established by the decision in People ex rel. Wright v. Chapin, supra, was reasserted in the case of People ex rel. Ostrander, supra, in which Rapallo, J., said: •“ The intent was to protect the title of the purchaser in case the sale was found to be ineffectual to give him title. ” In the subsequent case of People v. Turner, 117 N. Y., 227; 27 St. Rep., 158, which was an action to recover penalties for cutting timber on lands in Franklin county, title to which was claimed by the state under a tax sale made in 1877, the defendant, without connecting himself with title to the land in any way, sought to defeat the action on the ground that the plaintiff’s title was defective for the reason that the assessors, in assessing the taxes on which the land was sold, had omitted to give notice of a review of the assessments, as required by law. The court, in its opinion, after giving several conclusive reasons in answer to this defense, assigned as an additional reason that the owner whose lands were assessed had a remedy under the act of 1855, to apply to the comptroller for the cancellation of the tax. Ho reference was made to the decision in 104 N. Y., and the suggested construction of the act of 1855, in hostility to that decision, was a mere inadvertence. Unless, therefore, the right of an owner, whose lands have been sold for taxes, to apply to the comptroller of the state has been given by some statute subsequent to 1855, no such right exists. The comptroller, as authority for exercising this jurisdiction, relied upon chapter 217 of the Laws of 1891, which _ amended § 2 of chapter 448 of the Laws of 1885, which itself was an amendment of the law of 1855. The act of 1885 enacted a rule of evidence by making, certificates of tax sales and conveyance thereunder in certain cases, and after a certain time, conclusive evidence of the validity of the sale and of the prior proceedings, whereas, by the act of 1855, a conveyance by the comptroller was made presumptive evidence only.

In the opinion in People ex rel. Wright v. Chapin, supra, given on the motion for re-argument, the judge delivering the opinion, referring to the statute of 1885, stated, in substance, that it did not extend the power of" the comptroller in respect to cancellation beyond that given by the act of 1855. Section 1 of the act of 1885 amends § 65 of the act of 1855, the main purpose of the amendment being, as has been stated, to create a conclusive presumption of regularity in the cases mentioned. It confers no new power upon the ' comptroller in express language. The section is very obscure, and it may afford ground for an argument that the legislature, by the concluding clause in the section, intended to give the owner a remedy to apply to the comptroller for cancellation where the taxes had been paid before the sale, or where the land taxed was not taxable.

On the other hand, the intention may have been not to preclude the purchaser from applying for cancellation in these cases, the objections being fundamental, and which, it might be claimed, would not be reached by a curative statute, or by a statute en-. acting a conclusive rule of evidence in support of the purchaser's title. Section 2 of the statute of 1885 was the one amended by the statute of 1891, and the original section in the act of 1885 contained nothing bearing upon the point we are now ■ considering. The act of 1891 added to the original section this clause, which is the one relied upon to sustain the action of the comptroller in this case: “All applications heretofore or hereafter made to the comptroller for the cancellation of any tax sale by any person interested in the event thereof, shall be heard and determined by him, and his determination shall be subject to review by certiorari or otherwise.” It will be observed that there is no express grant of power in this clause to the comptroller to entertain and adjudicate upon the validity of tax sales on the application of the owner of lands affected thereby. The act of 1891 was passed several years after our decision in People ex rel. Wright v. Chapin, and may be presumed to have been known by the legislature. It is quite significant that if the legislature intended to confer the additional power upon the comptroller to cancel tax sales upon the application of the owner, it was not expressed in unequivocal terms. The clause quoted from the act of 1891 contains two new affirmative provisions. It makes it imperative upon the comptroller to hear and determine applications for'cancellation, which, prior to our decision in People ex rel. Ostrander v. Chapin was regarded by him as discretionary, and next, it gave in express terms a remedy by certiorari to review his decision. The position of the purchaser, if the right of cancellation is still confined as in the act of 1855, gained these advantages, and his rights were relieved from the obscurity which before attended them. It is, however, upon the language of the act of 1891, directing the comptroller to hear an application for cancellation “ by any person interested in the event thereof,” upon which the defendants rely as extending the power of the comptroller so as to embrace application by the owners of the property sold for taxes, as well as purchasers. Looking to the policy of the act of 1855 in conferring power on the comptroller to cancel tax sales, which was to encourage bidding and to provide a speedy and summary remedy in favor of purchasers to recover back the purchase money where the purchaser could acquire no title by reason of the invalidity of the proceedings, the words “ interested in the event thereof,” in the act of 1891, would most naturally refer to persons interested in the refunding of the money paid, which was the primary object of applications for cancellation under the act of 1855. The cancellation of the tax sale and the refunding of the money paid thereon were to be simultaneous acts, and an owner whose land had been illegally sold for taxes, although he might have an interest in having the cloud upon his title removed, did not need the remedy by cancellation to preserve his rights, and he was not interested in the refunding to the purchaser of the money paid on the sale, and so not in the event of the application for cancellation in its main purpose.

We are of opinion that the statute of 1891 has not changed the prior rule, and that now, as before, the owner is not entitled to the remedy by cancellation. The construction of the obscure legislation is not free from difficulty. If the legislature should deem it wise to extend the scope of the powers of the comptroller' to the determination of controversies between the owner and purchaser of land sold for taxes, new and additional legislation should be enacted containing provisions which shall insure a. deliberate hearing upon competent evidence with the usual safeguards which attend ordinary judicial trials.

These views lead to a reversal of the proceeding below, and costs should be awarded to the relator in all courts.

Order and judgment reversed, with costs to relator in all courts.

All concur, except Earl and Maynard, JJ., dissenting. ,<ci


text:
    Franklin D. Newton, App’lt, v. Gertrude E. Lee et al., Resp’ts.

      (Court of Appeals,

      Filed October 3, 1893.)

    Pleading—Set ope.
    In an action by an assignee of a claim for goods sold and delivered, the answer denied the allegations of the complaint and then for a second defense alleged that a written contract had been made between the A. B. Co. and plaintiff’s assignor, the N. Co., by which the latter company agreed to iurnish to the former certain castings; that the 3ST. Co. failed to perform its contract so that A. B. Co. was compelled to shut down at a loss of $5,000, which defendants claimed to set ofE against plaintiff's cause of action. Defendants also alleged that they were privy to the contract by guaranteeing the payment of the accounts owing by the A. B. Co. to the K. Co. Held, that the answer was demurrable.
    Appeal from judgment of the supreme court, general term, second department, affirming an interlocutory judgment overruling demurrer to a portion of the answer,

      Nelson S. Spencer, for app’lt; John W. Perry, for resp’ts.

       Reversing 53 St. Rep., 162.

   Andrews, Ch. J.

The demurrer to the second answer or defense was, we think, well taken. The complaint was in the ordinary form for goods manufactured for, and sold, and delivered to the defendants at their request by the plaintiff’s assignor, the Naugatuck Malleable Iron Company, for an agreed price, with averments of the assignment of the claim to the plaintiff, and that the debt was due and unpaid.

The answer in the first instance contained a denial of the allegations of the complaint, and then “for a further and separate answer and defense,’’ the defendants alleged that the transactions set forth in the complaint as being made with the defendants were had with the American,Bit-Brace Company, a New York corporation, and not with the defendants, or either of them, and that that corporation should be a party defendant.

The answer then alleges “ in that behalf,"’ that at a date stated, a written contract was entered into between the American Bit-Brace Company and the Naugatuck Malleable Iron Company, by which the latter company agreed to furnish to the American Bit-Brace Company castings from patterns it should furnish, on monthly orders; that the Naugatuck company failed to perform its contract to furnish the castings upon monthly orders made by the bit-brace company in time, as it was bound to do, by reason of which default the bit-brace company was compelled to shut down its works for ten days, and thereby it sustained damages in the sum of $5,000, which “ these defendants are entitled to recoup and set off as a counterclaim against the pretended cause of action set forth in the complaint.” It is further alleged that the defendants “became privy to the contract” by guaranteeing the pay-' ment of all accounts owing by the bit-brace company to the Naugatuck Iron Company and were only sureties, and that this is the only basis of the claims set forth in the complaint, and that the defendants are entitled to avail themselves of the “ defense and counterclaim existing in behalf of the American Bit-Brace Company to the extent of any demand made against them by the plaintiff herein.”

The complaint concludes by a demand for judgment in the alternative, dismissing the complaint, or that the bit-brace company should be made a party defendant and judgment be awarded in its favor, “ as such party defendant, for $5,000,” or that the defendants be allowed to recoup and set off so much of said sum “ as a counterclaim in their own right ” as shall extinguish the plaintiff’s demand.

The second defense, assuming the facts therein stated to be true, has no relation to the cause of action set forth in the complaint. The complaint is upon a contract of sale and delivery to the defendants. The plaintiff would be bound to prove this cause of action in order to entitle him to recover. The action would not be supported by proof that the goods were sold to the American Bit-Brace Company, and that the defendants were guarantors of its liability. A cause of action against them as guarantors is a different cause of action from the one alleged in the complaint. The defendants are not sued as sureties or guarantors, but as purchasers of the goods.

Assuming that the defendants, if they had been sued as guarantors or sureties, might avail themselves of a breach of the contract by the Naugatuck Iron Company, and recoup any damages suffered by their principals therefrom, in the actual situation no defense was relevant except one based upon a denial that they ordered or purchased the goods, or upon a discharge or satisfaction in whole or pro tanto of their liability as purchasers, or growing out of a set-off or counterclaim existing in their favor against the plaintiff or the Naugatuck Company.

The defense set up in the second answer is to a cause of action, not alleged by the plaintiff, and which could not be shown on the trial. It is an attempt to defend a cause of action not sued upon, and such a defense is demurrable because it does not answer the complaint, and is “ insufficient in law.” Code Civ. Pro., § 494. The defendants may doubtless prove on the trial any facts tending to show they were not the purchasers of the goods, and, as bearing upon this issue, that they were mere guarantors or sureties. This they would be permitted to do under their denial in their answer preceding the second alleged defense.

But they would not be entitled to prove this fact as a basis for the further claim that the bit-brace company were the real purchasers, and as such had a claim for damages for a breach of the contract against the Naugatuck Iron Company. If the defendants were the purchasers there was no contract with the Naugatuck company for the breach of which any damages could accrue to the bit-brace company. If the bit-brace company were the purchasers, and the defendants were guarantors only of the liability of that company, then the action is misconceived, and even if the defendants had been sued as guarantors or sureties upon the collateral undertaking, they could not avail themselves, in exoneration of their liability, of a cause óf action for dam ages for a breach of the contract existing in favor of their principals. Gillespie v. Torrance, 25 N. Y., 306; Davis v. Toulmin, 77 id., 280. The complaint alleges no assignment of the claim for damages to the defendants, nor is there any allegation of insolvency or other ground of equitable jurisdiction.

The second defense, treating it as a whole, is clearly bad. But the claim is made, based upon the preliminary allegations therein, that the contract for the sale of the castings was with the bit-brace company and not with the defendants ; that the demurrer is too broad since these allegations in substance deny the contract alleged, and, therefore, alone constitute a good answer to the complaint, and that the other parts of the answer may be disregarded or rejected. But this is too technical a view of the subject. The allegations referred to are introductory merely to the substantial matter intended to be set up by the answer, viz., the counterclaim existing in favor of the bit-brace company. The answer is to be judged as a whole. The averment that the goods were sold to the bit-brace company and not to the defendants was essential to explain the counterclaim alleged in the answer.

We do not perceive the force of the claim that the second answer is not “new matter” within § 494 of the Code. The matter stated therein is pleaded as a counterclaim to defeat a recovery. New matter pleaded as a defense is properly preceded by a confession of the cause of action. There is no confession in the answér demurred to of the original liability of the defendants. This could" not have been done without defeating the purpose of the answer. The vice of the defense, based upon a cause of action in a. third party, is exposed by the necessity imposed upon the defendants, of averring that they were not the purchasers of’ the goods. A defendant cannot claim that a defense does not consist of “ new matter ” for the reason that his pleading is defective-in form, if it sets up a counterclaim which upon the facts averred: is not available to the party pleading it.

This view leads to a reversal of the judgments of -the general and special term, and judgment should, therefore, be entered sustaining the demurrer, .with costs in all courts.

All concur.