text:
    Joseph E. McAllister, Resp’t, v. Lyman Bailey et al., App’lts.

      (Court of Appeals, Second Division.,

      Filed October 6,1891.)

    1. Attachment—When sheriff cannot levy upon money in the hands OF AN ASSIGNEE FOR BENEFIT OF CREDITORS.
    The proceeds of the sale by an assignee for the benefit of creditors of property held by him as assignee cannot be levied on by the sheriff by virtue of an attachment issued against the property of the assignors.
    3. Conversion—When payment not voluntary.
    Plaintiff, the assignee, upon a demand being made for the money by the sheriff, upon an attachment, drew it from the bank, laid it on the table, but forbade the sheriff taking it. Held, that the taking under the circumstances constituted conversion and was in no sense a voluntary payment on the part of the plaintiff.
    Appeal from a judgment of the general term, third department, affirming a judgment entered upon a verdict directed by the court at the St. Lawrence circuit.

      V. P. Abbott, for app’lts; E. H. Neary, for resp’t.

       Affirming 16 N. Y. State Rep., 484.

   Haight, J.

This action was brought for the wrongful taking and conversion of $7,197.64.

The defense was that the defendants, as sheriff and under sheriff, levied on the same under an attachment issued in an action in which the White Sewing Machine Company was plaintiff and Sylvanus B. Stinson and James J. Rutherford were defendants.

It appears that Stinson and Rutherford had made an assignment for the benefit of creditors to the plaintiff; that the plaintiff, as such assignee, had sold and converted the property into money which he had deposited in his own name in the Bank of Grouverneur. Thereupon the defendant Bailey undertook to levy upon such .money and for that purpose served upon the plaintiff a copy of the attachment and at the same time delivered to him a written notice annexed, to the effect that he attached all the money and other proceeds which had come to the hands of the plaintiff by reason of the sale of the stock of goods formerly in the possession of Stinson and Rutherford, and required him to deliver over such money, certificates of deposit and bank books, etc. The plaintiff then caused to be served upon defendant a certificate as to the amount of money that had come to his hands from the sale of the goods before mentioned; that the same was on deposit in the Bank of Grouverneur, and that he objected to the defendants attaching the same and demanded the immediate surrender of the money and bank books so attached.' Thereupon the defendant Smith, at the instance of the defendant Bailey, called upon the plaintiff and again demanded the surrender of the money under the attachment. After which the plaintiff drew the money from the bank, placed it upon a table and then told the defendant that that was the money, but that he forbade his taking it The money was thereupon taken by the defendants and this action was brought.

Upon the argument of this appeal the counsel for the respective parties conceded that the sheriff could not properly levy his attachment upon the money which the plaintiff had realized from a sale of the assigned property. Thurber v. Blanch, 50 N. Y., 80; Castle v. Lewis, 78 id., 131-136; Anthony v. Wood, 96 id., 180.

It was claimed, however, that the transaction was, in effect, a voluntary payment of the money to- the defendants, and that consequently it could not be recovered back by the plaintiff. Numerous authorities are cited in support of this contention. They are to the effect that moneys paid under a mistake of the law, but with a full knowledge of the facts, cannot be recovered back. We cannot see that the principle established in those cases has any application or bearing upon that under consideration. The defendants, as sheriffs, had an attachment which they pretended to levy upon the money in question. The plaintiff claimed the right to hold the same as assignee for the benefit of creditors, and objected to their levying upon the same. The defendants still asserted their right to the possession of the fund, and demanded its surrender. It was under these circumstances that the plaintiff went to the bank, drew the money and laid it upon the table. He did not hand it over or pay it to the sheriff; on the contrary, he forbade him to take it.

It seems to us clear that the taking by the defendants under these circumstances constituted a conversion, and that it was in no sense a voluntary payment on the part of the plaintiff.

The judgment should, therefore, be affirmed, with costs.

All concur.


source: Caselaw Access Project

author: Bradley, J.

license: Public Domain

text:
    George E. Jennings et al., Resp’ts, v. The Grand Trunk R. Co. of Canada, App’lt.

      (Court of Appeals, Second Division,

      Filed October 6, 1891.)

    1. Cabiuebs—Liability to deliveb at destination—When not limited BY CONDITIONS IN SHIPPING BILL.
    S. & Co. having obtained from defendant’s agent through rates from certain stations in Canada to Bast St. Louis, directed the shipping of a large quantity of potatoes at different points to them at such destination. Defendant’s shipping bills limited their responsibility to their own lines, etc. Held, that under the circumstances the defendant’s contract was one for transportation of the property to the place of destination, and the provisions and conditions upon the shipping bills, so far as they may be otherwise construed, were not applicable to the shipments in question.
    3. Same.
    The provisions that defendant would not he responsible for delay in the transit of the property did not have the effect to relieve it from the consequence of delay caused by its negligence, as exemption from liability for that cause was not expressed in the contract.
    3. Same—Notice of claim fob damages.
    It is legitimate for a common carrier, by contract with the shipper, to provide for a reasonable time within which notice of claim for loss or damage shall be given as a condition of liability, and the manner of giving it, but to limit the time, under these circumstances, within which the shipper could give notice to thirty-six hours after delivery of the goods was unreasonable; and a failure to give such notice was no bar to the remedy.

      Appeal from judgment entered upon order of the general term of the supreme court in the fifth judicial department, affirming judgment entered on report of referee in favor of the plaintiffs.
    For shipment and transportation to Bast St. Louis, Illinois, J. H. Shanley & Co. caused to be delivered to the defendant, and the latter received potatoes at the times, places and in the quantities following:
    April 18, 1881, at Prescott, Canada, 401 bushels.
    April 18, 1881, at Bdwardsburgh, Canada, 812 bushels.
    April 18, 1881, at Brockville, Canada, 400 bushels.
    April 20, 1881, at Brockville, Canada, 400 bushels.
    April 26, 1881, at Kingston, Canada, 402 bushels.
    The potatoes belonged to J. H. Shanley & Co., who were named as consignees of all the potatoes except those delivered to the defendant at Prescott. They were consigned to the order of the Merchants’ Bank of Canada with directions to advise Shanley & Co., and all the potatoes reached the place of destination except those shipped at Prescott. They did not arrive there. The purpose of this action was to recover damages alleged to have been sustained by the negligence of the defendant in its failure to transport those last mentioned to the place of destination and for their loss in consequence, and in delaying the delivery at Bast St. Louis of those which did reach there, by reason whereof the potatoes were injured and the market price, had fallen when they did arrive at that place. The claim of Shanley & Co. against the defendant was assigned to the plaintiffs. The referee found the facts in support of it, and directed judgment against the defendant. The defendant’s railway is within the Dominion of Canada, of which it is a corporation. Its most westerly station is Point Edward, but its practical western terminus is at Fort Gratiot, in the state of Michigan, where connection is made with other railroads extending west.
    The plaintiffs gave evidence to the effect, and the referee found that on February 8, 1881, Shanley & Co. wrote a letter to the defendant’s agent at Toronto, requiring the lowest rates for shipment of potatoes in carload lots from Prescott and other stations in that vicinity on its railway to Bast St Louis, Illinois, and certain other places, and on the 12th of that month received answer by letter from the defendant’s assistant general freight agent, saying: “ I will give you the following rates on potatoes in full carloads from Prescott and stations in the vicinity to * * * Bast St. Louis, 28 cents. Be good enough to let me know if these rates are accepted before shipping so that I may advise our agents.” That the rates so given were for each one hundred pounds; that on or before April 18, 1881, Shanley & Co. duly accepted such rates and notified such .assistant general freight agent of such acceptance, who, on or prior to that day, so advised defendant’s local freight agents at Prescott and stations in that vicinity ; and that no notice was given to Shanley & Co. by the defendant or any of its agents that the defendant would not assume the duties and liabilities imposed by law upon common carriers in the shipments of potatoes and their transportation between the points and for the rates mentioned. The alleged defense is that the defendant was not chargeable with the consequences of delay or negligence in the transportation of the potatoes beyond its own railway Ene; and that there were certain limitations in the contract of affreightment which relieved it from liability, and certain conditions precedent which the plaintiffs’ assignors failed to observe. And to support its defense the defendant put in evidence shipping bills termed therein shipping notes similar in form, one of which was as follows:
    “Grand Trunk Railway Company of Canada.
    “ This company will not be responsible for any goods missent, unless they are consigned to a station on their railway. Rates, weights and quantities entered on receipts are not binding on the company, and will not be acknowledged. All goods going to or coming from the United States will be subject to customs charges, etc.
    “Prescott, Date, April 18, 1881.
    “The Grand Trunk Railway Company of Canada will please receive the undermentioned property, in apparent good order, addressed to
    “ J. H. Shanley & Co.,
    “East Sfc Louis, 111,
    “ To be sent by the said company, subject to the terms and conditions stated above, and on the other side, and which are agreed to by this shipping note, delivered to said company as the basis upon which their receipt is to be given for said property.
    “ No. of packages and species of goods. Marks. Weight, lbs.
    “Paid on....................
    ................. 24,000
    “ 1 ca.r potatoes, said to contain
    400 bushels in bulk, 0. Risk G. T.
    Car 8679
    “Via Chi. and Alton R. R.
    “ 19.42 “ 80.58
    “100.00
    “ J. E. Du Brule, Consignor.”
    • Amongst the terms and conditions on the other side of this paper were the following:
    “General Notices and Conditions on Carriage.”
    “1. It is agreed and understood that the Grand Trunk Railway Co. of Canada will not be responsible for goods of any kind conveyed upon this railway unless receipted for by a duly authorized agent of the company.”
    “ 3. Nor will the company be liable for damages occasioned by delays caused by storms, accidents, over-pressure of freight or unavoidable causes, or by the weather, wet, fire, heat, frost, or delay of perishable articles, or from civil commotion.”
    “ 5. And in all cases where herein not otherwise provided, the delivery of goods shall be considered complete, and the responsibility of the company shall terminate when the goods are placed in the company’s sheds or warehouse (if there be conveniences for receiving the same) at their final destination, or when the goods shall have arrived at the place to be reached on said company’s railway.”
    “ 6. Lumber, coals, bricks and all other goods carried by the carload shall be taken as delivered, and the company’s responsibility in respect thereof shall cease, upon the car in which they are carried being detached from the train at the station on the company’s line to which it is consigned, or at the station where, in the usual course of business, it leaves the company’s line.”
    “ 10. That all goods addressed to consignees at points beyond the places at which the company has stations, and respecting which no direction to the contrary shall have been received at those stations, will be forwarded to their destination by public carrier or otherwise, as opportunity may offer, without any claim for delay against the company for want of opportunity to forward them; or they may, at the discretion of the company, be suffered to remain on the Company’s premises, or be placed in shed or warehouse (if there be such convenience for receiving same) pending communication with consignees, at the risk of the owners as to damage thereto from any cause whatsoever. But the delivery of the goods by the company will be considered complete, and all responsibility of said company shall cease, when such other carriers shall have received notice that said company is prepared to deliver to them the said goods for further conveyance; and it is expressly declared and agreed that the said Grand Trunk Railway Company shall not be responsible for any loss, mis-delivery, damage or detention that may happen to goods so sent by them, if such loss, mis-delivery, damage Or detention occur after the said goods arrive at said stations or places on their line nearest to the points or places which they are consigned to, or beyond their said limits.
    “ 11. That all property contracted for at a through rate, or otherwise, to or from places beyond the line of the Grand Trunk Railway, if shipped by water, shall, while not on the company’s railway, or in their sheds or warehouses, be entirely at their owner’s risk. In case of loss or damage to any goods for which this } company or connecting lines may be liable, it is agreed that the company or line so liable shall have the benefit of any insurance effected by, or for account of the owner of said goods, and the company sodiable shall be subrogated in such rights before any demand shall be made on them.
    “ 12. That no claim for damage to, loss of or detention of any goods for which this company is accountable, shall be allowed unless notice in writing, and particulars of the claim for said loss, damage or detention are given to station freight agent at or nearest to the place of delivery, within thirty-six hours after the-goods, in respect to which said claim is made, are delivered.
    “ 13. Storage will be charged on all freight remaining in the company’s sheds or warehouses over twenty-four hours after its. arrival.”
    * * * * ® * * *■ *■ *
    “15. That the company shall not in any case, or under any circumstances, be liable for loss of market, nor will they be liable-for claims arising from delay or detention of any train in the course of its journey, or at any of the stations on the way or in starting; and the company do not undertake to load or send goods upon, or by any particular train, if there be an insufficient number of cars at any station, or that the cars cannot be conveniently used for the purpose, or if from any cause cars loaded at. a- station are unable to be sent on by trains passing or starting from such station.”
    These shipping bills were signed by or in the name of the person who delivered the potatoes to the defendant for Shanley & Co.', and the defendant’s station agents gave receipts to such persons ; none of the receipts were produced in evidence, nor were-their contents proved. Further facts appear in the opinion.

      E. C. Sprague, for app’lt; Martin W. Cooke, for resp’ts.

       Affirming 33 N. Y. State Rep., 15.

   Bradley, J.

The place to which the potatoes were consigned was beyond the line of the defendant’s railway; and unless it had contracted to transport them further than the western terminus of its road the duty of the defendant required it only to diligently convey the potatoes to that point and there deliver them to the connecting carrier. Rawson v. Holland, 59 N. Y, 611.

But the conclusion of the referee was that the defendant undertook to deliver the potatoes at East St. Louis. If that proposition is supported the defendant was responsible for the consequences of any default or want of reasonable diligence in that respect on any part of the route unless reliéved by some limitation of liability in the contract of affreightment. Root v. Great Western R. R. Co., 45 N. Y., 524: Condict v. Grand Trunk R. Co., 54 id., 500; 4 Lans., 106.

The communications had between Shanley & Co., the plaintiffs’ assignors, and the defendant’s freight agent on the subject had relation to through rates for transportation of the potatoes for Shanley & Co. from the places where they were afterwards delivered to and received by the defendant to East St. Louis. The rates for such purpose were given and accepted. The defendant’s station agents at the places of shipment were by the direction of the freight agent advised of the rates. And the potatoes were delivered, and in carload lots shipped consigned to such place of destination. They belonged to Shanley & Co., of which the station agents-were also informed at the time of the delivery for shipment The defendant’s railway then had the means of connection at Fort Gratiot and Detroit with trunk lines of railroad running westerly to Chicago and St. Louis. Although the question whether what had occurred between Shanley & Co. and the ^ defendant’s agent constituted an agreement for through transportation was not free from, doubt, the finding was justified that it was such that the unqualified delivery and acceptance of the potatoes may have been treated as in pursuance of a contract to transport them to the place of destination. And in view of the facts and circumstances furnished by the evidence the conclusion of the referee was warranted that in such event there was an undertaking of the defendant to transport the potatoes to that place unless the contract so represented was modified by some further arrangement. Quimby v. Vanderbilt, 17 N. Y., 306; Toledo, etc., R. Co. v. Merriman, 52 Ill., 123 ; 4 Am., 590. Upon that subject our attention is called to the shipping bills executed by the persons who performed the act of delivering the property and to the receipts or bills of lading given to them by the defendant’s station agents. As a general rule the bill of lading given by a carrier to and accepted by the shipper of goods contains the •contract for carriage, and in tire absence of fraud, imposition or mistake the parties are concluded -by its terms as there expressed. Long v. N. Y. C. R. R. Co., 50 N. Y., 76; Kirldand v. Dinsmore, 62 id., 171; Hill v. Syracuse, etc., R. R. Co., 73 id., 351.

In this instance, the receipts or bills of lading of all the potatoes which reached the place of destination were there delivered up to the agent of the railroad company from whose custody the property was taken by the consignees. They were not produced at the trial nor were their contents proved. The shipping bills or notes purport to have been requests of the persons subscribing them that the defendant receive the property addressed to the consignees, “to be sent by the said company subject to the terms and conditions stated above, and on the other side, and which are agreed to by this shipping note delivered to the company as the basis upon which their receipt is to be given for said property.” Shanley & Go. had no knowledge of the making of the shipping bills, nor did they authorize the execution of them unless it came within the power incident to the direction given to deliver the property for shipment. It seems that Shanley & Co. purchased the potatoes and directed their delivery at the defendant’s stations by the persons who delivered or caused them to be taken there for such purpose.

Ordinarily, a person authorized to deliver and delivering tlie property of another to a common carrier for shipment may by the latter be treated as having authority to stipulate for and accept the terms of affreightment, and as against the carrier the owner is bound by them. Nelson v. Hudson River R. R. Co., 48 N. Y., 498; Shelton v. Merchants' Dispatch T. Co., 59 id., 258. The limitation of the common law responsibility of the defendant depended upon a special contract to that effect. And the burden of proving such contract was with the defendant. To do this the shipping bills taken and retained by it were produced. On the back of each of these were twenty-one numbered provisions in fine print. Of these bills it may be assumed that Shanley & Co. had no personal knowledge until they were produced at the trial. They were upon printed blanks kept for the purpose by the defendant, and the referee found that they were made “ in conformity with the general requirement or custom of the defendant on the receipt of goods for transportationand that Shanley" & Co. “then knew it to be the universal custom of railroad companies, so far as their experience went, to require shipping bills to be executed by the shipper containing the terms and conditions of shipment upon the delivery of potatoes or similar goods to such companies for transportation.”

It appears by those bills that the giving of receipts by the defendant’s agent was then contemplated. And the referee found that the defendant’s receipts or bills of lading containing some terms and conditions for the transportation of the potatoes were so given, but that no evidence was offered to prove what those terms and conditions were. The contents of those papers constituted in part at least the contract, and for the complete proof of it they would seem to have been essential. It evidently was for that reason that defendant’s counsel requested the referee to find, whicli he did, that the contracts executed and delivered by the defendant at the time of the shipment of the potatoes have not been proved and thereupon insisted that without proving them the plaintiffs were not entitled to recover. There is no legal presumption to the prejudice of the plaintiffs arising out of the fact that, receipts or bills of lading were given so far as relates to the contract. Those papers had, however, been delivered up at the place and time of the receipt of the property, and it may be assumed that they were accessible to the defendant. The question arises as to the effect of the terms and conditions of the shipping bills upon the rights of the plaintiffs and to what extent they operate to relieve the defendant from its common law duty; and this may depend somewhat upon the authority which the defendant had the right to treat as possessed by the persons signing those bills at the time they were made. Inasmuch as no conditions were mentioned in connection with the information given by the freight agent of the through rates for which the defendant would transport the property, it may be that Shanley & Co. supposed that the common law duty would be assumed by the defendant as such carrier; and that would have been the situation if no special terms had been provided for when the property was delivered to the defendant. And although Shanley & Co. had not undertaken to furnish the property for shipment, they had the right to assume, unless advised to the contrary, that when delivered for that purpose it was received pursuant to the arrangement before then made so far as related to the rates and through transportation. And consistently only with such previous understanding or agreement the defendant was permitted to treat it as within the authority of the persons who delivered the potatoes to make or accept stipulations or conditions for the reception and carriage of the property by it, and beyond that the owners were not necessarily bound by anything contained in the shipping bills so far as it was dependent merely upon the presumption of authority of the persons executing them. Treating, as we do upon the facts found, the defendant’s contract as one for transportation of the property to the place of destination, the provisions and conditions upon the shipping bills, so far as they may be otherwise construed, are not applicable to the shipments in question. Riley v. N. Y., L. E. & W. R. R. Co., 34 Hun, 97; Babcock v. L. S. & M. S. R. Co., 49 N. Y., 491; Condict v. G. T. R. Co., 54 id., 500. The conclusion was permitted that not only did Shanley & Co. have no knowledge of the shipping bills, but that the receipts or bills of lading did not come to them until the potatoes were shipped and had gone forward. They were, therefore, not necessarily charged with any of the terms and conditions (whatever they were) of the bills of lading other than such as the defendant was at liberty to treat as within the authority of the persons receiving them to accept in behalf of the owners of the property. Coffin v. New York Cent. R. R. Co., 64 Barb., 379 ; 56 N Y., 632 ; Bostwick v. Baltimore & Ohio R. R. Co., 45 N. Y., 712; Germania Fire Ins Co. v. M. & C. R. R. Co., 72 id., 90; Guillaume v. General T. Co., 100 id., 491; Swift v. Pacific, etc., Co., 106 id., 206; 8 N. Y. State Rep., 602 ; Park v. Preston, 108 N. Y., 434; 13 N. Y. State Rep., 809. And to that extent and that only the terms and conditions of the shipping bills so far as reasonable and applicable to through transportation of the property by the defendant must for that purpose be deemed within the contract. But limitation of the common law liability of the carrier is dependent upon language in the contract fairly requiring such construction without the aid of implication. The provisions to the effect that the defendant would not be responsible for delay in the transit of the property did not have the effect to relieve it from the consequences of delay occasioned by its negligence, as exemption from liability for that cause was not expressed in the contract. Magnin v. Dinsmore, 56 N. Y., 168; Mynard v. Syracuse, etc., R. R. Co., 71 id., 180 ; Nicholas v. N. Y. C. & H. R. R. R. Co., 89 id., 370.

There was evidence upon the subject, and by it was supported the finding of the referee that the loss suffered and the damages sustained by the plaintiffs’ assignors were caused by the defendant’s negligence in transporting the potatoes. Amongst the terms and conditions on the back of the shipping bills was one numbered 12, which provided “ that no claim for damages to, loss of, or detention of any goods for which this company is accountable shall be allowed, unless noticd in writing and particulars of the claim for said loss, damage or detention are given to station freight agent at, or nearest to, the place of delivery within thirty-six hours after the goods in respect to which said claim is made are delivered.” No such notice was given. The referee refused to give effect to it upon the request of the defendant’s counsel, and exception was taken. The view of the referee was that this provision was not applicable to shipments beyond the terminus of the defendant’s railway. The place of delivery was Bast St. Louis. And the same reason for the requirement of the notice when the place of delivery by the defendant is beyond its own line of road exists for it as when such place is upon its railway. The purpose of the notice evidently was to enable the carrier to investigate the nature, cause and extent of the injury or damages claimed, with a view to the means of the protection which such opportunity may afford. It is the accountability of the defendant for damages that renders the notice essential, and by the terms of the clause in question no other condition is required. It is true that other clauses are to the effect that the defendant should not be responsible beyond its own railway for goods passing over it and from it on to other roads, but it is contemplated that its. cars containing goods might go forward on connecting railroads to the place of destination. It is not seen how that fact can qualify or limit the purpose of the notice. The delivery in view is to the consignee. This can be done only at the ¡place to which the goods are consigned. Before delivery there, he may not be supposed to have either the opportunity or means of giving the notice.

It is legitimate for a common carrier by contract with the shipper to provide for a reasonable time within which notice of claim for loss or damage shall be given as a condition of liability, and the manner of giving it. Express Co. v. Caldwell, 21 Wall, 264; Southern Express Co. v. Hunnicutt, 54 Miss., 566; 28 Am. Rep., 385; Lewi's v. Great Western R. Co., 5 Hurl. & Norm., 867. In those cases the notices provided for were held to be reasonable. And that question is an open one for consideration. • Westcott v. Fargo, 61 N. Y., 542, 551; Adams Express Co. v. Reagan, 29 Iñd., 21; 92 Am. Dec., 332. In this present case each car contained 400 bushels and upwards of potatoes. The time in which the condition required notice to be given might not include more than twelve business hours to ascertain the requisite particulars of the'claim for the purpose of the notice. It is easy to see that the specified time of thirty-six hours would be inadequate to the necessity that might exist in a case like the one under consideration. The conclusion was permitted that, in view of the character and extent of the property, and the nature of the claim for damages which might and did arise, the time specified within which to give notice, with particulars, was quite unreasonable; and, therefore, and for that reason, the condition in that respect was inapplicable to the shipments in question; and the failure to give such notice was no bar to the remedy. This view renders it unnecessary in the consideration of the effect of such condition -to refer further to the circumstances under which the shipping bills were made in view of the fact that it does not appear that the condition was in the bill of lading. No other question seems to require the expression of consideration.

The judgment should be affirmed.

All concur, Follett, Ch. J., in result


text:
    Henri M. Braem et al., App’lts, v. The Merchants National Bank of Syracuse, Resp’t.

      (Court of Appeals, Second Division,

      Filed October 6, 1891.)

    1. Tort—Judgment entered on offer of insolvent corporation—1 R. S., 603, § 4
    Plaintiffs having recovered a judgment against the Syracuse Iron'Works, the latter allowed defendant to enter judgment on an action begun on the day of its entry, so that the defendant’s execution was received by the sheriff a day before plaintiffs’. The sheriff having levied on a third and prior execution, satisfied it, and applying the balance of the proceeds to defendant’s execution, returned that of plaintiffs nulla Iona. Whereupon they brought this action for damages, sustained by defendant’s wrongful and unlawful act in collusively obtaining such offer to allow judgment, in violation of 1 R. S., 603, § 4. Held, that while defendant may, as to the plaintiffs, have been treated as trustee ex maleficio of the fund for the purposes of equitable relief, there was no invasion of any legal rights of the plaintiffs to support the action in the form it was brought, or for the cause alleged.
    2. Same.
    It was the act of the company in making the offer of judgment, and that alone, which violated the statute forbidding a corporation from making any transfer in contemplation of insolvency, and made the judgment a fraud; and upon proper application such judgment would have been declared void.
    Appeal from judgment entered on order of the general term of the supreme court in the fourth judicial department, affirming judgment entered upon nonsuit.
    On October 7, 1884, the plaintiffs recovered, in the city court of New York, against the Syracuse Iron Works, a corporation having its place of business at the city of Syracuse, a judgment for $1,798.38, which was docketed in Onondaga county and execution issued upon it delivered to the sheriff of that county the day following. On October 7, 1884, Mary E. Gere recovered against the Syracuse Iron Works a judgment for upwards of $12,000, execution upon which was delivered to such sheriff at 2.10 P.-M. of that day. Those two judgments were recovered in due course of proceedings in actions. On the same 7th day of October, The Merchants National Bank of Syracuse, the defendant, obtained judgment against the Iron Works for upwards of $15,000, and execution upon it was delivered to the sheriff at 4.30 P. M., and he on that day levied the two last mentioned executions upon the personal property of the Iron Works. On the 15th day of October, 1884, he sold the property, and after satisfying the execution issued upon the Gere judgment he applied the residue of the proceeds of the sale, amounting to $13,671.86, upon the bank execution; and on the 27th of that month the sheriff returned the plaintiffs’ execution nulla lona. The defendant’s judgment was taken upon the acceptance of an offer to allow it in an action commenced on the day of its entry. This action was brought to recover damages alleged to have"' been sustained by the plaintiffs by the unlawful and wrongful acts of the defendant. The trial court directed a nonsuit.
    Wm. C. Holbrook, for app'lts; Wm. G. Tracy, for resp’t.

       Affirming 25 N. Y. State Rep., 281.

   Bradley, J.

The relief sought by this action at law, as appears by the complaint, was founded upon the charge that the defendant, .intending to injure the plaintiffs and to prevent their having satisfaction of their judgment, wrongfully, collusively and fraudulently commenced its action, and by collusion with the officers or agents of the Syracuse Iron Works obtained its offer to allow it to take judgment therein, accepted it, and caused judgment to be entered and execution to be issued and levied upon the property of the Iron Works; and with'the like intent afterwards wrongfully caused the property to be sold by virtue of such execution issued upon the judgment, which having been- so obtained in fraud of the statute was void, by reason whereof the lien of the plaintiffs upon the properly was defeated, lost and destroyed. Ancl for the support of the action the plaintiffs relied upon the statute which provides that: “Whenever any incorporated company shall have refused payment of any of its notes or other evidences of debt, * * * it shall not be lawful for such company, or any of its officers, to assign or transfer any of the property or dioses in action of such company, directly or indirectly, for the payment of debt; and it shall not be lawful to make any transfer or assignment in contemplation of the insolvency of such company to any person, or persons, whatever, and every such transfer and assignment to such officer, stockholder or other person, or in trust for them or their benefit, shall be utterly void.” 1 R. S., 603, § 4. The purpose of the statute was to deny to insolvent associations the right to give preference to any of its creditors, or in contemplation of insolvency to transfer its property. When the defendant proceeded to take judgment against the Iron Works, the commercial paper of that company had been protested and the company was insolvent And it may be assumed that the offer of judgment to the bank was made to give it an unlawful preference; and, so far as it could be, it was accomplished by the judgment entered upon the acceptance of the offer and the issuing of execution to the sheriff, and the preference sought by the Iron Works to give the defendant was in violation of the statute Kingsley v. First National Bank of Bath, 31 Hun, 329; Throop v. Hatch L. Co., 125 N. Y., 530; 35 N. Y. .State Rep., 816.

The only question essentially for consideration on this review is whether the plaintiffs were entitled to relief in this action at law; and for that purpose the cause of action as alleged in the complaint can not here be modified. They had a judgment properly recovered against the company. It was docketed in Onondaga county and execution upon it issued to the sheriff the day following that on which the defendant’s judgment was docketed and execution upon it issued to the sheriff ; and on that day there was also an execution, the first that came to his hands, upon Mary E. Here’s judgment against the Iron Works, levied upon the property. The validity of this judgment is not questioned. At the time of the commission by the Iron Works company of the unlawful act complained of. the plaintiffs had no lien upon the property. When their execution came to the sheriff, the property was in his custody, and unless otherwise directed he would necessarily apply the proceeds of its sale upon the executions in the order they were received, by him. Code, § 1406 ; Peelc v. Tiffany, 2 N. Y., 451. This sale was lawfully made by the sheriff on the 15th of October, and in performance of his apparent duty he applied the proceeds first to the satisfaction of the Gere execution and the residue upon that of the defendant in satisfaction of it pro tanto, and twelve days later returned the plaintiffs’ execution wholly unsatisfied. The plaintiffs’ remedy founded upon the alleged invalidity of the defendant’s judgment was to seek to obtain the payment of theirs from the proceeds of the sale in excess of the amount requisite to satisfy the Gere execution. In that view it is insisted that, subject only to that execution, they by their execution acquired a lien upon the property; and that the apparent situation represented by the priority of the defendant’s execution was on its part wrongful, and enabled it unlawfully to take the proceeds of the sale to which the plaintiffs were entitled.

It may be assumed that the defendant’s execution may upon a proper application to the court have been set aside, or that its direction may have been obtained to apply sufficient of such proceeds in excess of the amount of the Gere judgment upon the plaintiffs’ execution to satisfy it, or that in equity they may have had like relief. But this is in the nature of an action on the case; and its purpose was to recover damages which the plaintiffs claim to have suffered by the alleged tortious and wrongful act of the defendant in taking its judgment and issuing execution upon it, thus apparently defeating the lien of their execution and the benefits which they otherwise would have derived from it. The cause of action alleged may have had its support in this proposition if the defendant’s execution had been without any judgment for its support. Then it may have come within the doctrine of Quinby v. Strauss, 90 N. Y, 664. This, however, was not the situation. The defendant’s judgment was taken according to the forms of law, and was founded upon a valid debt due it from the judgment debtor. It was the act of the company in making the offer of judgment and that alone which violated the statute and made the judgment a fraud upon the law intended to give equality of rights to creditors of insolvent corporations. Varnum v. Hart, 119 N. Y., 101; 28 N. Y. State Rep., 262. And upon proper application of a creditor or of some representative of its creditors the judgment would, for the purposes of relief from its' effect, be judicially treated and declared void. As before remarked, when the inhibited act of the company gave the defendant the opportunity to take the judgment, and when the execution was placed in the sheriff’s hands, the plaintiffs had no lien upon the property, and therefore no right of theirs was then in the legal sense invaded. The plaintiffs’ cause of complaint arose when their execution was issued and that of the defendant apparently had precedence by reason of priority of time of its reception by the sheriff. After the plaintiffs’ execution was issued the defendant did nothing to prejudice the rights of the plaintiffs other than to receive the money applied upon its execution, and this it received upon a claim of right arising out of the execution of its judgment. While the defendant may as to the plaintiffs have been treated as trustee ex maleficio of the fund for the purposes of equitable relief, it is not seen that there was any invasion by the defendant of any legal rights of the plaintiffs in the property of the Iron Works to support the action in the form it was brought or for the cause alleged. Moody v. Burton, 27 Me., 427; 46 Am. Dec., 612; Lamb v. Stone, 11 Pick., 527; Moran v. Dawes, Hop. Ch., 365.

A different question would have been presented if an existing lien of the plaintiffs had been impaired or divested by the act of the defendant. Such was the situation, and that was an essential fact in Yates v. Joyce, 11 Johns., 136, and Van Pelt v. McGraw, 4 N. Y, 110. And in Swan v. Saddlemire, 8 Wend., 676; Kerr v. Mount, 28 N. Y., 659, also cited by the plaintiffs’ counsel, the owners of property taken on void process had their remedy at law. In the present case the property was duly in the custody of the sheriff at 'the time the plaintiffs’ execution was received by him ; and the property was lawfully sold by the sheriff. The only question then to arise had relation to the proceeds of the sale, and did not concern the property itself, and they to the extent of the plaintiffs’ claim after payment of the Gere judgment may properly have been -made the subject of contest between the plaintiffs and defendant. Nothing back of the sale then had any practical significance except in its bearing upon the matter of the disposition of the fund. And while remedies at law, either affirmative or defensive, may be supported in behalf of a judgment creditor having a lien upon, or a purchaser on • execution sale of tangible personal property transferred by the judgment debtor in fraud of his creditors before the levy, the same rule is not applicable to the proceeds received by the fraudulent vendee on sale by him of the property. They for the pursuit of the creditor are the subject of equitable jurisdiction only. Lawrence v. Bank of the Republic, 35 N. Y., 320. The sale by the sheriff was valid, and title to the property passed to the purchaser relieved from the. lien of the execu-. tians. Then the proceeds remaining after satisfying the Gere judgment alone became the subject for controversy. They went to the defendant by means of an apparent lien upon the property through the operation and execution of the judgment given to it by the Iron Works Company in fraud of the. statute and thus of the other creditors' of the latter. On that assumption when the identity of the property of the company was lost to the plaintiffs, they may for the purposes of equitable remedy and relief have treated the defendant as trustee of the fund. And the question whether an action for money had and received may or may not have been sustained by the plaintiffs does -not here arise, and therefore is not considered. The court below did not treat the case in that aspect, and was not required to do so upon the issues presented by the pleadings. It was there held that the alleged cause of action in tort was not sustained ; and in that there was no error. i

Without considering any' other question, these views lead to the conclusion that the judgment should be affirmed.

All concur, except Vann, J., not sitting.


text:
    The National Bank of West Troy, App’lt, v. Margaret Levy, Ex’rx, et al., Resp’ts.

    (Court of Appeals, Second Division,

      Filed October 6,1891.)

    1. Mortgage—Cloud on title—Action, to cancel.
    An administrator may bring an action to cancel a mortgage apparently given by his intestate, as void, even though the signatures to the mortgage were forged, and it was never executed or delivered by such intestate, .where it has been regularly recorded and appears as a cloud upon the title, and on his refusal to do so such action may be brought by the judgment creditor.
    (3. Same—Conditions precedent.
    The docketing of a judgment in the county in which the real estate is situated, and the return of execution unsatisfied, are not essential to support an action of this character. Such an action is not in the nature of a creditor’s bill.
    Appeal from order of the general term of the supreme court, in the third judicial department, reversing judgment entered on report of a referee and granting a new trial.

      R. A. Parmenter, for app’lt; N. C. Moak, for resp’ts.

       Reversing 17 N. Y. State Rep., 529.

   Bradley, J.

This action was commenced December 13, 1877, and its purpose was to cancel as fraudulent and void and dis- • charge of record a mortgage purporting to have been made by Michael Byan to Barnard Levy, of date May 11, 1872, upon certain lands in the county of Albany to secure the payment of $5,000, and recorded in the clerk’s office of that county May 23, 1877. Byan died in September, 1875, indebted to the plaintiff in a sum on account of which the latter, on December 3, 1877, recovered a judgment against Catharine Byan, as administratrix, etc., for upwards of $3,000. Before commencing this action the plaintiff requested such administratrix, and she refused, to bring an action for relief against the alleged mortgage. The defendants answered, putting in issue the material allegations of the complaint charging the invalidity of the mortgage. The original defendant, Levy, died before the trial, and the action was revived against Margaret Levy, as executrix, etc. The referee found that the alleged mortgage was never in fact executed or delivered by Michael Byan to Levy; and that there was no property or assets of the estate of Byan, deceased, other than the real estate described in that instrument, and of that he died seized.

And as conclusion of law, the referee determined that the alleged mortgage was void and that the plaintiff was entitled to judgment that it be cancelled and discharged of record, which was entered accordingly.

The plaintiff by its judgment had no lien upon the land to support the action, and its maintenance was dependent upon the right of Catharine Byan as such administratrix to prosecute it. The question, therefore, is whether she had such right When the common law remedy of a creditor to charge the fraudulent vendee of his deceased debtor as an executor de son tort for the purposes of relief was by statute taken away and the right of action in such cases given to the personal representatives of the decedent, it was through them and their right of action that the creditor at large must necessarily seek relief against-the disposition in his lifetime by the deceased debtor of his property in fraud of his creditors. 2 R. S., 449, § 17 ; Babcock v. Booth, 2 Hill, 181; Bate v. Graham, 11 N. Y., 237. Those cases related to personal property, and such was the application made of the statute.

The provisions of chapter 314, Laws 1858, are broader in their sbope and meaning, and they are in effect that any executor or administrator may for the benefit of creditors interested in the estate or property disaffirm, treat as void and resist all acts done, transfers and agreements made in fraud of the rights of creditors; and that every person who shall in fraud of the rights of creditors have received, taken or in any manner interfered with the estate, property or effects of any deceased person shall be liable in the proper action to the executors or administrators for the same or the value of any property or effects so received or taken. While the administrator does not take the real estate of his intestate, and as to that property he is not a trustee, it is to be appropriated for the payment of the debts of the decedent in default of personal estate for the purpose. At the time this action was commenced it was in the power of the administratrix, etc., of Eyan to take proceedings for the sale of the real estate for the payment of the debts of her intestate, with which it was then chargeable. Code, § 2750. In view of the statute of 1858 it was said by Judge Earl in Lichtenberg v. Herdtfelder, 103 N. Y., 302; 3 N. Y. State Rep., 91, that where land of the decedent has in his lifetime been conveyed by him in fraud of his creditors it is the duty of the executors to pursue and reclaim it for the benefit of such creditors, as the want of personal estate to pay them renders the realty assets for that purpose. And the same was held in Barton v. Hosner, 24 Hun, 467.

The purpose of the statute in its effect was beneficially so enlarged, as without it the remedy of the creditors would depend upon a sale of the land subject to the embarrassment which the apparent title in another might furnish, and as the consequence its marketable value in that condition would or might be greatly reduced and .the proceeds realizable from the sale much less than otherwise would be produced by it. The same rule applies with equal reason to an apparent lien by mortgage upon the lands of the decedent created for like purpose. It is, however, urged that as the instrument in question was not executed by the intestate, it was not a mortgage upon the land described in it and therefore no action by the administratrix would lie to cancel it. It may be observed that the person named as mortgagee took it to the county clerk for record and caused it to be-recorded in May, 1877, and by his answer he alleged that the intestate Eyan exeouted and delivered to him the mortgage; and the administratrix alleged upon information and belief that such mortgage was genuine and valid. The defendants were persistent in that defense on the trial, and that issue was there tried, and exception was taken to the conclusion of the referee that the mortgage was not executed by Ryan. It stood as an asserted lien upon the land with the claim of the alleged mortgagee and his personal representative that it was genuine and valid as such, aided so far as it could be by the adoption and approval of the personal representative of the alleged mortgagor. If, therefore, the instrument is a cloud upon the title to the land, the person named as mortgagee has by means of it “interfered with the estate” of the intestate in fraud of the rights of creditors, and it is entitled to the same treatment for the purposes of the remedy and relief as if it had in fact been made and taken with such fraudulent design by "the parties to it. While a mortgagee as such has no title to the land he is deemed a purchaser sub modo and his mortgage in a like qualified sense is a conveyance. Ledyard v. Butler, 9 Paige, 132; Packer v. Rochester, etc., R. R. Co., 17 N. Y, 287. And when the equity of redemption is foreclosed, the purchaser takes ■the estate the mortgagor had at the time he gave the mortgage. Rector, etc., v. Mack, 93 N. Y., 488. Until then the title is held subject to the mortgage and to the extent of its amount the estate of the mortgagor in the land is practically diminished. This is what Levy sought to accomplish upon the land in question, and if his efforts were effectual the estate attending the legal title would be reduced in value $5,000, and that much, by his interference with it, taken from the assets of the intestate.

The purpose of this action is to reclaim the premises from that apparent charge placed upon them by such interference, and to have such act judicially treated as void for the benefit of the creditors. And although the mortgage appears by the finding of the referee, supported by evidence, to have been forged, the purport of the record of it is that it was duly executed and acknowledged, and without the proof of extrinsic facts to the contrary it would be deemed valid and effectual as a mortgage upon the premises described in it. The presumption of validity thus arising from the record, and requiring extraneous evidence to overcome it, and to show that it was falsely there represented, presents a case for the exercise of equitable jurisdiction for its cancellation as a cloud upon the title to land. Remington Paper Co. v. O'Dougherty, 81 N. Y., 474; Sullivan v. Finnegan, 101 Mass., 447. These views lead to the conclusion that the case presented was properly one within the statute for the maintenance of an action by the personal representative of Ryan, deceased, to relieve the premises from the cloud which the alleged mortgage by the record purports to have created. And that being so, the plaintiff as a creditor, on the refusal of the administrator to bring the action, was at liberty, as it did, to do so, making her a party defendant, with a view to the same equitable relief which may have been awarded if she had been the party plaintiff. Bate v. Graham, 11 N. Y., 237; Greaves v. Gouge, 69 id., 154; Crouse v. Frothingham, 97 id., 105. The facts essential for that purpose appear hy the record before us. to have been alleged in the complaint and proved on the trial.

The maini ground upon which the conclusion in the general term was reached, as appears by the views expressed in the leading opinion there delivered, was that the docketing of the plaintiff's judgment in Albany county, and the return unsatisfied of execution upon it, were essential .to support the action. Since that decision it has been held that such requirement is not-applicable to a case of this character, as the action is not in the nature of a creditor’s bill. Harvey v. McDonnell, 113 N. Y., 526; 23 N. Y. State Rep., 501; National Tradesmen's Bank v. Wetmore, 124 N. Y., 241; 35 N. Y. State Rep., 316; No other question seems to require consideration.

The order should be reversed; and judgment entered upon the-report of the referee affirmed.

All concur, except Follett, Ch. J., and Parker, J., not voting.


author: O’Brien, J.

text:
    In the Matter of the Application of the Split Rock Cable Road Co. to acquire real estate of Charles Hughes et al.

      (Court of Appeals,

      Filed October 6, 1891.)

    1. Eminent domain.
    A possible limited use by a few, and not then as a right, out by way of permission or favor, is not sufficient to authorize the taking of private-property against the will of the owner.
    2. Same—Cannot be exercised by road operated mainly eor private
    purposes. .
    Petitioner was organized under the tramway act of 1888, and operates-its road from a point near the works of a corporation in which petitioner’» incorporators were interested, to lands of said corporation at another place. It has thus far been used solely for transporting stone for said corporation, although it is stated that the intention is to carry freight for any person offering the same to the extent of its surplus capacity after supplying such corporation. Reid, that in view of the statute under which-it was incorporated, the objects of its incorporation and the evidence in regard to the manner in which it has been and is to be "operated, and the purposes of its corporate existence, the use to which it is to devote the lands sought to be taken is not public, but private, and therefore it had. no right to take the same.
    Appeal from order of the supreme court, general term, fourth department, reversing order of special term appointing commissioners to ascertain and appraise the compensation to be paid to-the landowners for lands to be taken by the company.

      William G. Tracy, for app’lt; Thomas Hogan, for resp’t.

       Affirming 34 N. Y. State Rep., 169.

   O’Brien, J.

The Split Bock Cable Road Company, a corporation organized under chap. 462 of the Laws of 1888, entitled “An act to authorize the formation of elevated -tramway corporations, and to regulate the same,’’ applied by petition to the supreme-court for authority to. take for its corporate use certain lands, of which the respondents are the owners. The right to take these lands was contested by the owners on several grounds, among them that the use for which they were required by the corporation was not public. The special term granted the application .and directed the appointment of commissioners to appraise the value of the property, and this order has been reversed by the general term. There are some questions of minor importance, .such as the- omission of the petitioner to file a map, and the present necessity for acquiring the lands for any purpose, that, in our view, need not be considered. The prominent question is whether the application is for the taking of private property 'for a public use in fact or for a purpose merely private. The provisions of the statute under which the petitioner is incorporated,_ so far as they are material to the question, are as follows:

“Section 1. Any number of persons not Jess than thirteen may form a company for the purpose of constructing, maintaining and operating an elevated tramway, constructed of poles, piers, wires, rods, ropes, bars or chains, for the transportation of freight in suspended buckets, cars or other receptacles, for hire; and for that purpose may make and sign articles of association in which shall be stated the name of the company, the number-of years the same is to continue, the places from and to which the said tramway is to be constructed, maintained and operated, and the length •of said tramway, as near as may be.”

The particular powers which such corporations may possess and exercise are enumerated and specified in the following provisions: “ Section 6. Every corporation formed under this act shall have power and authority: 1. To cause such examination and surveys for its proposed tramway to be made as may be necessary to the selection of the most advantageous route, and for such purpose by its officers and servants to enter upon the lands or waters of any person, but subject to responsibility for all damages which .shall be done thereto! 2. To lay out its tramway and to construct the same as hereby provided.

“ Section 7. In case any company formed under this act is unable to agree for the'purchase, use or lease of any real estate required for the purposes of its incorporation, it shall have the right to acquire title in fee to the same in' the manner and by the proceedings provided by law for acquiring title to lands for railroad use, by railroad corporations, under the provisions of chap. 140 of the Laws of 1850, and the several acts amending the same, supplemental thereto, so far as the same are applicable.

“ Section 9. Every corporation formed under this act shall have power and authority to erect and maintain all necessary and convenient buildings, stations, fixtures and machinery for the accommodation and transaction of its business.”

The articles of association of the petitioner, which are acknowledged June 13, 1888, and filed June 19, 1888, state that the subscribers “ have associated together as an elevated tramway corporation, to continue in existence for the period of fifty years, for the purpose of constructing, maintaining and operating an elevated tramway between Split Eoclc and Onondaga lake, a distance of about four miles, both of which places are in Onondaga county.”

The capital stock of the petitioner was all paid in, and in June, 1889, it completed its tramway from Split Rock northerly to near the Erie canal, a distance of about three and a half miles, and since then it has been in operation. The tramway consists of two elevated cables, held upon supports and parallel to each other, about ten feet apart, on which run buckets by means of a trolley or pulley, one line taking the buckets that have been filled, and the other line taking back the buckets which are empty. The location of the southern terminus of this tramway is upon the land of the petitioner, just north of the lands now desired to be taken, and is in a gorge about ninety feet lower than the Hughes, land.

There is nothing in the statute under which this cozporation was formed nor in the objects of the coz-poration as expressed in the articles of association sufficient to warrant the conclusion that, the business which it is- organized to carry tin is public izi the sense that enables it to take private property under the power of' eminent domain. The special term, however, found as matter of fact that the lands required by the corporation and described in the petition were for a public use, and it remains to inquire whether the general term was right in holding, as it did, that this finding was without evidence to support it. The facts and circumstances from which the nature of the use to which the corporation proposes to apply the property, sought to be condemned, are practically undisputed. The company has filed no map indicating an intention in any way to include the land in question within the boundaries of its property, a fact which, standing alone, would foz’m a very serious obstacle to the success of the application. Matter of the Rochester' El. R. Co., 123 N. Y., 351; 33 N. Y. State Rep., 695. The map of its route originally filed, taken in connection with the evidence, shows that the southern terminus of the tramway is upon the land of the petitioner and near the establishment of theSolvay Process Company, a corporation engaged in a large and growing business consisting, as is to be inferred from the evidence,, in the production of soda ash. This company owns one hundred acres of land upon which az-e stone quarries and this land entirely surrounds the terminus of the tramway as well as the lands in question. The northern terminus of the tramway, as now built, is also on the lands of the Solvay Process Company at the lime kiln of their works, about 500 feet from the Erie canal. The incorporators of the petitioner were practically all stockholders and persons interested in the Solvay Company and it is quite apparent, that the petitioner was organized and is operated as an instrumentality to facilitate the business operations of the Solvay Company. The only business that it has thus far carried on was for that company. As now constz-ucted the limit of its carrying capacity cannot exceed 750 tons per "day. It has thus far been operated pz-actically night and day and has succeeded in carrying for the Solvay Company 350 to 400 tons of stone a day.

There is no public highway leading to the northern terminus of the road by means of which the public can obtain access for its use. That the roád has thus far been entirely for the benefit of the Solvay Company, and that its business is to be entirely subordinate in the future to the plans and interests of the same company is entirely clear. From the evidence of the president of the petitioner and other witnesses in support of the application, the most that is claimed is that the surplus of the capacity of the road, after supplying the wants of the Solvay Company, is to be devoted to public use in carrying, in buckets, freight offered to it by any person, providing such freight is suitable to the buckets and the road. Whether there is to be any surplus capacity, as the Solvay Company continues to expand its business, and, if so, how much, are questions which are left entirely uncertain. From the testimony it appears that the lands are required in order to increase the terminal facilities of the tramway company by building other tramways on the surface to facilitate the carrying of stone to the cable station, by erecting buildings for the storage of freight and for repair shops, and to furnish means of access. The company has other lands that could be used for these purposes, but it is not so convenient. The evidence does not suggest any business that the petitioner is to carry on in the future any more than in the past, beyond the carrying of stone for the Solvay Company, except, possibly, the carrying of coal. In regard to that it is best to describe the project in the language of the president himself, who said: “We intend to-make a contract with some private individual to furnish him with coal, so that he can transport it or sell it to people in that vicinity: to establish a coal yard the same as anywhere; not that the Solvay Process Company or the Cable Company will establish a coal yard; some individual will have to run it, with whom wre will make a contract to carry coal, and we propose to limit the contract to one individual for the present.” Looking at the statute under which the petitioner was incorporated, the objects of its incorporation as described in the certificate and the evidence in regard to the manner in which it has been and is to be operated, and the purposes of its corporate existence, we think it is entirely clear that the use to which the petitioner is to devote the lands of the respondents is not public, but private. The principles governing applications by corporations of this character, to take private property for its corporate purposes, have been very fully discussed and stated in a recent case in this court. Matter of Niagara Falls & Whirlpool R. Co., 108 N. Y., 375; 13 N. Y. State Rep., 690. Under the doctrine of this and other cases, a possible limited use by a few, and not then as a right, but by way of permission or favor, is not sufficient to authorize the taking of private property against the will of the owner. Matter of Deans-ville Cemetery Association, 66 N. Y., 569 ; Matter of Fureka Basin Warehouse & M. Co., 96 id., 42 ; Rochester, Hornellsville & Lack. R. Co. v. Babcock, 110 id., 119 ; 16 N. Y. State Rep., 863 ; Matter N. Y., L. & W. R. Co., 99 N. Y., 12.

The order appealed from is right and should be affirmed, with costs.

All concur, except Finch, J., absent.


author: Peckham, J.

text:
    Dempster C. Austin, Resp’t, v. Charles C. Vrooman et al., App’lts.

      (Court of Appeals,

      Filed October 6, 1891.)

    False imprisonment—Justice not liable for error of judgment—Laws 1885, chap. 183.
    Plaintiff was arrested upon warrant for violation of chap. 183, Laws 1885, and upon arraignment pleaded not guilty and waived examination, and offered to give bail to the grand jury. This was overruled by the justice who_ tried the case with a jury, and plaintiff was found guilty. The conviction was'reversed by the general term, on the ground that the offer of bail should have been accepted, and that the justice erred in deciding to try the ] laintiff. In an action for false imprisonment, Held, that the error of the justice in deciding that he had jurisdiction to proceed was an error of judgment upon a question of law, and that he was not responsible for such error in a civil action.
    Appeal from order of the supreme court, general term, fourth department, reversing judgment of nonsuit, and ordering a new trial.

      J. A. McConnell, for app’lt Vrooman; Watson M. Rogers, for .app’lt Chase; Wm. H. Gilman, for resp’t.

       Reversing 33 N. Y. State Rep., 1133.

   Peckham, J.

The defendant Chase was a justice of the peace in Jefferson county, and the defendant Yrooman, in August, 1887, appeared before him and made a sworn complaint against the above plaintiff, charging that he supplied to a certain butter manufactory diluted milk,' etc. The justice issued a warrant for the arrest of the plaintiff upon such complaint, and he was thereupon arrested and brought before the justice. The offense charged against the plaintiff was a violation of chap. 183 of the Laws of 1885, which was a misdemeanor. The plaintiff, when arraigned before the justice, pleaded not guilty. The district attorney appeared for the people. The record shows that the-plaintiff waived a preliminary examination and offered to give bail for his appearance at the next grand jury of Jefferson county. The justice overruled the offer. The plaintiff then demanded a jury, which was summoned, the case was tried and the plaintiff found guilty and sentenced to pay a fine of $100 and to be imprisoned until it was paid, not to exceed ninety days. He was thereupon taken by a constable to the county, jail and was there in confinement from early in the morning until some time in the afternoon, when his counsel procured his discharge. The case was taken to the court of sessions of Jefferson county, where the conviction was affirmed, but upon appeal to the general term of the supreme court it was reversed and the plaintiff discharged, upon the ground that after the plaintiff had offered to give bail to the grand jury the justice should have accepted it, and that he erred in then deciding to try the plaintiff. The plaintiff commenced this action for false imprisonment and malicious prosecution, and upon the trial he abandoned the latter ground and sought to recover for the false imprisonment.

Upon these facts the trial court nonsuited the plaintiff, and upon appeal the judgment of nonsuit was set aside and a new trial granted by the general term, and from the order granting the now trial the defendants appeal here, giving the usual stipulation for judgment absolute in case the order be affirmed. The plaintiff contends that upon his arraignment he had the option to submit to a trial before the justice or to demand a trial by jury after indictment, and if he chose the latter, it was the duty of the justice to hold him to answer the charge before a court having the authority to inquire by a grand jury in regard to the alleged offense. Having elected, as he says, to give bail, the justice was bound to accept it if sufficient, and he had no longer any jurisdiction over the subject matter or over the plaintiff’s person, and the proceedings of .the justice were thereafter wholly without jurisdiction, and he and all else concerned therein were liable in damages to the plaintiff.

The right of the justice to proceed depends upon the construction given to the statute of 1885, above mentioned. If that statute gave exclusive jurisdiction to a court of special sessions to try alleged offenders against its provisions, then the justice was right in his decision to try the plaintiff, notwithstanding his demand to be held to bail to the next grand jury.

Section 14 of the act provides that “ courts of special sessions shall have jurisdiction of all cases arising under this act, and their jurisdiction is hereby extended so as to enable them to enforce the penalties imposed by any or all sections thereof.” The proper construction to be given this section is not now an open question. In The People v. Harris, 123 N.Y., 70; 33 N.Y. State Rep., 168, we have held that exclusive jurisdiction was not conferred upon courts of special sessions by such language. This decision had not been made when the justice proceeded to try the plaintiff. As the statute did not confer this exclusive jurisdiction upon courts of special sessions the justice was bound by the provisions of § 211 of the Code of Criminal Procedure, which directs the magistrate, when the person accused is brought before him, to inform him of his right to be tried by a jury after indictment, and in case he shall elect to be so tried, the magistrate can only hold him to answer to a court having authority to inquire by the intervention of a grand jury into offenses triable in the county.

We think the plaintiff complied in substance with the provisions of that section when he pleaded not guilty and waived preliminary examination and offered to give bail for his appearance at the next grand jury of Jefferson county. There can be no room for any doubt that the plaintiff did by this language ask to be tried by a jury after indictment. It was the duty, therefore, of the justice to have taken bail and proceeded no further.

In trying the plaintiff and upon his conviction committing him to prison, has the justice rendered himself liable in damages to the plaintiff? He did erroneously decide that he had the right to try the plaintiff, notwithstanding his demand, but has such erroneous decision rendered him as to all future acts a trespasser? The answer depends upon a matter of jurisdiction. It is not a question of jurisdiction to proceed with the trial, notwithstanding the demand, but it is a question of jurisdiction to decide whether he has or has not that right. Manifestly, he does not, as a matter of law, acquire jurisdiction to proceed by deciding that he has it, but being confronted with the question of jurisdiction, has he the power to decide it so far that his erroneous decision that he has it exempts him from liability on the ground that he has only made a judicial emu’, or an error of judgment upon a question of law which he was bound to decide.

In such a case as this it must be remembered that the justice had in the first instance, at all events, jurisdiction of the subject matter, viz.: the inquiry into 'alleged offenses against the provisions of this act and the trial of alleged offenders. He also had jurisdiction of the person of the plaintiff. Full jurisdiction had thus been confided to the justice over subject matter and person at the time when the plaintiff was arraigned before him. In the absence of a proper demand and the giving of sufficient bail, it was the duty of the justice and his jurisdiction continued to try the accused. This would seem to be a case where jurisdiction having thus attached, the decision of the justice to try the plaintiff was only an erroneous exercise of such jurisdiction. It is unlike the case where jurisdiction has never been conferred, and the justice decided to exercise a power that he does not and never did possess.

Here in the course of proceedings.which he was forced to institute, and in the case of one over whose person he has properly acquired jurisdiction, the justice is confronted with the necessity ■of deciding a question depending upon the construction to be given to a statute, and that question must be decided by him one way or the other before he can take another step in those proceedings, which, up to that moment, have been legally and properly pending before him and over wffiich he has had full and complete jurisdiction. It seems plain that his decision upon the question is one in the course of a proper exercise of the jurisdiction first committed to him, and that bis error in deciding that he had jurisdiction to proceed was an error of judgment upon a question of law, and that he is therefore not responsible for such error in a civil action. It is unlike the case where a justice of the peace proceeded to try a civil action for assault and battery. Woodward v. Paine, 15 Johns., 493. The justice never had in such case obtained jurisdiction over the subject matter and he could not obtain it by deciding that he had it. The case falls under the principle of law that where a judge never has had jurisdiction over the subject matter he acts as a trespasser from the beginning in assuming it, and his decision that he has it is no protection to him. I know it was stated in Gordon v. Longest, 16 Peters, 97, in a case where the defendant took the proper steps to remove an action brought against him in the state court to the United States court, and where the judge of the state court persisted, notwithstanding those steps, in trying the cause, that every step subsequently taken by the state court in the exercise of jurisdiction was cor am, non judice. Yet in such a case the question is put whether the state judge would be liable for proceeding with the case in the honest exercise of his judgment. Lange v. Benedict, 73 N. Y., 12, at 36. And in a case where a plea of title to real estate is put in before a justice of the peace, which ousts him of jurisdiction, would the justice be liable in case he erroneously decided that he continued to have jurisdiction? This question is also put in the course of the opinion in the case of Lange v. Benedict, supra, and with, as I think, a leaning on the part of the learned judge toward the position of non-responsibility. The jurisdiction existed in both cases at one period and it was on account of the steps taken in the course of the proceedings in the cases that the court or judge was called upon to say whether his jurisdiction had ceased or not

It seems to me that the erroneous decision of that question did not render the judge liable in either case. Unless the proper steps were taken, the judge had power in each case to proceed and try it; and so, although the application to remove is properly made, it is addressed to the legal discretion of the judge upon the papers presented, and a question of law is presented for him to decide. His erroneous decision, while conferring no jurisdiction upon him, is still such a judicial determination of a matter already properly pending before him, and over which, up to that moment, he had jurisdiction, that he must be protected from a civil action in regard to it.

It has been held, Butler v. Potter, 17 Johns., 145, that where a justice entered judgment for more than five dollars costs, when the statute prohibited judgment for more than that sum for costs, the judgment was voidable but not void. He had jurisdiction to give judgment for some amount, and hence his decision to give it for more than the statute allowed was not void. The case of Prigg v. Adams, 2 Salk., 674, was cited as sustaining the principle. The judgment in that case was declared to be void, as in violation of an act of parliament, because rendered in a case arising in Bristol, where the act provided that in such a case no judgment should be entered in a court of Westminster for less than a certain sum, and this judgment was for less. The defendant, an officer, took the plaintiff on a ca. sa. issued on the judgment, and it was held that the same was a protection to the officer. See, also, Clark v. Holdridge, 58 Barb., 61.

So it has been held that granting an adjournment to the plaintiff in a justice’s court, in a case where by law he was not entitled to it, acted as a discontinuance, and that the case, as between the parties, was out of court, and the justice had no jurisdiction to proceed further. Proudfit v. Henman, 8 Johns., 391. In such case the justice, notwithstanding the adjournment, assumed to retain jurisdiction and rendered judgment and issued execution, and defendant’s property was sold under it. It was held that the justice was not liable as a trespasser. It was said the court had jurisdiction over the parties and over the question of adjournment; and although he had in reality no legal power to grant the adjournment, and the case was thereby discontinued as between the parties, and any judgment thereafter rendered liable to be reversed, yet the justice was not liable because his decision to grant the adjournment, although in a case where he legally had no power, was yet an error of judgment, and he was not liable, be cause he had jurisdiction and was called upon to decide. . Horton v. Auchmoody, 7 Wend., 200.

So in the case Matter of Faulkner, 4 Hill, 598, it was held that in order to give jurisdiction to the officer to whom an application is made for a warrant against a person as an absconding or a concealed debtor, the affidavits of the two witnesses required by 2 E. S., 3, § 5, must state facts, and mere information and belief will not answer.

And yet in Harman v. Brotherson, 1 Denio, 537, the affidavit stated the facts only on information and belief, and. it was held that though insufficient to sustain the order to hold to bail against a motion to set it aside, it protected an officer making the arrest against an action for false imprisonment. The court said it was a case where, upon proper proof, an order to hold to bail might be made. The officer had jurisdiction of the matter and acted judicially in- making the order, and it was clear he could not be made answerable as a trespasser for an error in judgment.

In Stewart v. Hawley, 21 Wend., 552, the case arose upon the statute in regard to the observance of the Sabbath, which prohibited servile laboring or working on that day. The defendant, who was a magistrate, issued his warrant for the arrest of the plaintiff upon a complaint charging that he was on the Sabbath day personally engaged in circulating a memorial to the legislature at its next session, and upon proof made of that fact on the trial the plaintiff was convicted of a violation of the statute. -The plaintiff brought his action of trespass to recover damages, but the court held that yvhen complaint was made the defendant was bound to entertain it and exercise his judgment on it, and whether the facts disclosed showed prima, facie a violation of the statute was a question of law, for the erroneous decision of which the defendant was not liable; that he had jurisdiction to try a person for a violation of the law and he was1 therefore compelled to decide in a case where jurisdiction over the subject matter belonged to him.

Other cases of a somewhat similar import are cited in the learned opinion of Mr. Justice Hardin in the court below.

We are inclined to think that this was not a case for holding the magistrate liable to an action on the part of the plaintiff in the nature of trespass to recover damages for his illegal imprisonment.

In this case there seems to have been no question but that the justice in all that he did acted in entire good faith. The district attorney appeared for the people before the magistrate, and contended that the magistrate had exclusive jurisdiction to try the case under the particular statute. The justice so decided. The court of sessions of Jefferson county, upon appeal, concurred in that construction of the statute; and although the general term of the supreme court came to a different conclusion, in the correctness of which we concur, it is yet manifest that there was at least color for different constructions of the terms of the act. It would be a pretty hard rule which, under such circumstances, should hold a magistrate liable to be cast in damages for an honest mistake in judgment upon a question of law in a proceeding over which he had jurisdiction up to'the moment when he was called upon to decide the question. It seems to us there is no public policy which demands such a measure of liability on the part of inferior magistrates, and we think we are not overruling any case in this or in the old supreme court The rule is clear enough, but in this as in many other cases the difficulty consists in its proper application. We have, as we believe, properly applied it in this case.

We have also looked at thé other questions appearing in the record, the exceptions of the plaintiff taken on the trial, and the rulings of the court thereon, and we think no error was committed calling for a new trial.

The order of the general term granting a new trial must, therefore, be reversed and the judgment of nonsuit affirmed, with costs to the defendants in all courts.

All concur, except Finch, J., absent.