author: RUMSEY, J. BARRET, J.

text:
    New Haven Steamboat Co. v. Providence Washington Ins. Co.
    (Supreme Court, Appellate Division, First Department.
    Nov. 26, 1896.)
    1. Marine insurance—Substitution—Construction of contract.
    A policy on the stumer N. provided that the insurance should cover any other steamer which should take her place “to the same extent as if this policy were originally and specifically written upon the steamer so substituted; * * * notice of such substitution to be-given.”, The C. was substituted for the N., and due notice given. Held, that the policy, by its terms, thereafter attached to the C., and did not reattach to the N. when she resumed her place. Barrett and Ingraham, JJ., dissenting.
    2. Same—Course of dealing—Besubstitution—Notice.
    Where it had been customary under similar policies for defendant-to permit resubstitution of steamers from time to time, on notice of each change, plaintiff had a right to resubstitute the original steamer, but only on notice, as in case of substitution.
    8. Same—Evidence of resubstitution.
    Plaintiff employed the three steamers, N., C., and E. Defendant', insured the N. under a policy which permitted the insurance to attach to any steamer substituted for the N., and to reattach to the N, when she should resume her place. Notice of such substitution and resubstitution was to be given the insurer. Plaintiff notified defendant that-the C. had been substituted for the N., and afterwards wrote that the E. would be withdrawn, and the C.resume her place, when “the policy on the latter boat will then apply.” Held, that this letter was no evidence that the N. had resumed her place, and that her former policy was to reattach to her. Barrett and Ingraham, JJ., dissenting.
    Action by the New Haven Steamboat Company against the Providence Washington Insurance Company on a policy of insurance. The complaint was dismissed, and plaintiff moved for a new trial on exceptions ordered to be heard in the appellate division in the first instance.
    William J. Kelly, for plaintiff; Robert D. Benedict, for defendant.
   RUMSEY, J.

—On the 4th day of January, 1890, the defendant issued to the plaintiff a policy of insurance upon the plaintiff’s steamer C. H. Hortham. The policy, contained a provision for substitution of another steamer, which will be referred to more at length later. On the 24th day of February,, 1890, the plaintiff gave notice to the defendant that the steamer Continental had on that day taken the place of the steamer Hortham. On the 4th day of September,. 1890, the Hortham was injured in a collision, and the defendant, if its policy of insurance was then in force as to the Hortham, became liable to pay .as indemnity for the damages suffered by the collision a certain amount of money, which is not here in dispute. Hotice was given by the plaintiff to the defendant of the loss, hut liability was repudiated by the insurance company, and thereupon, after considerable delay, this action was brought., Upon trial at the circuit a verdict was ordered for the defendant, and the exceptions taken by the plaintiff were ordered to be heard in the first instance in the appellate division, and thereupon the plaintiff makes this motion for a new trial upon the exceptions.

It is claimed on the part of the defendant that when another steamer was substituted for the Uortham on the 24th of February, 1890, and notice of that substitution given, the policy of insurance attached to the steamer thus substituted, and that there should be no resubstitution, or at least none by virtue of which the policy would reattach to the Uortham, until notice of that resubstitution had been given to the defendant. It is claimed, on the contrary, by the plaintiff, that the substitution of another steamer in place of the Uortham only lasted so long as the other steamer should be running upon the line in her place, and when that ceased to be the case the policy again attached to the Uortham without notice of the resuhstitution; or that, if a notice of the resubstitution was necessary, there were facts from which the giving of such notice could be inferred, and therefore the case should have been sent to the jury. It is clear that this dispute is to be decided purely by a construction of the policy in the light of the facts which were made to appear upon the trial. It is conceded that on the 24th of February, 1890, a notice was given by the plaintiff to the insurance company that the Uortham was taken off the line, and that the steamer Continental had taken its place; and it is conceded also that upon the giving of that notice the policy of insurance which before that time had stood upon the Úortham became attached to the steamer Continental. The effect of that substitution is to be decided by an examination of the terms of the policy. Upon that examination it is to be seen that the policy, in" the first place, purports to insure, the plaintiff in the sum of $12,500 on the steamer C. H. Uortham from the 4th day of January, 1890, until the 4th of January, 1891. By a rider attached to the policy it is provided that the insurance shall be upon the steamer C. H. Uortham, her hull,, engines, boilers, etc., “ or whatever steamer may be employed" upon the line in the place of said steamer C. H. Úortham.” If that were all there were of the policy, it would be quite clear, we think, that the contract between the parties provided for a substitution of any other steamer which should be put upon the line in the place of the Uortham, but it did not provide for-any ¡resubstitution, or that the policy should again attach to the Uortham after it had once been diverted from her. The policy contains, however, the further clause: “ Privilege to substitute any other steamer owned or chartered by the assured to run on said line in place of said steamer C. IT. Úortham, and this policy shall attach to such steamer, her hull, etc., to the same extent as if this policy were originally and specifically written upon the steamer so substituted instead of upon said steamer. Uotice of such substitution to be given this insuranee company at the time it is made, or as soon thereafter as is practical.” It is under this provision in the policy that the substitution was made. Upon examination of this clause in the policy it will be seen that it does not provide in any way for a resubstitution of the Northam after another steamer has been put in her place. The attaching of the policy upon the substituted steamer is not limited so that it shall continue “ only .so long as she runs upon the line,” or “ until the Northam shall resume her place upon the line,” or equivalent words, but the policy, after the substitution, by its express terms, attaches to the substituted steamer to the same effect as if it wrere originally and specifically written upon her, instead of upon the Northam. The policy was originally written upon the Northam for one year from the 4th day of January, 1890, and when the policy attached upon the substituted steamer it is quite clear that it attached upon that steamer to the same extent, and for the same time, as it had been originally written upon the Northam; that is until the 4th day of January, 1891. There is nothing in the words of the policy from which it can be inferred that there was any general and standing right of resubstitution of one steamer for another; but, if we stand upon the words of the policy, it is quite clear that when there has been a substitution the policy attaches upon the substituted steamer once for all during its life. But as in all cases where a contract is to be construed the action of the parties under it may be referred to as throwing light upon their intention with regard to it, so in this case it is proper that we should refer to the evidence to ascertain whether the contract had been construed by the parties to permit a resubstitution of steamers from time to time. It is fairly to be inferred from the testimony of Hr. Lethbridge, an agent of the company, that it was the custom of the plaintiff to give notice from time to time that one steamer had been withdrawn from'the line, and that another steamer had taken her place, and that upon the receipt of such notice.it was permitted that the insurance should be changed from the steamer upon the line to the substituted steamer. One of such' notices is produced in the case, and it appears that there had been various other resubstitutions, from time to time, of one steamer for another. In view of this course of business, we think it is fair to construe the contract as permitting a resubstitution of one steamer for another when the substituted steamer shall have been withdrawn from the line, and the original steamer resubstituted in her place. But the same evidence shows that notice was always given to the defendant of the resubstitution, and the construction thus given by the parties to their own contract is of great weight to show that such notice was required. In view of these facts, it seems'to us that there could be no resubstitution without a notice to the defendant of that fact. It is expressly provided in the contract that notice of the first substitution must be given to the insured, and until that notice has been given the substitution clearly cannot take effect. As we have seen, when that substitution takes effect, the policy is withdrawn from the Sort ham, and attached to another steamer, to the same extent as it had been originally attached to the Xortham. While the defendant is undoubtedly charged with knowledge of the customs of business of the insured (1 Phil. Ins. § 140), and therefore it may be claimed that it was bound to know that the plaintiff was in the habit of substituting one steamer for another, it was not bound to know that any particular steamer was running upon the line at any particular time. Neither was it bound to know that one of the three steamers of the plaintiff was running upon the line, because the policy provides that the substitution may be not only of any steamer that -is owned by the plaintiff, but any steamer that is chartered by the plaintiff. It has no means of knowing, therefore, what is the situation of any one of the steamers, and it had a right te rely upon the situation of affairs as disclosed to it by the information which it received from the plaintiff from time to time, as indicating upon what steamer the risks they had written applied. When one steamer was substituted for another under any given policy, the resubstitution, if there was one, was to be made by the assured. Unless notice of it was given to the insurer, it would be utterly impossible for it to ascertain upon what steamers its risks had applied at any given time, or what was the nature of the risks • which it was insuring. It is obvious that any construction of the contract which would place the insurer in such a condition as that with reference to the policies it had issued would be a hard and unreasonable one, and ought not to be adopted, unless it necessarily follows from the acts of the parties themselves, or the words of the policy. But when we examine the acts of the parties themselves, to the meagre extent to which they have been shown by this evidence, it seems that they gave notice of resubstitution as well as of the original substitution. In the only case in which there is any proof that there was a resubstitution, notice of it was given to the insurer. We are quite clear, therefore, that, even if there could be under the policy, as construed by the acts of the parties, a resubstitution after the first substitution had taken place, notice of that resubstitution must be given to make it effectual and binding, precisely as notice of the original substitution must have been given.

But it is said that upon the evidence there was sufficient to-require the court to submit to the jury the question whether such notice had not been given to the insurer. The evidence-relied upon to produce that effect is a letter of May 10, 1890,. sent to the agent of the defendant, advising him that the Elm City would on Monday be withdrawn from the route, and the-Continental would resume her place for the season; “the policy which you hold on the latter boat will then apply.” It is claimed that the jury might infer from this evidence that, the insurance company had notice that the Continental had. ceased to run upon the route in the place of the Mortham, and the Elm City had been substituted in her place, and that the Continental was again to go back ; and it is said the necessary inference of fact was that the Mortham was running upon the line. We do not see that any such inference follows. The6 defendant was not called upon, nor was it supposed, to know the exact situation of any steamer upon the plaintiff’s line. Eor aught which is made to appear to it, the Mortham, which was laid up in February, was still laid up, and was not running. There is nothing in the evidence to show that it had any reason to suppose that the Mortham had gone back upon the line, and for that reason it seems to us that the letter of May 10th could not, 'by any inference, be construed to be a notice to it that the Mortham had been resubstituted under her policy of insurance for the Continental. But it is said that, unless that notice is to be implied, it would be necessary to say that there-were two policies of insurance upon the Continental at the same time. Admitting that to be the case, it is a matter of no particular importance, unless the defendant took advantage of it. It might well be that in the various changes back and forth there would be at some time double insurance upon one or other of the ships. But if the defendant made no objection to it, the policy was still valid, so far as it was concerned, and no inference of notice one way or the other can be drawn from it. For these reasons it seems to us that the Mortham had not been effectively resubstituted in the place of the steamer to which the policy attached by the notice of February 24th, and that there ivas nothing from which the defendant could infer such a resubstitution, and the action of the court in ordering a verdict for the defendant was proper.

The motion for a new trial should be denied, with costs-, and judgment ordered for the defendant upon the verdict.

YAM BRITMT, P. J., and O’BRIEM, J., concur.

BARRET, J.

(dissenting).—The plaintiff’s policy was: “ On steamer O. H. Mortham, * * * or whatever steamer may be employed upon the line in place of said steamer 0. H. Mortham by the said Mew Haven Steamboat Company; said ■ vessel to be employed between Mew York and Mew Haven, Conn., and intermediate ports and places,” etc. The only other material clause as to the nature of the subject of insurance is a later one, which reads: Privilege to substitute any other steamer owned or chartered by the assured, to run on said line in place of said steamer 0. H. Mortham, and this policy shall attach to "such steamer * * * to the same effect as if this policy were originally and specifically written upon the steamer so substituted, instead of upon said steamer.” These words leave no doubt as to the precise intention of the parties. The first'clause shows that the Mortham was not the absolute subject of insurance during the whole period. The insurance was upon the Hortham, “ or whatever steamer may be employed upon, the line in place of said steamer.” As soon as the Hortham ceases to run, the alternative provision takes effect, and the insurance becomes- transferred to the vessel taking her place upon the line from Hew York to Hew Haven. But the policy then attaches to the latter steamer to the same effect ” as it had to the Hortham; subject, that is, to the same right of substitution in the plaintiff. Thus the plaintiff was entitled to make as many substitutions as it chose of steamers to run in the Hortham’s place, and the insurance attached at once to the vessel so substituted. It is equally plain that, should the Hortham resume work, it would again become the subject of insurance; not, however, under the substitution clause, but as the vessel originally insured. In the absence of other provisions, the insurance would have attached to it during the whole of the year from January 4, 1890, to January 4,1891. The insurance is displaced only in favor of whatever steamer may be employed ” in place of it. If, however, there should be no such steamer;—if, that is, the Hortham should be doing her own work,—then the insurance would be upon her; and this would be true of every hour and minute throughout the whole of the insured period, no matter what prior changes might have been made upon the line. The intention was to indemnify the plaintiff for a year against loss upon the Hortham, or the doer of the Hortham’s work.

So far, then, the plaintiff’s right to recover seems clear. The only condition that could possibly affect that right will now be stated. The policy, by a clause immediately following the second one above quoted, giving the plaintiff its privilege of substitution, provides for “ notice of such substitution to be given this insurance company at the time it is made, or as soon thereafter as is practical.” The meaning of this is clear. Whenever another steamer is substituted to run' for the Hortham, the defendant is entitled to notice of the fact. Be the substitutes for the Hortham one or many, in each case the notice is necessary. But this provision cannot be tortured into meaning that the defendant must be notified when the Hortham resumes work. It is only in the case of a substitute for the Hortham that the notice is required, and the Hortham can neither be a substitute for herself nor a substitute for a substitute. She is the boat originally and principally insured,—the contemplated chief worker on the plaintiff’s line. Other steam ers may for a time take her place, and do her work; and notice on these occasions is necessary. But to hold that notice is required when the Hortham again takes her place is to read into the policy something which is not there, and to commit a decisive breach of the fundamental rule of law that provisions in policies of insurance are to be construed most strongly against the insurer. If, however, this construction of the policy were not the true one, the plaintiff was certainly entitled, as it requested, to have the jury decide whether or not it gave the defendant sufficient notice of the revocation of the substitution of the Continental for the Northam, and the reinstatement of the latter. On May 10, 1890, as the defendant knew, the Elm City was running as substitute for the Continental under other policies upon the latter, amounting in all to precisely the same sum as that for which the Northam was insured. On this 10th day of May, 1890, the defendant was notified that the Elm City was entirely withdrawn from the route, and that the Continental will resume her place for the season. At this time the Northam had been running again for nearly a month. The defendant knew that the plaintiff employed three boats on this line,—the Northam, the Continental, and the Elm City; the latter being ordinarily a substitute boat. There is some evasive testimony • on the part of Lethbridge, the defendant’s general agent, who executed the policy in suit, as to his knowledge of this fact; but that he did know it is perfectly apparent. Aside from what must have been disclosed to him by the policies and the substitutions made under them, we have his direct statement, on redirect examination, that “ the line owned three boats, and insured only two of them, with the privilege of substituting the other boat in place of the two insured, in case they required it.” As the defendant’s policies were on running boats, the plain inference is knowledge, on its part that the plaintiff kept two boats constantly running. Hence a notice that the Elm City was to he taken off the route, and that the Continental was to resume her place, plainly indicated that the Northam was back at Avorlc at the time; otherwise the plaintiff would have had only one boat running,—an unlikely contingency, which would have subjected the plaintiff to double premiums for a single insurance. This is apparent when we consider that the moment the Continental ceased to be a substitute for the Northam, she was no longer insured as such substitute under the Northam’s policy. She then resumed her insurance under her own policies. Consequently the two premiums—one upon the Northam’s policy, and one upon the Continental’s policies—could not have prócluced double indemnity to the Continental in case of loss. They would, have been wasted, or, rather, one would have been wasted, upon the Continental’s single indemnity. The defendant could not have believed, after learning that the Elm City was withdrawn from the route, and that the Continental had resumed her place for the season, that the latter thereafter continued to run upon her own independent account, and at the same timé as a substitute for the Northam. When the Continental resumed her place for the season, the defendant therefore knew at once that she had ceased to be a substitute for the Northam. What then ? The Elm City was gone from the route, the Continental was no longer a substitute for the Northam, but. was running independently under her own original policies. And the Northam? What was the plain inference as to her? Naturally that she, too, had returned to her work ; that, like the Continental, she had resumed her place upon the line. What other alternatives were there ? And how do these other alternatives ■compare in the line of probability Avith the preceding view ? There Avere but íavo alternatives aaTlícIi could have entered the defendant’s mind,—one that the plaintiffs Avere running their line Avith but a single boat; the other that the plaintiffs had chartered an outside boat to again act as a substitute for the FTorthanl instead of the Continental. But these were the barest of possibilities, and could hardly have been contemplated by the defendant. The most natural inference AAras certainly that, as the FTortham’s substitute was gone, the FTortham herself had resumed her original place upon the line, and under her ■own policy. Hoav, then, can it be said that the jury might not properly have found that the notice of May 10th, coupled with the defendant’s knoAvledge of hoAV the plaintiff’s line was equipped and run, did convey to it the information that the Mortham was back at work, and had resumed her original place upon the line ? We think the jury might well have found that this notice, under the circumstances, did substantially convey such information, and, if it did, the requirement, if any, that notice of resumption 'should be giAren, was satisfied.

The claim that the action is barred by the provision in the policy that “ all claims shall be void unless prosecuted AAÚthin six months from the date of the loss,” is untenable. This six-months period of limitation does not begin to run until the loss becomes payable under the terms of the policy. Steen v. Insurance Co., 89 FT. T. 315, 323. The policy provides, “Loss, if any, to be paid Avithin thirty days after proof of same.” The proofs of loss were delivered to the defendant on February 3, 1891, and the period of limitation did not commence till 30 days after this date, or March 5, 1891. Six months from the latter date Avould be September 5th, and the action Avas commenced August 19th.

The exceptions of the plaintiff should be sustained, and a new trial granted, Avith costs to the plaintiff to abide the event.

IFTGBAHAM, J., concurs.


source: Caselaw Access Project

author: BROWN, P. J.

license: Public Domain

text:
    Townsend Thorn v. Henry Hall, Jr.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    "Wills—Extending time to pay debts.
    A provision in a will that suit should not be brought by the executor within two years from testatrix’s death on debts due from her “ friends ” is in the nature of a bequest; and any one claiming under the provision must show that he was one of the beneficiaries intended by the testatrix, and that the condition of the estate is such that the bequest is without prejudice to the rights of creditors.
    Appeal from trial term, Orange County.

      Action, by Townsend Thorn, executor of the will of Mary A. Smith, deceased, against Henry Hall, Jr., for money loaned by the testatrix, in her - lifetime, to defendant. From a judgment entered on the decision of the court on a trial without a jury, defendant appeals.
    George E. Miner, for appellant; John J. Beattie, for respondent.
   BROWN, P. J.

—This action was brought by the plaintiff, as the executor of the last will and testament of .Mary A. Smith, deceased, to recover the sum of $1,150.27, alleged to have been loaned by the testatrix in her lifetime to the defendant. By the answer, the making of the loan was denied; and, for a separate defense,'it was alleged : That, by the last will and téstament of the said testatrix, it was provided as follows: “ And whereas, I now hold obligations against certain of my friends, I direct my executor not to urge the payment of any such obligations before the space of two full years from the date of my decease.” That, during the lifetime of said testatrix, the defendant was her friend; and that two years had not elapsed since her decease; and that, consequently, the plaintiff was without power or authority to maintain this action. The said Mary A. Smith died in the month of November, 1894, and this action was commenced in the month of May following. It appears from the testimony that the defendant was a manufacturer at Highland Mills, in Orange county, and also kept there a general country store; that the said testatrix was in his employ for several years; and the defendant testified that their relations were friendly up to the time of her death. The provision quoted from the will was in the nature of a legacy to .such persons as should come within its terms, and were within the contemplation and intent of the testatrix. She could, of course, have surrendered to any of her creditors the whole or any part of a debt due to her, and she could likewise fix the terms upon which alone her executor would be' permitted to enforce payment of any debt due to her estate. Such a provision is entirely legal, and is. not unusual, and might, under certain circumstances, be of great value to the debtors of a deceased testator. Like all legacies and bequests, however, such a provision must be so certain and definite in its terms that the beneficiaries thereof can be identified; and, unless it can be ascertained who are entitled as legatees, the provision cannot be enforced. In the testimony before us, there is nothing to indicate whom the testatrix intended by the use of the term “ my friends.” The will was drawn by Mr. Benjamin Hazard, who was sworn as a witness on the trial in behalf of the defendant. In relation to the clause of the will under consideration, he testified as. follows:

“The Court: There is a provision in the'will about some obligations that she held against some of her friends. Did she make you understand what that was about % A. Yes, sir. Q. What was that ? A. There seemed to be a little hesitancy about mentioning names, and I said, ‘ I guess it ain’t particular.’ ‘ Certain of my friends,’ I thought, would cover the whole ground. She didn’t want them distressed. She did not name any of them. I did not understand from anything that she said Avho she meant, in particular or in general. She did not say as to the nature of the indebtedness. I don’t think as to Avhether it Avas note, loan, or how. She said there were persons or a person indebted to her, but I couldn’t understand Avho it was, or the amount. I didn’t like to inquire. She didn’t tell me. I only thought that Avould cover the ground. I don’t remember that she said anything particular that led me to draAV that provision of the Avill about the two years’ Avaiting; only I thought from the conversation we held—I told her there must be some definite time. 1 don’t remember Avhether she named the two years or some of the family. Others Avere talking; lots of them. There seemed to be a general universal acceptation of everything that Avas said, and, in the end, she accepted and ratified everything that was done; said that will cover the whole ground. Ho one interrupted her, or suggested AArhat should go in the Avill.”

The burden of proving that he AAras included Avithin the provision of the Avill quoted rested upon the defendant. It was not sufficient for him to show that he Avas upon friendly terms Avith the testatrix during her lifetime, but it Avas necessary for him to prove that she included him among “ her friends,” and intended him as the beneficiary under her will. She did not intend to extend the time of payment of all debts due to her estate, but only of those due to her from friends ” for which she held “ obligations.” The use of the Avord “ obligations ” seems to contemplate a written instrument, like a note or bond. In this case there aauis nothing of that character, and we think the defendant failed to shoAV that he fell Avithin the provision of the will.

Again, a testamentary provision of the character of that under consideration must be interpreted and enforced with reference to the condition of the estate of the testator. The executor is a trustee for the creditors, as well as for the legatees. While the latter are entitled to haATe such proAÚsion strictly enforced for their benefit, their rights are subject to the rights of creditors, and the latter are entitled to have their debts paid in due course of administration. Hence Ave think it Avas not only necessary for the defendant to prove that he was one of the beneficiaries intended by the testatrix, but it Avas also incumbent upon him to give some testimony as to the debts and assets of the estate, from aaTucIi it could be determined that the condition of the estate Avas such as to permit the executor to extend the payment of the debt for two years, AAÚthout prejudice to the rights of creditors. Ho testimony of this character was offered. "We have examined the exceptions in the case, but none of them are well taken.

The judgment must be affirmed, with costs.

All concur.


author: DALY, P. J.

text:
    O’Reilly, Skelly & Fogarty Co. v. Bartholomew A. Greene.
    (Supreme Court, Appellate Term, First Department.
    November 25, 1896.)
    1. Foreign corporation—Failure to obtain certificate—Pleading.
    Failure of a foreign corporation to obtain a certificate of authority to do business in New York (Laws 1892, c. 687, § 15) is a matter of defense in an action by such corporation brought in New York, and cannot be taken advantage of by demurrer, but only by answer. 40 N. Y. Supp. 360, affirmed.
    2. Same—Assigned contracts made out of the state.
    Laws 1892, c. 687, § 15, which provides that no foreign corporation shall sue in New York, on any contract made by it therein, without first obtaining a certificate of authority, does not apply to a contract made out of the state by a third person, and assigned to such corporation, or to contracts made before the enactm ent of the statute. 40 N. Y. Supp. 360, affirmed.
    3. Same—Right to sue after expiration of charter.
    A foreign corporation which, by the law of its domicile, continues to exist after the expiration of its charter, for the purpose of suing on debts which accrued before such expiration, may also sue in such case in New York. 40 N. Y. Supp. 360, affirmed.
    4. Law of another state—Pleading—Sufficiency.
    The law of another state under which a corporation is authorized to sue on its debts after the expiration of its charter is sufficiently pleaded in New York by an averment “that, under and pursuant” to such law, -suits may be brought.
    5. Same—Demurrer—Want of capacity to sue.
    A demurrer in an action by a corporation, on the ground that the complaint does not state sufficient facts to constitute a cause of action, does not raise the objection of want of capacity to sue.
    Appeal from city court of Eew York, general term.
    Action by the O’Reilly, Skelly & Fogarty Company against Bartholomew A. Greene. From a judgment of the city court affirming a judgment overruling a demurrer to the complaint, defendant appeals.
    Richard J. Morrison, for appellant; Edward W. S. Johnston and Johnson & Johnston, for respondent.
   DALY, P. J.

—The action was brought upon an agreement made January 28, 1890, by the defendant, with the firm of O’Reilly, Skelly & Fogarty, to pay them $155.70, the amount of a claim which they had against Francis McCabe for goods sold and delivered to him, at his request, of that value, and at that stipulated price, and for which he was at that date indebted to them. The firm of O’Reilly, Skelly & Fogarty, on January 3, 1891, assigned the cause of action against the defendant to the plaintiff company, which was organized and incorporated at that date under the laws of the state of West "Virginia, to transact business for a term expiring on December 31, 1895 ; and it was alleged in the complaint that under and pursuant to the said laws of that state, when a corporation shall expire, suits may be brought in the corporate name, in like manner and with like effect as before such expiration, as far as shall be necessary or proper for collecting the debts or claims due to the corporation. The defendant demurred— First, that the complaint did not state facts sufficient to constitute a cause of action ; second, that the plaintiff has not legal capacity to sue, as it is not an existing foreign corporation, and that it is not alleged that it is authorized to do business in the state of New York, and maintain an action in the courts of this state, and has procured a certificate from the secretary of state that it has complied with all the requirements of the law authorizing it to do business in this state, and that the business of plaintiff is such as may be lawfully carried on by a corporation incorporated under the laAvs of this state for such and similar business ; and, third, that there is defect of parties defendant, in that Francis McCabe has not been made a defendant. The last objection is not urged by appellant in his brief.

Appellant relies upon the fact that the complaint failed to allege compliance Avith section 15, c. 687, Luavs 1892, requiring a foreign corporation to obtain from the secretary of state a certificate of authority to do business in this state; but the question AAdiether such compliance must be alleged and proved by the plaintiff as a part of his cause of action cannot be regarded as an open one in this court. It has been held that the Avant of such a certificate is matter of defense, to be pleaded by the defendant, and the complaint, therefore, is not open to •objection on that ground. Nicoll v. Clark, 13 Misc. Rep. 128; Lumber Co. v. Russell, 84 Hun, 114.

The statute, so far as it is essential to the point under consideration, provides:

“ No such corporation now doing business in this state shall do business herein after December 31, 1892, Avithout having procured such certificate from the secretary of state; but any laAvful contract previously made by the corporation may be performed and enforced within the state subsequent to such date. No foreign stock corporation doing business in this state without such certificate shall maintain any action in this state upon any contract made by it in this state until it shall have procured such certificate.”

Appellant claims that the case does not fall within the exemption found in the sentence next to the last, of “ any lawful contract pre-viously made by the corporation,” because this contract Avas made by the plaintiff’s assignor. But this is of no conseqence, because, if the action is not upon a contract made by the corporation, then the cause is not Avithin the operation of the statute at all, which only affects contracts made by the corporation in this state. Shelby Steel Tube Co. v. Burgess Gun Co., 8 App. Div. 444, 40 N. Y. Supp. 871. The case, not being within the operation of the statute, need not, of course, be brought within the exemption. The right of the plaintiff as a foreign corporation to sue in this state is not dependent upon the act of 1892, above cited. It is conferred by the Code (section 1779), giving the same rights of maintaining actions as are possessed by domestic corporations, except as otherwise specially prescribed by law. This act of 1892 only prohibits actions upon contracts made by corporations in this state after its passage until they shall have procured the necessary certificate. Actions upon contracts made by other parties,' and assigned to the corporation, which is the case here, are not within the statute.

These considerations also dispose of the objection that the complaint does not aver that the plaintiff is a stock corporation, and therefore entitled to do business in this state; and that it is not alleged in what state the contract was made.

As to the objection that the plaintiff is not an existing foreign corporation, and therefore has not capacity to sue, owing to the expiration of the time for which it was incorporated in ■this case, it does not appear that the corporate existence is terminated, although the term for which it was organized to transact business has expired. On the contrary, the corporation appears to be continued by the statutes of west Virginia for the purpose of bringing actions to collect debts and claims due it. “ So long as the plaintiff exists, and is recognized by the courts and authorities of that state [in which it is incorporated], it is entitled to the same recognition here, unless it appears it was formed for purposes illegal here, or was doing acts prohibited by the laws of this state to its own citizens and corporations. Demarest v. Flack, 128 N. Y. 205, 40 S. R. 383.” Vinegar Co. v. Schlegel, 143 N. Y. 537-542; 62 S. R. 826. The allegations of the complaint, when taken together, indicate that the corporation has expired so far as its right to transact new business is concerned, but not so as to prevent the collection, in its corporate name, of its debts. Its existence is therefore continued for a limited and specified purpose. There is nothing in the complaint to show that the corporation is defunct, and that its affairs are being administered by trustees or a receiver. In Rodgers v. Insurance Co., 148 N. Y. 34, cited by appellant, a dissolution of a domestic-corporation had been decreed by our own courts, and a receiver-appointed. ■ A judgment had been recovered against it in Illinois, under the statute of that state which continued a dissolved insurance corporation for two years for the purpose of' winding up their affairs, and prosecuting suits by and against, them. An order was asked in this state directing the receiver here to pay the amount of that judgment, and it was held that the judgment could not bind the receiver, and should not be satisfied in the manner sought out of the assets in his hands. The facts are different from the case before us, and the principle involved is not the same, for the corporation there had been actually dissolved.

As a corporation, by the laws of the state of its incorporation, is, in effect, continued in existence for the purposes of suits by it to collect its debts, the provision of our statute (Laws 1892, above, § 30) providing that, upon dissolution, the directors or other persons appointed by the legislature or by a court of competent jurisdiction shall be the trustee of its creditors, stockholders, and members, with authority tó sue for and collect its debts, has no application. The laws of West Virginia are sufficiently pleaded by the averment that, under and pursuant to ” them, suits may be brought, under the circumstances of this case, in the name of the corporation. Berney v. Drexel, 33 Hun, 34.

Appellant objects that the complaint fails to aver that the plaintiff has paid the license fee required (by Chapter 240, Laws 1895) of certain foreign corporations authorized to do business in this state, of .one-eighth of 1 per cent, upon the amount of its capital stock; the statute prohibiting actions for recoveries by such corporations unless they first obtain a receipt for such license fee, as well as the certificate of authority prescribed by chapter 687, Laws 1892. It would seem that the principle of the case of Nicoll v. Clark and of Lumber Co. v. Bussell, already cited, must apply to this statute, so similar in its provisions to the one under consideration in those cases, and requires us to hold that the absence of such an averment is not a demurrable defect; but, apart from that consideration, the objection in question does not go to the sufficiency of the facts stated as the cause of action (Lumber Co. v. Bussell, above), but rather to the capacity of the plaintiff to sue, and, as such, must be specified as a distinct ground of demurrer, which has not been done. Code, § 488, subd. 3; Id. § 490.

The question of the capacity of the plaintiff to sue cannot be raised by demurrer for want of facts constituting a cause of action. Bank v. Edwards, 11 How. Prac. 216 ; Viburt v. Frost, 3 Abb. Prac. 120; Myers v. Machado, 6 Abb. Prac. 198, 14 How. Prac. 149, and 6 Duer, 678; Hobart v. Frost, 5 Duer, 672. Demurrer to a complaint in an action by a corporation on the ground last stated does not raise the objection of want of capacity to sue. Insurance Co. v. Baldwin, 37 N. Y. 648; People v. Crooks, 53 N. Y. 648. And it has been held that an allegation in the complaint that the defendant is a corporation constitutes no part of the cause of action, but simply relates to the character or capacity of the defendant. Adams v. Store Service Co., 59 Hun, 127; 35 S. R. 518.

Finally, it is urged as an objection to the complaint that it does not allege “ at what time the guarantor was to pay the antecedent debt ”; and the appellant cites the case of Donley v. Bush, 44 Tex. 1, as authority for the proposition that the. guaranty of an overdue obligation, which is silent as to the time of payment, does not create a liability to pay a debt at any particular time. That case was decided upon a peculiar state of facts, but has no application = here, for a sufficient reason : the plaintiff has not sued upon a mere guaranty of a debt, but on an express promise, in writing, for value, to pay a •claim against McCabe. A promise to pay, without specifying the time of payment, is a promise to pay absolutely and immediately, and may he enforced with or without prior demand. 'The appellant urges that, inasmuch as the complaint contains an averment that McCabe has not paid the debt upon demand, the promise of defendant is pleaded as a mere guaranty of collection. But the allegation of an absolute promise by the •defendant to pay is not qualified by the averment in question, which is unnecessary to the cause of action, and may be regarded as superfluous.

The demurrer to the complaint was properly overruled, and the final judgment for plaintiff entered thereqn must he .affirmed, with costs.

All concur.


author: HATCH, J.

text:
    Patrick Quinn v. Metropolitan Life Ins. Co.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    1. Life insurance—Breach of warranty—Estoppel.
    A life insurance company is estopped to assert as a breach of warranty the falsity of statements inserted in an application by an agent of the company after it was signed by the insured, and without his knowledge.
    ■3. Same—Impaired health—Representations:
    The fact that the insured had no use of her legs, which was known to the agent of the company who took her application, does not avoid the policy, where she made no representations as to her health.
    Appeal from "Westchester County court.
    Action by Patrick Quinn against the Metropolitan Life Insurance Company on a policy of insurance. From a judgment entered on a verdict in favor of plaintiff, and from an order ■denying a motion for a new trial, defendant appeals.
    Sproull, Harmer & Sproull, for appellant; William Riley, for respondent.
   HATCH, J.

—It is sought by this action to recover the sum secured to be paid to plaintiff by the terms of a policy of insurance issued by the defendant upon the life of Margaret Daly, deceased, who was an aunt of the plaintiff. The defendant seeks to avoid payment upon two grounds: First. That the answers which were given by the insured in the application" for insurance were incorrect, untrue, false, and fraudulent answers, representations, and warranties; that, as such application formed a part of the contract of insurance, and the-answers therein constituted a warranty, there was a breach of the warranty, which avoids the policy. Second. That at the time of the delivery of the policy, and for a long time prior thereto, deceased was not in sound health; that this was a condition precedent to any obligation under the contract, in consequence of which liability thereunder never attached to the defendant. It may be assumed, for the purposes of this appeal, that the insured was not in sound health at the time when the application was made and when the policy was delivered. But this assumption does not necessarily dispose of the question of defendant’s liability under the policy. The evidence discloses that the agent of the company visited the insured, and made application to her to become insured in the defendant company, and that she consented thereto. She was at this time sitting up, and, as the agent testifies, “looked pretty fair; pretty good appearance; healthy woman apparently.” But her inability to use her limbs and move about were known to him at the time. He asked her but two questions,-—her age, and who was to be the beneficiary. She signed the application by making her mark. The agent subsequently filled up the application as suited himself, and delivered the same to the superintendent of the company. The residence of the beneficiary was given as her place of residence, although she resided elsewhere. It is not claimed that the. insured gave false answers to the questions which were asked of her, or that she was aware that the application required answers to other questions, or that the agent assumed to fill in answers purporting to come from her. Nor is it claimed that the answers she did give were false in fact. In the absence of fraud or collusion between the agent and the insured, statements inserted at the agent’s suggestion, not assented to by the insured, which are relied upon by the insurer as constituting a breach of warranty, will not be allowed to operate in defeat of the policy issued thereon, but the insurer will be held to be estopped from setting up the error or falsity as a breach of the warranty. Miller v. Insurance Co., 107 N. Y. 292; 12 St. Rep. 1; O’Brien v. Society, 117 N. Y. 310; 27 S. R. 326. The fraud of the agent alone will not be allowed to operate in defeat of liability, where' there is good faith upon the part of the insured. Upon this question the defendant held the affirmative of the issue (Dougherty v. Insurance Co., 3 App. Div. 313; 38 N. Y. Supp. 258), and, assuming that the insured made and signed the application, and gave truthful answers so far as she was asked, there was nothing appearing upon this branch of the case which would justify a finding that she was guilty of any breach of warranty in the application. It has been held that, when the insured has been guilty of a breach of warranty in making false answers in an application for insurance, the company has the right to avail itself of such breach, even though the agent knew the answer was false. Foot v. Insurance Co., 61 N. Y. 571. But that rule may not be invoked when the insured has been guilty of no misrepresentation, and the agent has mistakenly or falsely made the misrepresentation. Nor does it preclude the insistence upon a waiver where the agent has knowledge of the fact which would work a forfeiture, when the insured or her beneficiary has been guilty of no misstatement, fraud, or concealment of fact. Under such circumstances it becomes the duty of the agent to inform the company, and the jury may find in a proper case that he did so, and waiver may be predicated thereon. Kenyon v. Association, 122 N. Y. 247 ; 33 S. R. 467.

Did the fact that the woman was not in sound health at the time of the delivery of the policy avoid it as a matter of law ? It is the settled law of this state that an insurance company cannot avoid liability by proving facts which would defeat the policy if it had full knowledge of such facts at the time when it issued and delivered the same. Robbins v. Insurance Co., 149 N. Y. 477. The agent of an insurance company is the means of communication between the insured and the company, and where such agent is authorized to solicit applications for insurance, deliver policies, or collect premiums, facts material to the risk, coming to the agent’s knowledge, are presumed to have been communicated by him to the company; and, if he have knowledge of existing grounds of forfeiture at the time of the delivery of the policy, it may be presumed that such forfeiture has been- waived by the company. McGurk v. Insurance Co., 56 Conn. 528; 16 Atl. 263; Insurance Co. v. Wolff, 95 U. S. 326. This rule does not" involve the authority of the agent to waive forfeitures or other conditions of the policy, but is based upon the act of the company itself, resting upon the theory that the company has the notice and chooses to accept liability where the condition is known at the time of the delivery of the policy, or, subsequently coming to its knowledge, it accepts and retains premiums which fall due thereunder. Application of these rules to the evidence in this case shows that the agent had knowledge of the woman’s infirmity, to some extent at least, and the company "continued to collect and receive premiums for two years and eight months after the policy was issued. So far as appears, no medical examination was ever had or required by the company. The court, in submitting the case to the jury, charged that, if the agent who procured the application for insurance was the agent of the company, authorized to represent it, and if the company knew the condition of the insured at the time it issued the policy, then they were at liberty to find a verdict for the plaintiff. We think this charge was correct, and that the evidence warranted the submission of this question to the jury. Nothing which appears in Maloney v. Association, 8 App. Div. 575 ; 40 N. Y. Supp. 918, militates against this view. The court there held that the undisputed facts disclosed no waiver of the terms of the policy, and it was never in fact delivered, so that it might become operative. It does not deny, but assumes, that there might be a waiver of the condition in a case where the facts warranted it.

The present case discloses many suspicious circumstances tending to establish that this insurance was fraudulently procured by the plaintiff in collusion with the agent who obtained the application. But the question was fairly and fully submitted by the court to the jury, and their verdict must be held to have answered, this question in plaintiff’s favor, and we have no authority to interfere.

The court was requested to charge that, if the insured was •of unsound health at the time the policy was issued, the jury must find for the defendant under the terms of the policy. This was refused, and an exception taken. There was no error in this refusal. The request excluded the question of waiver of the condition by the company. The court had already charged, in substance, that the company must have known the condition of the insured at the time it issued the policy, else no liability attached to it. The request was therefore, substantially charged by the court adding thereto the qualification of waiver.

Our view of the case renders unnecessary of consideration the effect of proofs of death, and the statement of the physician therein. Upon the whole case we think that it became a question of fact for the jury to determine whether there was any breach of warranty by the insured, or fraud, and conspiracy in procuring the insurance, and whether the defendant waived the grounds of forfeiture by a delivery of the policy and acceptance of the premiums. The jury having determined these questions in plaintiff’s favor, the verdict must be upheld.

The judgment should be affirmed, with costs.

All concur.


text:
    Clara Rost v. Brooklyn Heights R. Co.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    1. Damages—Evidence—Exhibiting Amputated foot.
    In an action for personal injuries it is error to admit the amputated foot of the injured child in evidence to show the size of the child at the time of the injury, where the child was present at the trial, and defendant admits that the foot was properly amputated.
    2. Same—Instructions—Amount of recovery.
    It is error for the court, in an action for personal injuries, to call the attention of the jury to the amount of the demand in the complaint, and state that they could award no more than the claim, and to charge the jury in such a manner as to authorize them to award the full damages claimed, and to charge that they are to give the full damage that will be adequate to the-money loss sustained.
    Appeal from trial term, Kings County.
    Action by Clara Rost, an infant, etc., by Ernest Rost, her guardian ad litem, against the Brooklyn Heights Railroad Company, for personal injuries. From a judgment entered on. a verdict in favor of plaintiff, and from an order denying a motion for a new trial, defendant appeals.
    Thomas S. Moore, for appellant; Charles J. Patterson, for respondent.
   HATCH, J.

—It is not seriously contended hut that the-evidence was sufficient to warrant a recovery in plaintiff’s favor. The claim is made, however, that defendant has not had a fair trial, in that what transpired thereon had a tendency to unduly create sympathy for the plaintiff, and arouse the passions and prejudices of the jury,'leading them, on account thereof, to render a verdict in excess of the pecuniary loss sustained. The evidence disclosed a case harrowing to the-feelings in the extreme, and presented a condition where a duty was devolved upon the court to carefully guard the trial, and prevent, so far as possible, the jury from being-carried by their feelings away from the questions they were called upon to determine. The plaintiff, a little girl five years. and nine months old, was run over by one of defendant’s trolley cars, and her left leg was cut off by the wheel of the car. The evidence tended quite strongly to establish that defendant was grossly negligent in the management of the car which ran the child down, and every circumstance connected therewith was quite distressing. We have little difficulty, therefore, in seeing that upon the trial, where were developed all the details of so distressing a case, the emotions of the parents, and the pity excited for the little child, must have created an atmosphere tending to destroy the calm and dispassionate consideration of the real questions involved, and to prevent the jury from exercising that cool and deliberate judgment which should alone find place in a court of justice.

The legal questions involved were the negligence of the defendant, and the freedom therefrom of the injured child or her parents ; and, these found in her favor, the measurement of her pecuniary loss. These questions exclude sympathy in their determination, rebuke passion and prejudice, and are to - be settled in the cold realm of sober judgment. And if the court can fairly see that this has not been accomplished upon the trial had, or if the things which were done render it probable that injustice has been worked, it becomes the duty of this court to interfere and correct the wrong, even though it be difficult or impossible to lay hand upon specific error, for the ■ object of all trials is the accomplishment of justice. Platt v. Munroe, 34 Barb. 291; Barret v. Railroad Co., 45 N. Y. 628. And it is the duty of the court, in the disposition of legal controversies, to secure to the parties their legal rights so far as • the same may practically be accomplished. Chamberlain v. Lindsay, 1 Hun, 236.

It appeared upon the trial .that the foot of the child, . which was amputated, had been preserved by the physician in a glass jar. The physician, being upon the stand as a witness, was asked by plaintiff’s counsel to produce it. Defendant’s counsel thereupon stated that it was admitted that the child’s leg had been amputated, and no claim was made that it was not properly done, and objected to its production. Plaintiff’s counsel thereupon stated that the object of its production was “ to show the size of the child at the time.” Objection was made that the production of the foot was not for any legitimate purpose. This was overruled by the court, and the foot was produced. The physician was then asked by plaintiff if the foot showed any burn on it, and he answered, “ It shows the discoloration and blackening that I have spoken of.” Being asked if that is the result of a burn, he said, “ Part of it, I should think so.” To defendant he answered, “I am not certain that it is the result of a burn.” Prior to this examination, and before the foot was produced, the witness had stated: “ There appeared to be a burn on it. There was a blackening and discoloration at the place of the injury, across the'ankle joint. I would not like to say positively that it was a burn, or was not a burn. It simply was blackened and discolored, and may not have been one.” This ruling is now sought to be supported upon the ground that the foot was admissible to show the size of the child at the time of the accident, and also that the discoloration upon it had a tendency to establish that the electrical current had not been shut off at the time the child was run over, and therefore bore directly upon the negligence of the defendant in the operation of the car. It is the undoubted rule that the exhibition of an injury or an injured member of the body to the jury is proper where it is the subject of examination, when such exhibition is necessary to enable the jury to understand the circumstances surrounding the injury, or to obtain a more comprehensive and intelligent conception of the conditions which existed when the injury was received, or of the character of the injury itself. But where such exhibition is not essential or necessary to enable the jury to better understand the conditions, or where the jury may be led to illegitimate considerations on account of it, then it may become improper. Upon the trial of this case the child was present in the view of the jury. They could judge of her size a,t the time of the accident from that observation quite as well as they could determine her size from the appearance of this foot which had been preserved. That it would have undergone some change, we can readily perceive, and the jury could receive little, if any, aid in that direction. What her size was at the time was comparatively of little importance in the determination of any issue which the case presented. Whatever the discoloration was upon the foot, whether from a burn or other causes, it had been fully described by the physician, and there was not a pretense that his testimony in this regard was to be controverted. Dor does it appear that the appearance of the discoloration upon the foot-aided the jury to a determination of the question of defendant’s negligence in the slightest degree beyond what they obtained from the description given of it by the physician. So far as the suggestion is concerned that the denials in the answer of amputation and burns warranted the exhibition, it appears that the defendant admitted the amputation before the foot was produced, and, as before remarked, the testimony of the physician was not expected to be controverted. It may* however, be assumed that technically the rule of evidence authorized the exhibition of the foot. Such rule, however, is-without -force when the legitimate purpose for which the exhibit may be made is slight, and the strong tendency is to work improper and illegitimate results. It is perfectly clear in the present case that the direct tendency of the .exhibition of this mangled foot, coupled with the other considerations already noted," was to arouse the prejudice and inflame the passions of the jury into an angry resentment against.the author of the misfortune. This condition far overbalanced any legitimate purpose for which the exhibit might have been made, and made the exhibition of this foot, under the circumstances of this case, improper.

Upon the subject of damages the court charged the jury:

“ Sixty thousand dollars has been claimed in the complaint. Y"ou cannot give any more than that. You will not give any more to this plaintiff because this defendant is a "corporation* nor will you give any less because it is a corporation. You will not give anything to this plaintiff out of pure sympathy, either by way of giving her a verdict at all or by the way of increasing the amount, because of sympathy alone. By that-I do not mean to say that you are to harden your hearts, and to be unkind and unfeeling, because nothing of that kind is required of you; but. I want to impress upon you that your duty is, under the -law, to give only the pecuniary damages sustained by reason of this hurt, if you decide to give her anything. * * * You will give her whatever you find that damage has been. IE you decide to give her anything, to the full amount, without any reservation, giving her all that she is entitled to by way of compensation for the pecuniary or money loss she has sustained by reason of the hurt that has come to her.”

At the close of the charge the following colloquy took place :

“ Mr. Moore : I except to one part of your honor’s charge. Your honor said that if the jury give damages they are to give-the full, to the utmost, any damage she has received. I except-to that. The Court :• I did not mean to say more than to give the full pecuniary damage,—the full money loss sustained. I did not understand that I said anything that was liable to any criticism. Mr. Moore: I think the rule is that it should be fair pecuniary compensation. The Court: I think they can give full pecuniary compensation. Mr. Patterson : AIL they can give is an adequate compensation for the injury which this plaintiff has sustained. The Court: Well, if you wish it that way, I will make that the phraseology. Mr. Moore: It is either the rule of law or not the rule of law. The Court: What I mean to say is that they are to give the full damages that will be adequate to the money loss sustained by this child by reason of the hurt. (Exception by defendant.)”

The tendency of juries to aivard a verdict for the plaintiff with large damages in this class of cases is as well established as any fact can be, and it is quite proper for courts, in view of this condition, to caution juries in restraint of the tendency. Frequent embarrassment is found in sustaining for the full amount verdicts in negligence cases upon any fair construction of the evidence. The charge in this case authorized the jury to award damages to the full amount claimed, $60,000, and nowhere is the charge in this lespect qualified. The final charge of the court is, after the colloquy with counsel, that the jury should give to the full damages that will be adequate to the money loss sustained, and the only limitation which the court placed upon what would be the full and adequate money loss was the sum demanded in the complaint. By calling attention to the amount of the demand in the complaint, and accompanying it by the statement that they could award no more, it left the jury at liberty to award the sum. The rule of law upon which the damages were to be measured was correctly stated by plaintiff’s counsel,—that they should be adequate compensation for the injury. The learned judge emphasized this by the statement that the jury could give full damages adequate to the money loss. Without passing upon the question whether technical error was committed in the charge which was the subject of exception, we are of opinion that the charge as a whole conveyed to the jury a wrong impression as to the extent of what would be adequate compensation, which may have led them to award that very large verdict which they did,—a verdict which seems excessive in amount, based upon any fair construction of the evidence. Upon the whole case we are satisfied that this verdict may have, and quite likely did, proceed from other considerations than those presented by the testimony, and that justice requires the ordering of a new trial.

The judgment should therefore be reversed, and a new trial granted, with costs to abide the event. All concur, except BRADLEY, J., who concurs in the result.


text:
    Lydia P. Winslow v. George A. Miller.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    Trust,—Powers of trustee—sale of trust property.
    Testatrix devised land to trustees, to manage, as her husband, who was one of them, should direct, but for the best interests of the estate. The trustees were given power to sell, and invest proceeds in bond and mortgage or other security. The income was to be paid to the husband during his life, and at his death plaintiff was to receive the principal. Three days before his death, the husband, as sole trustee, conveyed the land to defendant; taking a mortgage thereon for the entire purchase price, without other security. At the time of the transaction, the husband was ill, though rational, and knew that his death, was near. Held, that the deed and mortgage were void, as they did not represent the fair judgment of the husband, and the sale was not for the best interest of the estate.
    Appeal from special term, Kings county.
    Action by Lydia P. Winslow against George A. Miller to have declared void and set aside a deed of real estate, executed by Robert Miller, as sole executor and trustee under the will of Emily M. Miller, deceased, to defendant. From a judgment in favor of defendant, plaintiff appeals.
    J. T. Marean, for appellant; Horace Graves, for respondent.
   BROWN, P. J.

This action was brought to have declared void and set aside a deed of real estate executed by Robert Miller, as sole executor and trustee under the last will, etc., off Emily M. Miller, deceased, to his son, George A. Miller, and also to have set aside and declared void a mortgage upon said real estate executed by said George to said Robert, as trustee, as aforesaid, to secure the consideration or purchase money of said property. Emily M. Miller was the wife of said Robei-t Miller, and the mother of the plaintiff and said George. She died in September, 1887, seised of the property in question, and leaving a will, whereby she devised substantially all her estate to her executors in trust, to manage the same as her said husband should direct, but for the best interests of her estate. The income therefrom was to be paid to her husband during his life, and upon his death the principal was devised and bequeathed to the plaintiff. By the express terms of the trust, the executors were authorized to sell any or all of the real estate, and invest the proceeds of the sale in bond and mortgage or in other good securities. Robert Miller died on April 23, 1895. IThree days prior to, his death, to wit, on April 20th, he executed the deed in question, and received from his son a mortgage upon the real estate for $8,000, payable May 1, 1900, with interest half yearly. The consideration expressed in the deed was $12,000. Tho property was, however, incumbered by a mortgage of $4,000, and the mortgage executed by George Miller to his father was given to secure all the purchase money which his father would have been entitled to receive upon the sale. The mortgage was acknowledged on April 32,1895, but the deed was not acknowledged by the grantor, feat its execution was proven by the subscribing witness on April 24th, the day following the grantor’s death. Robert Miller was, at the date of the deed, upward of 73 years -of age, and had been sick for some time, and was unable to conduct and manage the business which he had theretofore carried on upon the property. The _ subscribing witness to the deed testified that, at the time of its execution, Mr. Miller was very sick, and was strongly impressed that his illness was going to be fatal; that he had been sick with heart .disease for several years; and that his ailment had gradually become more serious, and he had finally taken to. bis, bed. His physician testified that he had attended him. every day from April 10th until the day of his death; that he-la ad heart disease, .and one lung was also diseased. The physician was .present when the deed was executed, and he testified that, in his opinion, Mr. Miller was at that time rational. Other testimony was given as to Mr. Miller’s sickness, and his. mental and physical condition prior to and at the time the. deed was-executed’; and the court found as facts that he was very.sick when he executed the deed, but that he was conscious, and had full knowledge of the nature and contents of the instrument, and that no advantage was taken of his feeble condition to induce him to execute the conveyance.

We are of the opinion that the deed and mortgage should be set aside- They do not represent the fair judgment of the trustee, and the transaction is not entitled to be treated as such a sale of the property as was intended and contemplated by Mrs. Miller, the testatrix. She created the trust for the benefit of her husband and the plaintiff, and the provision that the power of sale was to be executed for the best interests of her estate referred to -those two beneficiaries. The sale made was not for the benefit of Mr. Miller, as there is no reasonable doubt but that, when he executed the deed, he was aware that he would live .but a very short time. It was not for the benefit of the plaintiff, as it imposes upon her the risk of impairment, of the security, arising from depreciation in the value of the-land, and deprives her of any benefit that might arise from an enhancement -of value. There is great doubt, we think, upon the evidence whether there was a delivery of the deed prior to Mr. Miller’s death; but, -assuming that the deed was delivered, we think -that -a transfer-of the property made under such -circumstances .-as wer® shown iby the testimony should be set aside.

The judgment must ibe reversed, .and a new trial granted, with costs to abide the ©vent,

All concur.


author: WILLARD BARTLETT, J.

text:
    Mary Sullivan v. Carroll Dunham et al.

    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    1. Negligence—Blasting near highway—Evidence.
    In an action for death due to a blow from a falling stump, thrown in the air by a blast fired on private land adjoining the highway along which decedent was walking, it is error to exclude evidence that decedent exposed herself to danger after warning of its presence.
    3. Same—Blasting near highway—Proof of negligence.
    A person injured, while on a 'highway, by objects thrown from a blast on land adjoining, can recover in an action for his injuries without proving negligence.
    Appeal from trial term, Westchester County.
    Action by Mary Sullivan, as administratrix of the estate of Annie E. Kartell, deceased, against Carroll Dunham, Theodore H. Dinkel, and Philip Jewell, for the death of her intestate, caused by the wrongful acts of defendants. From a judgment entered on a verdict in favor of plaintiff, and from an order denying a motion for a new trial, defendants appeal.
    Isaac N. Mills, for appellants; Sumner B. Stiles, for respondent.
   WILLARD BARTLETT, J.

—On June 10, 1895, the plaintiff’s daughter, Annie E. Harten, a girl 19 years of age, was killed on a public highway, known as the “ Harriman Road,” at Irvington, N. Y., by a blow from a falling stump, which had been thrown high into the air and a distance of more than 400 feet by a blast fired on the land of Dr. Carroll Dunham, for the purpose of removing a large elm. The defendants Dinkel & Jewell, who were partners, had been employed by Dr. Dun-ham to do the blasting, and one of them was to superintend the work under the direction of Dr. Dunham’s foreman, whose name was Ward. At the time of the accident, neither Dr. Dunham nor Mr. Jewell was present, but Mr. Dinkel was in the neighborhood of the tree which was blasted out. The plaintiff has recovered a verdict of $8,300 against the defendants for wrongfully causing the death of her intestate, and from the judgment entered upon this verdict, and an order denying a motion for a new trial, all the defendants have appealed.

The complaint charged that the defendants “ wrongfully and unlawfully, and in reckless disregard of human life, did carelessly, negligently, and unskillfully blast and blow out ” the tree; but the learned judge who presided at the trial held that the action was based, not at all upon negligence, but upon a wrong consisting of the improper use of real estate. The jury were told, in substance, that the plaintiff was entitled to a verdict if they were satisfied that the young girl was struck and killed in the highway by a portion or the tree blasted out on Dr. Dunham’s land by Messrs. Dinkel & Jewell, employed by him to do the work under the direction of his foreman, Ward. The court also instructed the jury that the caution which the young lady exercised in respect to taking care of herself was not to be considered, having previously, in the course of the trial, excluded evidence offered by the defendant for the purpose of showing that, after she was warned of the danger, she voluntarily remained in the vicinity. In the instruction and ruling upon the degree of care required of the injured person in such a case, it is clear that an error was committed. Even where the cause of action is not founded upon negligence, but rests upon the commission of a trespass by the' defendant, the party suffering injury therefrom is not wholly relieved of the obligation to exercise some degree of caution. If he is on his own land, or in the public highway, he has a right to assume, in the absence of knowledge or fair warning to the contrary, that others will not endanger his safety by trespass or other wrong. St. Peter v. Denison, 58 N. Y. 416; Ochsenbein v. Shapley, 85 N. Y. 214. But, where there is personal notice of the existence of danger, or fair warning, the law imposes upon the person whose safety is imperiled the duty of using such reasonable means as are at hand to protect himself, and he cannot voluntarily and knowingly remain in a place of risk without losing his right of action for the injury which it was thus in his power to avoid. While I am far from saying that, upon the proof actually before the court in the case before us, the young woman who lost her life neglected any precaution which the law demanded, I think there was error in the exclusion of evidence which was offered on that subject. A witness named Kenny had testified that he met Miss Harten and another girl, who was walking with her on the Harriman Boad; that he had said to them both,“We are going to have a blast, but walk along down the road; you have lots of time that he then pointed down the road, west, and the girls went that way, while the witness went east. The defendants insist that this warning ivas given fully 10 minutes before the blast was fired, in which space of time the- girls had moved only about 249 feet. On the other hand, it is argued, in behalf of the respondent, that there was nothing in the language used to indicate where the blasting ivas to take place, or that it ivas to take place soon ; the girls having been assured that they had ample time to get out of any possible danger. If there Avas no other or further Avarning, I doubt Avliether it Avould be permissible for a jury to find that the girls failed to observe a proper degree of care because they Avalked only 249 feet after they heard it. But the defendants sought to prove that, after the witness Kenny spoke to the girls, he proceeded along the road, and heard cries of “ Fire! ” behind him, to the Avest, in the direction ° Avhere the young women Avere. The trial court excluded the evidence offered for this purpose. I think the exceptions to its exclusion Avere Avell taken, and that it Avas also error to refuse to alloAV the Avitness James Ilalpin to tell Avhether the cries of “ Fire! ” preceding the blast, were loud or not. Evidence as to how loud the cries were, and whether they proceeded from a place where the girls must have heard them, was additional proof bearing on the conduct of the plaintiff’s intestate, which the defendants were entitled to lay before the jury, in order that they might determine, as a question of fact, whether she voluntarily exposed herself td- the danger, after fair warning of its presence.

These erroneous rulings, coupled with the statement in the charge of the learned trial judge, that the caution which the young lady exercised in respect to taking care of herself was not to be considered, demand a reversal of the judgment. I do not think the case should go back for a new trial, however, without an expression of opinion by this court upon the question whether it is essential for the plaintiff to prove negligence in order to make out a cause of action. In the view of the learned trial judge, as has already been pointed out, no proof of negligence was necessary. His ruling to this effect was doubtless based on the authority of Hay v. Cohoes Co., 2 N. Y. 159. In that case, the declaration alleged that the defendants Avrongfully and unjustly blasted and threw large quantities of earth, gravel, slate, and stones upon the dwelling house and premises of the plaintiff, and shut, darkened, and broke the windows thereof. These allegations were supported by proof tending to establish them, it appearing that the damage was inflicted by the defendants Avhile engaged in blasting upon their oavu land. The trial court nonsuited the plaintiff because of his failure to aver and prove negligence. The supreme court and court of appeals held that this was error, and that the defendants were liable without proof of negligence. “ No one questions that the improvement contemplated by the defendants upon their own premises was proper and lawful,” said G-ardiner, J. “ The means by which it was prosecuted were illegal, notwithstanding, for they disturbed the rightful possession of the plaintiff, and caused a direct and immediate injury to his property.” This leading case on trespass by blasting remains an unquestioned authority in this state to-dáy upon the precise point therein decided, which was that the injury done to a plaintiff’s property by a neighboring proprietor, in blasting rocks upon his oavu premises, and throAving them upon the premises of the plaintiff, was a wrong for which the wrongdoer was liable, irrespective of any question of negligence in the manner of doing the blasting. The same doctrine was applied to the case of personal injuries inflicted by blasting, in St. Peter v. Denison, 58 N. Y. 416, where the plaintiff, while working on the property of the Harmony Mills Company, near Cohoes, Avas struck by a piece of stone and frozen earth, thrown out upon him by a blast fired by the defendant in the course of excavations which he Avas making for a canal, under a contract with the state. There it ay as held that the defendant had no right to invade the premises Avhere the plaintiff Avas at work, and that it mattered not whether the invasion was made without negligence. The courts, however, have not extended the principle of Hay v. Cohoes Co. to cases where the injury occasioned on the adjoining property has been due solely to vibrations produced by blasting. "Under such circumstances there must be negligence to render the defendant responsible. Benner v. Dredging Co., 134 N. Y. 156, 45 S. R. 774; Booth v. Railroad Co., 140 N. Y. 267, 55 S. R. 656. But this is placed upon the ground that the vibratory effects of blasting do not constitute an actual trespass. Thus, in the Benner Case, Landon, J., says: “ There was no physical invasion of the plaintiff’s premises by casting stones or earth or other substances upon them, as in Hay v. Cohoes Co.” And in the Booth Case, Chief Judge Andrews, referring to Hay v. Cohoes Co. as a leading case, points out that it involved a physical invasion by the defendant of the land of the plaintiff, while the injury due to vibration from blasting is consequential, and not, technically, a trespass.

A critical examination of the cases which the defendants rely upon as overruling the Hay Case shows that they contain nothing really in conflict with it, when we consider precisely what it decided. The most important of these are Pack v. Mayor, etc., 8 N. Y. 222, in which no suggestion of liability appears to have been made except on the ground of negligence, and McCafferty v. Railroad Co., 61 N. Y. 178, in which the principal questions discussed related to the liability of independent contractors, and in which Earl, C., merely denied the application of the Hay Case to the points there under consideration, without questioning its authority upon the proposition .that the defendants therein were liable without proof of negligence. Reasoning from the doctrine of the Hay. Case and St. Peter v. Denison, supra, it seems clear that one who, in the process of blasting upon his land adjoining the highway, inflicts physical injuries upon one lawfully in the highway, by throwing stones, wood, or other objects from the blast against the person of the traveler, is a wrongdoer, and responsible as such, no matter how carefully the blasting is carried on. Such is the view taken by the supreme court of Indiana in Wright v. Compton, 53 Ind. 337, a case directly in point here. Compton was injured by stone blasted from a quarry by Wright and others, on Wright’s land, which stone was thrown into the highway, along which Compton was passing. Eolio wing the Hay Case, the court held that the defendants were liable, irrespective of any question of negligence. Biddle, J., said:

The question involved is not one of negligence on the part of the defendants. The act charged against them is in itself unlawful,—not the act of blasting and quarrying rock, but the act of casting fragments of rock upon the plaintiff, to his injury. When the act in itself is unlawful, it is immaterial whether it is done ignorantly, negligently, or purposely, except in the measure of damages. Every person must so use his property and exercise Ms rights as not to injure the property or restrict the rights of others. In this case, the defendants could not lawfully so use their stone quarry as to embarrass the rights of travelers along the public highway. The public travel must not be endangered to accommodate thep rivat erights of an individual.”

In my opinion, therefore, the trial court did not err in holding that the plaintiff could recover without proving negligence.

A considerable portion of each brief on the present appeal is devoted to a discussion of the relations between Dr. Dunham, the firm of Dinkel & Jewell, and Dr. Dunham’s foreman. As the evidence on this subject may be fuller and more definite on another trial, a consideration of this branch of the case does not seem advisable at this time.

I think the judgment should be reversed, and a new trial granted, with costs to abide the event.

All concur.


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    Robert Dietz v. Normar S. Dike as Receiver.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 13, 1896.)
    Election of Remedies—Bar to another action.
    A judgment for a pledgor against the pledgee for conversion precludes a subsequent action by the pledgor against the receiver of the pledgee to recover part of the property pledged. 39 N; Y. Supp. 257, affirmed.
    Appeal from special term, Kings County.
    Action by Robert Dietz against Norman S. Dike, as receiver of the firm and property of Field, Lindley, Wiechers & Co., and S. H. H. Clark and others, as receivers of the Union Pacific Railway Company. From an order denying the petition of the Union Pacific Railway Company to compel the ■delivery to it of certain bonds and coupons (39 N. Y. Supp. 257) the receivers of the Union Pacific Railway Company appeal.
    E. Ellery Anderson, for appellants; Frederic A. Ward, for respondent.
   BROWN, P. J.

—The opinion delivered at the special term upon the denial of this motion stated the facts of the case so accurately that they need not be here repeated. It is sufficient to say that, excepting the 7 bonds of the Oregon Railway & Navigation Company, the 140 coupons cut from bonds of the Oregon Short Line & Utah Northern Railway Company, and the item of $2,129.63, the balance admitted by the firm of Wormser & Co. to be due to the firm of Field, Lindley, Wiechers & Co., the judgment recovered by Mr. Dike, the receiver, had no reference to or connection with any property of the Union Pacific Railway Company. As to the item of $2,129.63 the receiver’s affidavit alleged that it did not arise •out the sale of the securities of the railway company only, but was a part of the proceeds of the sale of other securities which the Wonnsers were carrying for Field’s firm, in which the railway company had no right or interest whatever, and that it was impossible to separate the proceeds of the sale of the different securities, or in any way to identify the said item as a part of the proceeds of the sale of the securities of the railway company. It appears from the opinion of the special term that both parties treated the questions presented oh the motion as ones of law solely, and, in the absence of any testimony upon the disputed question of fact as to the above item, we must assume that the allegation that it was a part of the proceeds of the sale of the securities of the Railway Company, was either decided adversely to the petitioners’ claim or was abandoned on the argument.

This brings us to the consideration of the right of the petitioners to recover from the receiver the Y bonds and 140 coupons which appear without dispute to have been a part of the securities delivered by the railway company to Field’s firm, and by that firm pledged to the Wormsers, and recovered from them by the receiver. The right of the petitioners to recover these seetirities was denied by the special term, on the ground that by prosecuting to judgment an action against Field’s firm for the value of the securities, the railway company had elected to treat the refusal of that firm to deliver the securities upon the tender of the debt for which they were pledged as a sale thereof, and it could not thereafter successfully maintain its title to the securities themselves. We are of the opinion that this ruling must be sustained. Ample authority therefor is cited in the special term opinion. Rodermund v. Clark, 46 N. Y. 354; Holler v. Tuska, 87 N. Y. 166; Fowler v. Bank, 113 N. Y. 450 ; 23 S. R. 130 ; Terry v. Hunger, 121 N. Y. 161; 30 S. R. 746.

Flo case to which our attention has been called by the appellants conflicts with these authorities. In Foundry Co. v. Hersee, 33 Hun, 169, the decision of the general term pro-needed upon the ground that the plaintiff ivas not shown to have had knowledge of the fraud at the time of bringing the first action on the contract, and that that action did not proceed to judgment, but was discontinued before it reached that stage. When the case reached the court of appeals (103 H. Y. 2Y), it was affirmed on the sole ground of the lack of a finding or request to find that the plaintiffs, when they brought the action on the contract, knew of the fraud, and the court declined to express any opinion on the question whether, if there had been such knowledge, the fact that the action was not prosecuted to judgment would have relieved the plaintiffs from the imputation of an irrevocable election to affirm the sale. The current of authority in this state is to the effect that, where a party has" the choice between two inconsistent remedies, the commencement of an action will be deemed a conclusive election between them. Such was the case of Conrow v. Little, 115 N. Y. 387, 22 N. E. 347. Judge Dan-forth, speaking of the plaintiff’s election to affirm or avoid the contract there under consideration, said:

They could not do both, and there must be a time when their election should be considered final. We think that time was when they commenced an action for the sum due under the contract.”

In Terry v. Hunger, supra, Judge Peckman, quoting this language, said:

When it becomes necessary to choose between inconsistent remedies, the election will be final, and cannot be reconsidered, even when no injury has been done by the choice, or would result in setting it aside. 2 Herm. Estop. 1172, § 1045.”

The learned counsel has argued that the remedy of the railway company by action against Field’s firm to recover the value of the bonds was not inconsistent with the present proceeding. I cannot conceive of two remedies more inconsistent. Two causes of action, one to recover specific securities, and the other to recover the value of such securities, could not be united in the same complaint, nor could two separate actions, of that character be maintained at the same time. The plaintiffs," if such causes of action were united in the same pleading,, or two separate actions brought, would be compelled by the-court to elect which one they would rely upon. We must here treat Hr. Dike, the receiver, as standing in the place of Field’s firm, with the same right to compel an election as that, firm would have had. Evidently the railway company could not have the bonds, and their value in money at the same time. The two things are impossible, and legal remedies that contemplate such results are plainly inconsistent. The cases of Smith v. Savin, 141 N. Y. 317, 57 S. R. 417, and Russell v. McCall, 141N. Y. 437, 57 S. R. 623, cited by the appellants, do> not appear to have any application to the questions under discussion. It appears from the affidavits before us that in December, 1891, the railway company knew of the pledge of its: securities by the Field firm to the Wormsers, and, with full knowledge of all the facts in reference to the transaction between those two firms, in Harch, 1894, sued Field’s firm to-, recover the difference between the value of the securities and the amount of its debt to that firm, and on August 7, 1894, entered judgment against Field and his partners for $552,-961.17, which the. court adjudged to be such difference. In thus suing for the value of the bonds and crediting thereon the-amount of its debt, the Union Pacific _ Railway Company treated the transaction .as a sale, as it had a right to do, and, having elected to so treat it, the title to the securities passed to Field’s firm. Terry v. Hunger, supra, and cases cited.

The ordermust be affirmed, with $10 costs and disbursements.

All concur.


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    Patrick J Corcoran et a.l v. David Mannering.
    (Supreme Court, Appellate Division, Second Department.
    Dec. 1, 1896.)
    •Joinder oe actions—contract and tort.
    An action for injury to real property, though in the nature of a tort, and an action for rent of such real estate, may be united in a complaint, as they are within the provision of Code Civ. Proc. § 484, permitting the union of transactions connected with the same subject.
    Appeal from special term, Kings County.
    Action by Patrick J. Corcoran and another, as executors and trustees under the will of Samuel Branaugh, deceased, against David Mannering, for injury to real property, and on an assignment of rent. From an interlocutory judgment overruling a demurrer to the complaint, defendant appeals.
    Daniel Kemirs, for appellant. C. S. Mereness, for respondents.
   HATCH, J.

The complaint alleges, so far as is essential to the disposition of the questions presented by this appeal, that the plaintiffs are the executors and trustees of the estate of Samuel Branaugh, who was the devisee of certain real property under the will of Ellen Mannering, subject to a life estate therein of her husband, the defendant in this action; that defendant has been in the possession and enjoyment of said property, has occupied a portion, alleged to be worth about $300 per annum, and has received rents from the remainder in amount of $1,400 per annum; that defendant has suffered the water rates and taxes upon the property to accumulate and remain unpaid for the past eight or nine years; and that the same now amount to about the sum of $1,600. For a second •cause of action, it is alleged that, upon proceedings to probate the said will, costs and expenses were incurred in amount to the sum of $1,770.10, which sum plaintiffs’ testator advanced to the defendant at his request, and, on account thereof, defendant executed and delivered to said testator an assignment -and transfer of sufficient of the rents and proceeds of the said property to pay the interest annually upon the said sum so advanced ; that no part of the money thus advanced has been paid, and interest is now due upon said sum from the 13th day of February, 1883. Plaintiffs demand judgment, that a receiver be appointed to collect the rents, and apply the same in discharge of the water rates and taxes, and in discharge of the said claim for interest, and for other relief.

The demurrer interposed is based upon the ground that •causes of action have been improperly united in the complaint. This is the only ground now urged for our consideration. Appellant insists that the first cause of action alleged is for an injury to real property in the nature of a tort, and the second an action upon contract. Assuming this to be so, the appellant overlooks the fact that the action is in equity, and that .both claims relate to the same subject,—i. e. the real property, ■—and that the main relief sought is the application of the rents produced therefrom in discharge of claims chargeable thereon.. We think they are properly described as transactions connected, with the same subject of the action, and, as such, are brought within section 484 of the Code of Civil Procedure, as causes of action in which a union is permitted. Lattin v. McCarty, 41 N. Y. 107; Lamming v. Galusha, 135 N. Y. 239 ; 47 S. R. 831; Shepard v. Railroad Co., 117 N. Y. 442, 27 S. R. 705 ; Mahler v. Schmidt, 43 Hun, 512. The cases relied upon by appellant, of which Keep v. Kaufman, 56 N. Y. 332, and Wiles v. Suydam, 64 N. Y. 173, are illustrations, were actions at law for damages, where independent causes were attempted to be-united. The rule is plain, and the distinction between the cases clear.

It follows that the judgment appealed from should be affirmed, with costs, with leave to defendant to answer upon payment of costs.

All concur.