text:
    Charles D. Henshaw, App'lt, v. The Pond's Extract Co., Resp't.

      (Supreme Court, General Term, Second Department,

      Filed December 12, 1892.)

    Master and Servant—Negligence.
    While plaintifi was engaged in oiling a machine which had been stopped for that purpose, it was started up by the engineer and plaintiff's hand was injured by the knives. Held, that as the accident was caused by the action of the engineer, a co-employe, defendant was not liable.
    Appeal from judgment entered upon dismissal of the complaint at the close of plaintiff’s case.

      Action for injuries alleged to have been caused by defendant’s negligence.
    Plaintiff was in the employ of the defendant, and while engaged in oiling a machine for cutting witch hazel brush, -which had been stopped for that purpose, the night engineer, who had been substituted for the regular one, started the machine, and plaintiff’s fingers were caught by the revolving knives of the machine, and three fingers were badly cut and mangled, requiring amputation.

      Boger M. Sherman, for app’lt;

      Billings & Cardozo, for resp’t;.
   Pratt, J.

The defendants’ machine was stopped to be oiled ; and while plaintiff was engaged in oiling it the engineer put it in motion, whereby the plaintiff was injured.

The accident was caused by the action of the engineer, a co-employe, for which the employer is not liable to a fellow servant.

We do not find that negligence of defendant was shown, and must affirm the non-suit.

Judgment affirmed, with costs.

Dykman, J., concurs; Barnard, P. J., not sitting.


source: Caselaw Access Project

author: Dykman, J.

license: Public Domain

text:
    Walter Farrington, Ex'r, Resp't, v. The Farmers' Loan & Trust Co., App'lt.

      (Supreme Court, General Term, Second Department,

      Filed December 12, 1892.)

    Trustee—Refusal to deliver securities—Costs.
    Where the trust has ceased and there is no dispute as to the account of the trustee, the latter is bound to deliver the securities held by it on demand, and where it refuses to do so until there had been an accounting in court, it is liable for the costs of an action to obtain such securities.
    Appeal from so much of a judgment as awards costs to-plaintiff.

      David McClure, for app’lt;

      George Card, for resp’t.
   Dykman, J.

The defendant became a trustee of Catharine C. McIntosh, and, as such, held certain securities at the time of her death.

The plaintiff is the executor of Miss McIntosh, and, as such,, requested a delivery of the securities to him by the defendant.. The defendant declined to make such delivery until there had been an accounting in court.

This action was then commenced to compel a delivery of the securities by the defendant to the plaintiff.

The plaintiff obtained a judgment in his favor, with costs, and now the defendant has appealed from that portion of the judgment which awards costs to the plaintiff and fails to allow costs to the defendant.

Prior to the commencement of the action the plaintiff called at the office of the company and had an interview with the secretary,, exhibited to him a certificate of the surrogate that he was the executor of Miss McIntosh, and demanded a delivery of the securities held by the company for her. The secretary declined to make the delivery until there had been an accounting in the court. This action was thereupon commenced.

The position of the defendant cannot be maintained. There was no necessity for an accounting. There was no dispute between the parties respecting the account of the defendant or the securities in its possession.

The plaintiff was ready to take the securities as they were, and it was the duty of the defendant to deliver them at once to the plaintiff upon his demand.

As the company was thus placed in the wrong, the plaintiff was entitled to the costs of the action he commenced to obtain the securities.

The judgment should be affirmed, with costs.

Pratt, J., concurs; Barnard, P. J., not sitting.


author: Barnard, P. J.

text:
    Charles B. Pitt et al., Resp'ts, v. Samuel C. Freed, App'lt.

      (Supreme Court, General Term, Second Department,

      Filed December 12, 1892.)

    Abbest—Action on fobeign judgment—Election of bemedies.
    Defendant contracted a debt by fraudulent representation, but plaintiffs recovered judgment against him in Pennsylvania as on contract .for goods sold. In an action upon such judgment, Held, that having elected to take judgment upon contract, they had made an election of remedies, and could not thereafter make an arrest upon it, or upon the fraud which entered into the contract.
    Appeal from order denying motion to vacate an order of arrest granted in an action upon a judgment recovered in Pennsylvania.

      Isaac N. Miller, for app’lt;

      J. Stewart Boss, for resp’t.
   Barnard, P. J.

The defendant contracted a debt with the plaintiffs by fraudulent representation. The plaintiffs commenced an action in the court of Pennsylvania, where defendant lived, and procured an attachment This attachment was vacated, and the plaintiffs entered up a judgment as upon a contract for goods sold. Mo order of arrest can be granted on the original fraud. The court of appeals held in Baxter v. Drake, 85 N. Y., 502, that a plaintiff is entitled to an order of arrest after judgment when the original cause of action was such as to authorize a plaintiff to .an order for the arrest of the defendant; but that the action should be brought upon the foreign judgment. After the plaintiffs elected to take judgment on contract, they were not at liberty to make an arrest upon it, or upon the fraud which entered into the contract. They have elected their remedy. Caylus v. N. Y., etc., R. R. Co., 76 N. Y., 609; Moller v. Tuska, 87 id., 166.

A new judgment recovered herein in this state would not be for the same cause of action as that in the Pennsylvania judgment.

The order should be reversed, with ten dollars caste and disbursements.

Pratt and Dtkman, JJ., concur.


text:
    Addie V. Tuthill, Resp't, v. The United Life Insurance Association, App'lt.

      (Supreme Court, General Term, Second Department,

      Filed December 12, 1892.)

    Benefit societies—Reinstatement of certificate—Evidence.
    On the re-instatement of a certificate which had lapsed by reason of non-payment of an assessment, the insured made a certificate that he had had no sickness since his original application. On his death the beneficiary and physician stated in the proofs of death that his -health was first affected in March, 1891, which was prior to the date of the cei tificate, and wuich was a mistake, as it should have been March, 1891. Seld, that the truth or falsity of the certificate being in issue on the trial, evidence of the mistake, and as to how it occurred, was admissible.
    Appeal from judgment in favor of plaintiff, entered on verdict.

      Harry Wilber (Edmund T. Oldham, of counsel), for app’lt;

      W. F. O'Neill, for resp’t.
   Dykman, J.

The plaintiff in this action is the beneficiary named in a policy of life insurance issued by the defendant for $3-,000 upon the life of her husband, John D. Tuthill, now deceased.

During the lifetime of the assured he had failed to pay an assessment, which became due and payable to the defendant by the terms of the policy on the 29th day of May, 1890.

By other terms of the policy it lapsed and became void in consequence of the failure to pay such assessment.

To induce the defendant to renew the policy the assured made and delivered to the defendant a certificate in writing in which he declared, among other things, that he had had no sickness of any kind since his original application for insurance.

Thereupon the defendant accepted the overdue premium and re-instated the policy.

This is an action upon the policy and the defendant sets up the falsity of the statement made by the assured to procure the acceptance of the overdue premium and renew the policy.

The cause was tried at the circuit, and a verdict rendered in favor of the plaintiff, and from the judgment entered upon that-verdict, and the order denying the motion for a new trial upon the minutes of the court, the defendant has appealed.

The assured died in September, 1891, and in the proofs of death the plaintiff and the physician both stated that the health of the deceased was first affected in March, 1890. That statement was-erroneous. It should have been March, 1891. According to the testimony of one of the witnesses for the plaintiff the attention of one of the general officers of the company was called to the mistake, and he said it was all right and claims such as this were not-questioned.

Upon the trial the plaintiff was permitted to prove the mistake- and how it happened, and from- such proof it appeared that the-sickness commenced in March, 1891.

The admission of that testimony is now assigned for error, upon the ground that the statements in the proofs of death were in the-nature of admissions and conclusive against the plaintiff in this action. We cannot yield assent to such contention.

The right of the plaintiff to a recovery upon the policy in question depended upon the truth of the certificate made by the deceased to procure its renewal after it had lapsed for nonpayment of premiums, and the proofs of death contradicted that certificate.

If they were correct and the deceased was sick in March, 1890, then his certificate made in May, 1890, was false.

The truth or falsity of the certificate being thus in issue, it became important for the plaintiff to show that it was true by any legitimate testimony. As she had made statements which contradicted the certificate, it was necessary for her to explain them, and the admission of her explanation was not erroneous, especially in view of the fact that the mistake was brought to the attention of the company soon after the proofs of death were furnished.

The testimony went to the jury and the case was submitted to that body of fact triors by a charge which fairly stated the law, and certainly imposed upon the case of the plaintiff a burden as heavy as the defendant could require.

The jury was told that the statements in the certificate to procure a renewal of the policy were an absolute guarantee. That it was not a question of fraud, but a question whether the certificate was, as a matter of fact, true, and further, if the deceased was honest and if he was in error it would avoid the policy.

The trial judge also charged that the plaintiff was at liberty to contradict the statements in the proofs of death. That still if no notice of the error was given to the company it would not be liable. If, after the defendant was notified of the error and an effort made to furnish proof of that fact, the necessity for the presentation of different proof was waived, then the fact that the original proofs contained the statement which would relieve the company was immaterial.

We find the case free from error, and the judgment and order should be affirmed, with costs.

Barnard, P. J., and Pratt, J., concur.


author: Macomber, J.

text:
    Robert Talbert, Resp't, v. James Storum, Administrator, App'lt.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Bill of pabtioulabs—Affidavit.
    In an action originally begun upon a policy against a life insurance company, the plaintiff claiming as assignee, the administrator of insured was_ impleaded in the company’s place, "and moved for a bill of particulars stating the consideration for the transfer of the policy upon an affidavit verified by his attorney, alleging on information and belief that he had no knowledge as to what matters were relied upon by plaintiff to establish a consideration, or facts to establish an insurable interest in plaintiff. Upon the argument of the motion the assignment was produced and was under seal, and to the import alleged in the complaint. Held, that the motion "was properly denied.

      Appeal by the defendant, James Storum, administrator of the goods and chattels of William Storum, deceased, impleaded as defendant in the place of the original defendant, The Mutual Reserve Fund Life Association, from an order denying his motion for a bill of particulars, entered in Erie county, March 18, 1892.

      J. L. Slater, for app’lt;

      B. S. Farrington, for resp’t.
   Macomber, J.

This action was originally begun against The Mutual Reserve Fund Life Association upon a policy issued by that company to William Storum in his life time, in the sum of $1,000, payable to the estate of the insured. A like demand having been made upon it by the defendant, James Storum, as administrator of the goods and chattels of William Storum, the insurance company made a motion at special term interpleading the administrator as defendant in its place, making no defense whatever to its liability to pay to one or to the other of the parties the sum of $1,000, the amount of insurance claimed in the complaint.

The complaint alleged that this policy was issued to William Storum on the 7th day of August, 1883, and upon reference to the policy or certificate, it is seen that by it the company undertook to insure this so called member in the sum of $1.000. The complaint further alleged, that on the 28th day of October, 1883, William Storum, for a valuable consideration, sold, assigned and transferred to the plaintiff such policy or certificate of membership, and all sums of money, interest, benefit and advantage whatsoever, then due or thereafter to arise upon such certificate or policy. That such assignment was, thereafter, and on the 2d day of November, 1883, duly consented to and approved by The Mutual Reserve Fund Life Association, and that the plaintiff possessed an insurable interest in the life of William Storum equal to the amount assigned bjr the policy.

Upon demand being'made and refused, the motion for a bill of particulars was made at the special term upon an affidavit to compel the plaintiff to furnish such bill stating the consideration for the transfer of the policy alleged in the complaint, and the amount of the insurable interest of the plaintiff in the life of the deceased. No answer, as yet, has been interposed by this defendant. The affidavit which was made, not by the defendant, but by his attorney of record, alleged, upon information and belief only, that the defendant has no knowledge as to what matters are relied upon by the plaintiff to establish a consideration for the alleged assignment of the certificate of membership or policy set forth in the complaint, and that the defendant is unable to determine upon what state of facts the plaintiff relies to establish in himself the possession of an insurable interest in the deceased. The affidavit further stated, upon like information and belief, that the defendant was prepared to deny the existence of any consideration for the alleged assignment, or that the plaintiff possessed, an insurable interest in the deceased equal to the amount assigned, and further that by reason of a want of particularity in the complaint of the plaintiff, the defendant was “unable to ascertain the specific propositions for which the said plaintiff contends in respect to the said consideration for the said assignment and the insurable interest, nor is the defendant enabled, in any way, to protect himself against, surprise upon trial of the action. ”

This affidavit is wholly insufficient to enable the court to grant the motion made upon the strength thereof, and accordingly the special term was quite right in denying it. No facts were set forth, nor was there any reason given why the affidavit was not made by the defendant, instead of his attorney. This objection ought to have been, and probably was, fatal to the motion at special term. But aside from the foregoing consideration, however, it appeared at the special term on the production of the assignment alleged in the complaint, that the same was under seal, and was to the import alleged in the complaint, and that the same was consented to in writing by the insurance company by an indorsement thereon bearing date November 2, 1883. The seal to this instrument conclusively imports a sufficient consideration to uphold the transfer. Torry v. Black, 58 N. Y., 185.

Nor is the assignment, as is now argued by the learned counsel for the appellant, an executory instrument, and, hence, it does not come under the rule defined by § 840 of the Code of Civil Procedure, which makes a seal on an executory instrument presumptive evidence only of a sufficient consideration, which may be rebutted as though the instrument was not sealed. There is nothing in the language of the assignment indicating that it was, in any respect, executory. It was absolute in terms.

It is true that an insurable interest, in order to sustain a policy of life insurance upon the life of another person, must be pleaded and proved; but it is doubtful whether this defendant, as the administrator of the estate of the insured, can attack the validity of this assignment of the policy, without averring something more than is foreshadowed in his attorney’s affidavit; but it is not necessary at the present time to pass upon that question.

For the reasons above stated, the order appealed from should be affirmed.

Order appealed from affirmed, with ten dollars costs and disbursements.

Dwight, P. J., and Lewis, J., concur.


text:
    Sophia D. Taylor, Pl'ff, v. The Empire State Savings Bank of Buffalo, Def't.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    1. Savings banks—Restbiction op amount op deposit.
    Section 290, chap. 409, Laws of 1882, making it unlawful for any savings-bank to receive from any individual a deposit in excess of $3,000, was
    . not intended to render a contract void which was entered into between the depositor and the hank in contravention of such statute.
    3. Same—Intebest.
    In such case, the depositor is not entitled to interest on his deposit in excess of $3,000.
    Submission of controversy without action, under § 1279 et seq. of the Code of Civil Procedure.

      John G. Milburn, for pl’ff;

      Charles Daniels, for def’t.
   Macomber, J.

The facts contained in the submission of this case are, that the defendant is a savings bank located and doing business under the laws of the state of New York at the city of Buffalo, and was originally incorporated under chap. 777 of the Laws of 1867, by the name of the National Savings Bank of Buffalo, and, under that name, continued to exist and do business until the 1st day of September, 1892, when, by proceedings taken under chap. 409 of the Laws of 1882, its name was changed to “ The Empire State Savings Bank of Buffalo,” the present defendant.

The plaintiff deposited money in this bank from September 15, 1880, to and including June 16, 1892, and at the last named date a balance existed in her favor, and nowr remains unpaid over the amounts from time to time paid to her, in the sum of $24,272.75. Depositors whose deposits are under the sum of $3,000 object that the defendant is not liable to pay to her any part of her deposits exceeding in amount the sum of $3 000, under § 290 of chap. 409 of the Laws of 1882. On the other hand, the plaintiff claims the further amount of her deposits, less twenty-two per cent ordered to be deducted by an order of the special term in an action brought by the attorney general. The defendant, acting at the suggestion and in the interest of small depositors, declines to pay to the plaintiff more than $3,000. The further claim is made by the plaintiff of four per cent interest on her balance, from time to time, over $3,000, that being the rate of interest paid by the bank on deposits of $3,000 or less, but the defendant denies her right to such interest. Such are the two questions submitted,

Section 290 of chap. 409 of the Laws of 1882, declares that: It shall be unlawful for any savings bank, directly or indirectly, to receive from any individual a deposit or deposits in excess of three thousand dollars, but this limitation shall not apply to deposits arising from judicial sales or trust funds.”

It is not claimed in behalf of the plaintiff that the money deposited by her was trust funds or was produced at any judicial ■sale. But this chapter (chapter 409 of the Laws of 1882), except §§ 68 and 69, and | 312, to and including § 327, was repealed by § 215 of chapter 689 of the Laws of 1892. Section 113 of the last named act contains the following provision : “ The aggregate amount of deposits to the credit of any individual at any time shall not exceed $3,000, exclusive of all deposits arising from judicial sales or trust funds or interest.”

Section 256 of the law of 1882 contains a provision making it lawful for savings banks to receive any sum, or sums, on deposit and pay the dividends thereon. By § 257 of that act the sum so deposited with any dividends or interest credited thereto is directed to be repaid to the depositors, and by § 267 the rate of interest payable on deposits was to be regulated by the trustees according to the principles there laid down, but not to exceed five per cent. The provisions of §§ 256, 257, 267 and 290 are substantially retained in §§ 113 and 123 of the act of 1892.

Section 32 of chapter 677 of the Laws of 1892 has the following enactment; “ The provisions of any chapter of the revision of the general laws, of which this chapter is a part, so far as they are substantially the same as those of laws existing at the time such chapter takes effect, shall be construed as a continuation of such laws, modified or amended according to the language employed in such provisions, and not as new enactments.’’

Section 31 declares: “ The repeal of a statute, or part thereof, shall not affect or impair any act done or right accruing, accrued or acquired, or liability, penalty, forfeiture or punishment incurred prior to the time such repeal takes effect, but the same may be asserted, enforced, prosecuted or inflicted, as fully and to the same extent as if such repeal had not been effected.”

Chapter 677 of the Laws of 1892 took effect May 18, 1892, the date of its enactment. The general banking law of 1892, passed May 18, 1892, chap. 689, took effect on the thirtieth day after its final passage. Hence, it appears that §§ 256, 257, 267 and 290 of the banking act of 1882, chap. 409, were in force until June 17, 1892, and since that time §§ 113 and 123 of the general banking act of 1892, chap. 689, have been in force in place of the former provisions.

It will be observed by the banking act of 1882 no penalty oí forfeiture was imposed upon the depositor in respect to deposits of over $3,000. It was made unlawful by that act for any savings bank, directly or indirectly, to receive from any individual a deposit or deposits in excess of $3,000. But this • submission does not concern any question arising upon an effort made to impose a penalty or punishment upon the savings bank for violation of that provision of the statute. The act of leaving the money at the bank is not declared to be unlawful, and consequently the plaintiff may recover the full amount of her deposits. We are guided to a great extent to this conclusion by the case of Sackett's Harbor Bank v. Codd, 18 N. Y., 240, where the court, per Comstock, J., says : “The receiving bank, I assume, violates the statute, because it exacts a greater discount than it is allowed to take. But is the customer also guilty ? The answer to the question is plain. The statute declares it to be unlawful for a bank or banker to receive foreign notes at greater rate, etc., and it prescribes a penalty of one thousand dollars for each offense. The language in which the offense is defined and the penalty declared evidently does not include the customer making the deposit or delivering the notes. Ho degree of guilt, therefore, attaches in such a case to any one except the corporation and its agents, or the individual banker receiving the notes at the prohibited rate of discount. The act, it must be borne in mind, involves in itself no moral turpitude. It is an offense because the statute declares it to be so, and for that reason alone. It is an offense, therefore, which has precisely the proportions the statute gives to it, and it can have no other or greater.” See, also, the reasoning of the court in Pratt v. Short, 79 N. Y., 437; Rome Savings Bank v. Krug, 32 Hun, 270; affirmed in 102 N. Y., 331; 1 St. Rep., 694; Fifth Avenue Bank v. R. R. Co., 44 St. Rep., 379; Cogswell v. Bank, 59 N. H., 43. There are several federal decisions bearing quite directly upon the question, namely; Nat’l Bank v. Whitney, 103 U. S., 99; Fortier v. New Orleans Bank, 112 U. S., 439; Nat'l Bank v. Matthews, 98 id., 621; Gold Mining Co. v. Nat'l Bank, 96 id., 640.

On the whole, we think that § 290 of chap. 409 of the Laws of 1882 was not intended to render a contract void which was entered into between the depositors and the bank in contravention of such statute.

But the alleged right of the plaintiff to recover interest on her deposits over the sum of $3,000 of principal involves different considerations.

Section 290 of chapter 409 of the Laws of 1882 was amended by chapter 477 of the Laws of 1885, by adding thereto the following clause: “ nor shall it be construed as prohibiting the crediting of interest on individual accounts which may have reached the maximum limit, provided that thereafter no interest shall be allowed on such increase.” If we understand correctly this statute as amended, it was palpably a modification of the original law so as to permit an actual increase of deposits over $3,000, to the extent of the sum which should be credited under the rules of the bank as interest to the deposit. ' But it was something more. It contained the affirmative provision, that no interest should be allowed thereafter on such increase of deposits over and above $3,000. But it is argued by the learned counsel for the plaintiff, that, inasmuch as this act (chapter 477 of the Laws of 1885) was repealed by the act of 1892, that, therefore, there was no prohibition against the payment of interest on deposits in excess of $3,000. Attention is also called to that part of the statute which provides that deposits shall be repaid, witli interest “ credited thereto ; ” and to § 123, in relation to crediting interest, and it is contended that they contain nothing preventing the crediting of interest to deposits which exceed $3,000, and further that if interest were credited, say, to an actual deposit of $3,000, the aggregate amount of such deposit, with the increase of interest, would exceed $3,000, and hence be in violation of § 113 of chapter 689 of the Laws of 1892. But, as we held on the other branch of the case, that the bank cannot be permitted to avail itself of its own violation of the law in receiving deposits so as to deprive an innocent depositor of his money; so, on the other hand, the depositor himself cannot, under this provision of the law, be deemed to be in a position where he could benefit himself by receiving any increase of his deposits by way of intferest. Not to permit the plaintiff to recover the amount actually deposited by her would be to work an unconscionable forfeiture and spoliation in a case where the deposit has not been, by law, declared to be void; but to permit her to receive any benefit by such deposit when the same is declared to be unlawful, would be equally unjust to the small depositors.

We think, therefore, that judgment should be ordered for the plaintiff in respect to the principal; and for the defendant in respect to the interest on deposits over and above $3,000, principal.

Judgment ordered for the plaintiff as to the principal sum of deposits; and for the defendant as to interest on principal sums in excess of $3,000.

Dwight, P. J., and Lewis, J., concur.


text:
    Joseph Kress, Resp't, v. The East Side Savings Bank, App'lt.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Savings banks—Negligence.
    A savings tank having paid out a deposit upon the presentation of a stolen pass-book and forged check, in order to absolve itself from the claim made by the depositor for the return of his deposit, must show affirmatively "that it had complied with the provision of § 28, chap. 871, Laws of 1875.
    Appeal by the defendant, The East Side Savings Bank, from a judgment entered in Monroe county June 3, 1892, upon the verdict of a jury in the county court, and also from an order of that court denying defendant’s motion for a new trial made upon the minutes, in a case brought to that court by an appeal by the defendant from a judgment of the municipal court of the city of Rochester.

      O. G. Davy, for app’lt;

      James S. Havens, for resp’t
   Macomber, J.

The plaintiff was a depositor in the bank of the defendant, which is a savings bank organized under the laws of the state of Mew York; and, on the 9th day of July, 1891, had a balance to his credit in that bank of $164.66. On the last named day the plaintiff’s pass-book was presented to the bank by one Wendell Kress, a brother of the plaintiff, and this balance, with interest thereon, was paid to Wendell Kress by the officers of the bank. But the check upon which this deposit was withdrawn was a forgery, and the bank-book of the plaintiff, which was presented to the bank, was stolen by Wendell Kress from the true owner for the felonious purpose of obtaining .such moneys for his own use.

This fact is abundantly established by the evidence, and the verdict of the jury is conclusive thereon. Indeed, had the jury found that Wendell Kress had any authority from the plaintiff so to withdraw these moneys, its verdict would not have been sustained by any evidence in the case, except by the testimony of certain witnesses, called experts, who were called to testify as to the identity of the handwriting of the plaintiff and of "his brother, Wendell.

The original deposits amounted in all, with interest, to $179.66, and the first of them was made in the year 1889. On June 26, 1891, the plaintiff, himself, personally drew out the sum of fifteen dollars. The only defense interposed by the defendant entitled to much consideration is, that liability cannot attach to it because its officers exercised proper care in paying out these moneys to Wendell Kress. Among the by-laws of the defendant are these : By-Law 15. “On making the first deposit each depositor shall be required to subscribe his or her name in the signature book of the bank, thereby signifying assent to the regulations and by-laws of the bank.” By-Law 20. “ The secretary shall endeavor to prevent frauds ; but all payments made to persons producing the deposit book or duplicates thereof, issued by this bank, shall be deemed valid payments to the depositors respectively.”

These by-laws are printed both in English and German in the pass book presented by the defendant to depositors and the plaintiff, who is a German, when he made his first deposit, signed his' name in the signature book of the bank.

It having been thoroughly established that the balance of the plaintiff’s deposit was withdrawn from the bank through forgery, it was incumbent upon the defendant, in order to absolve itself from liability, to show that it had conformed to the act of 1875, Laws of 1875, chap. 371, and so rendered effective rules 15 and 20, above quoted, thus preventing a recovery by the plaintiff substantially upon the ground of his own loches in permitting his bank book to get into the hands of another person. Shipman v. Bank of the State of New York, 126 N. Y., 318; 37 St. Rep., 376. The authority for the adoption by the banks of the by-law No. 20, above quoted, is § 23 of the act of 1875, which is as follows: “ The sums so deposited, together with any dividends or interest credited thereto, shall be repaid to such depositors respectively, or to their legal representatives, after demand; in such manner, and at such times, and after such previous notice, and under such regulations, t as the board of trustees shall prescribe, which regulations shall be put up in some conspicuous place in the room where the business of such corporation shall be transacted, and shall be printed in the pass books or other evidence of deposit furnished by the corporation, and shall be evidence between the corporation and the depositors holding the same, of the terms upon which the deposits therein acknowledged are made.”

In order to absolve itself from the claim made by the plaintiff for the return of his deposits to him, there was devolved upon the defendant the duty to show affirmatively that it had complied with the provision of § 23_ of chap. 371 of the Laws of 1875, which section remains unaltered in the revision of 1882. Chap. 409, Laws of 1882. It is true, this regulation was printed in the pass book delivered to the plaintiff, but it was never read by him.

This provision for the printing of the regulations in the pass books, and posting them in a conspicuous place in the room where the business of the corporation is transacted, is not by any means a contract entered into between the plaintiff and the defendant. It is a positive, affirmative provision of the statute requiring the defendant to do these things before it can avail itself of this defense, which is wholly statutory and unknown to the common law. Having undertaken to establish this defense, it was incumbent upon the defendant to establish it in accordance with the terms of the statute, and, failing in that, we think it has failed altogether in its defense.

The payment of the deposit to the forger, Wendell Kress, was made by the bookkeeper, who, at times, discharged the duties of teller or cashier. He was unacquainted with the plaintiff, and was aware of such fact of want of knowledge when he paid over the money to Wendell Kress. He had no recollection of comparing the signature to the check with the signature on the book of the bank, though he, from his general course of business, had no doubt he had done so. Knowing that twenty-four days before this time the bank had paid upon the true signature of Joseph Kress a portion of his deposits, he did not look at that signature. The signature book showed that the residence of Joseph Kress was 15 Cleveland Park; but he did not take the precaution to ask Wendell Kress bis place of residence, though he admits that such a question might have led to a discovery of the fraud and forgery. Indeed, he made no inquiry of Wendell whatever, not even to the extent of asking him if he were Joseph Kress. He seems to have neglected the plain and ordinary precautions of detecting any fraud that might be attempted to be perpetrated. Kummel v. Germania Savings Bank, 127 N. Y., 488; 40 St. Rep., 252; Cornell v. Emigrant Savings Bank, 9 id., 72; Saling v. German Savings Bank, 27 id., 975; Fox v. Onondaga Co. Savings Bank, 25 id., 672.

Certain other alleged errors in the record are brought to our attention by the learned counsel for the appellant, but after examining them in detail, we do not find in them any reason for disturbing the judgment appealed from.

The charge of the learned county judge, as a whole, was quite as favorable to the defendant as the facts of the case would warrant.

The judgment and order appealed from should be affirmed.

Judgment and order of the county court of Monroe county appealed from affirmed, with costs.

Dwight, P. J., and Lewis, J., concur.


text:
    In the Matter of the Petition of James Matteson, for leave to issue execution against real property of Ira L. Gates.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Judgment—Lien upon decedent’s kcal estate.
    Under § 1380 of the Code of Civ. Pro., a judgment, existing as a lien against decedent’s real estate at his death, continues as such for three years and six months after letters testamentary or of administration have heen granted, notwithstanding the expiration of ten years from the filing of the judgment roll.
    Appeal by Hiram Putnam, mortgagee, from an order or decree of the surrogate of Chautauqua county, made on the 9th day of March, 1892, adjudging that a certain judgment entered in the clerk’s office of that county, in favor of the petitioner, James Matteson, and against Ira L. Grates, now deceased, was a lien upon the lands of which the latter died seized, and directing an execution to issue thereon against such lands

      Norman M. Allen, for app’lt,
    Hiram Putnam, mortgagee; G. H. Frost, for resp’t,
    James Matteson, the petitioner.
   Macomber, J.

The petitioner, James Matteson, recovered a judgment against Ira L. Gates, now deceased, in a court of a justice of peace in Chautauqua county on the 25th day of June, 1878, for the sum of $184.54. This judgment was duly docketed in the clerk’s office of that county on the 3d day of July, 1878, and hence became a judgment of the county court of that county. At this time, Ira L. Gates, the judgment debtor, was the owner in fee of the real estate described in the petition. He afterwards, however, mortgaged the same to the appellant, Hiram Putnam, in the sum of $1,000 and, after the delivery of such mortgage, conveyed the real estate to his son, Alvin Gates. Ira L. Gates died on the 30th day of December, 1884, intestate, leaving no personal property out of which to pay this judgment or other debts owing by him at the time of his decease or upon which to administer.

An administrator of his estate was duly appointed by the surrogate on the 13th day of September, 1888. The petitioner presented his petition for leave to issue execution December 7, 1891, and an order was made accordingly, from which this appeal is taken. It is conceded that no part of the judgment has ever been collected or paid, and that no execution was ever issued thereon, except as one may have been issued in pursuance of the decree of the surrogate and the concurrent order of the co'unty court of the same county.

This judgment bound the real estate of the judgment debtor for the period of ten years, in pursuance of § 1251 of the Code of Civ. Pro. Townsend v. Tolhurst, 32 St. Rep., 21, and cases there cited.

But upwards of ten years had elapsed before application was made for the issuing of the execution, and hence it is argued for the appellant that the lien of the judgment had ceased, and that, consequently, the right of the mortgagee, Mr. Putnam, had become paramount to that of the judgment creditor. But we think that § 1380 of the Code of Civil Procedure was intended to and does meet the precise case here presented. Among other things, it says: “ Where the lien of the judgment was created as prescribed in § 1251 of this act, neither the order nor the decree can be made until the expiration of three years after letters testamentary or letters of administration have been duly granted upon the estate of the decedent, and for that purpose such a lien existing at the decedent’s death continues for three years and six months thereafter, notwithstanding the previous expiration of ten years from the filing of the judgment roll. But where the decedent died intestate, and letters of administration upon his estate have not been granted within three years after his death by the surrogate’s court of the county in which the decedent resided at the time of his death, or if the decedent resided out of the state at the time of his death, and letters testamentary or letters of administration have not been granted within the same time by the surrogate’s court of the county in which the property on which the judgment is a lien is situated, such court may grant the decree where it appears that the decedent did not leave any personal property within the state upon which to administer. In such case the lien of the judgment existing at the decedent’s death continues for three years and six months as aforesaid.”

As the learned surrogate points out in his opinion, the order of the county court, or the decree of the surrogate, permitting an execution, cannot be made, nor the execution issued, until the expiration of three years after letters testamentary or letters of administration have been granted. The words immediately following seem to dispose, quite conclusively, of the contention here made by the appellant, for they are: “ And for that purpose such a lien existing at the decedent’s death continues for three years, and six months thereafter, notwithstanding the previous expiration of ten years from the filing of the judgment roll.” Nothing, it seems to us, can be clearer than this.

It follows that the decree appealed from should be affirmed.

Decree of the surrogate of Chautauqua county affirmed, with costs.

Dwight, P. J., and Lewis, J., concur.


text:
    Mary Nielson, Resp't, v. Alice Lafflin, App'lt.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Deed —Undue influence.
    In an action brought to set aside a deed executed by plaintiff to defendant, conveying a farm of about fifty acres, it appeared that plaintiff, a married woman, at time of the execution of the deed, was seriously ill with dropsy, and under the influence of opiates and anodynes; did not have the advice of counsel, and that the only consideration for the deed was the assumption by defendant of $3,258 and a debt of $708.93, while the farm was worth $14,000, and that at no time antedating the deed was there any bargain or negotiation for a transfer of the property from plaintiff to defendant, and that defendant had not been on friendly terms with plaintiff. Held, that the judgment of the trial court setting aside the deed should be affirmed.
    Appeal by the defendant, Alice Lafflin, from a judgment of the supreme court, entered in Niagara county, May 9, 1892, on the decision of the court at special term.

      George Clinton, for app’lt;

      My & Dudley, for resp’t.
   Macomber, J.

This action was brought to set aside a deed dated January 7, 1891, executed by the plaintiff to the defendant, conveying to the latter a farm in the town of Niagara, Niagara county, N. Y., of about fifty acres of land.

The plaintiff, who is a married woman, and a daughter of the defendant, was taken seriously ill in November, 1890, with a disease described as dropsy, caused by an enlargement of the liver. The character of the disease gradually increased in virulence until the 2oth day of November, 1890, when it had become dangerous, and the plaintiff was then confined to her bed and suffered great physical pain; and to allay such pain, took large quantities of anodynes daily. These anodynes consisted of spirituous liquors and morphine, administered under medical prescriptions. The physician in charge of the case at this time was in attendance upon the patient from two to three times a day. There was also employed in behalf of the plaintiff a professional nurse. During a greater portion of the time between the 25th day of December, 1890, and the 7th day of January, 1891, the plaintiff was unconscious or irrational, being weak both in body and mind, and incapable of transacting any business which called upon her for the exercise of judgment. The defendant, who had not for some time previously been on friendly terms with the plaintiff, came to the plaintiff’s house on the 25th day of December, 1890, and assisted in the charge and care of the plaintiff’s illness, and the management of her household until January 10,1891.

The trial judge has found, that on the 7th day of January, 1891, while the plaintiff was under the influence of liquors, opiates and anodynes, and while she was very sick, and weak mentally and physically, and incapacitated from doing business which would call for the exercise of her mental faculties' or judgment, and through the procurement and fraud of the defendant in taking advantage of her condition, and through the exercise by the defendant of her influence unduly exerted over the plaintiff, the latter executed and delivered the warranty deed of the premises above mentioned. The plaintiff, in this transaction, did not have the benefit of the advice of legal counsel or of any other person, and the only consideration for the deed was the assumption by the defendant of a mortgage of $3,258, then existing on the premises, and a debt owing by the plaintiff to John J. McIntyre in the sum of $708.93. Having found, as a fact, that the deed was obtained by the defendant through the exercise of undue influence, under the circumstances stated, and for a grossly inadequate consideration, at a time when^the plaintiff did not know or comprehend the legal effect of her act, the court set aside the same upon the plaintiff’s reimbursing the defendant for payment by her of the McIntyre debt of $708.93, and interest on the outstanding mortgage from January 7, 1891.

At the request of the defendant’s counsel the court found, in addition to the matters contained in his formal decision, that, prior to her illness and prior to the transaction above mentioned, the plaintiff was a woman of considerable experience in business affairs, and capable of conducting and understanding business transactions, and able to protect her own interests, and at this time the defendant did not occupy, and had not been occupying any confidential relations towards the plaintiff.

It is contended by the counsel for the appellant that the court is in error in finding that the consideration agreed to be paid by the defendant for the conveyance was grossly inadequate. Certain witnesses testified that the property, at the time of the conveyance, was worth upwards of $14,000, and this estimate the learned court has adopted in fixing the actual valuation of the lands. This conclusion is controverted by the appellant’s counsel upon the ground that the conclusion of the witnesses was entirely speculative, for the same lands had been sold within a year of this transaction for a much less price. The defense in this particular relied upon is, that the premises had been sold within a year before this conveyance for a sum which would go to show that they were scarcely of greater value than the sum which the defendant had agreed to pay. But no witness is called by the defendant to testify that at that particular time the lands were not worth at least the sum of $14,000. For the fact was shown, and not controverted, that by reason of certain public improvements in and around Niagara Falls, lands adjacent and in that vicinity had greatly increased in value within a short time immediately preceding this transaction.

From the evidence, therefore, we conclude that the learned trial judge was correct in his conclusion, that there was a grossly inadequate consideration for the conveyance executed by the plaintiff to the defendant, and upon this ground, as well as for the reason that the plaintiff at the time of executing the agreement was not conscious of the act which she was doing, we think the deed was properly set aside. Taking the evidence as a whole, the learned judge could scarcely have come to a more satisfactory conclusion than he has reached in regard to the lack in the mental condition of the plaintiff at the time of executing the deed, and for several days previously thereto. A most extraordinary fact is made to appear upon this branch of the case and that is, that at no time antedating the deed was there any bargain or any negotiation for a transfer of this property by the plaintiff to the defendant. Had the defendant, by her own testimony or otherwise, shown that the deed was the result of a bargain for the sale and purchase made in the usual form, such fact would have gone far in vindicating the defendant from the charge of taking undue advantage of the physical and mental condition of her daughter to obtain from the latter all of her property, with a trifling exception, at a price not to exceed one-fourth of its real value. As was pointed out by the learned trial judge in his opinion, the business was conducted without any explanation of the transaction, and by means of direct questions or statements, the only answer to which was a nod or expressed assent of the plaintiff, and it can readily be seen from the manner in which this transaction was conducted that the witnesses to it had but slight opportunity to estimate or measure the mental condition of the plaintiff at the moment The testimony of Mr. McIntyre, which, evidently, was designed to help the defendant over the great stress of this part of the case, falls far short in its purpose. He testified to a conversation that he had with the plaintiff, which he fixes in the latter part of December, 1890, when she told him that, on account of her illness and the condition of her affairs generally, that she would like to adjust some of her matters, and had made an arrangement with Mrs. Lafflin to pay her indebtedness “ or some statement of that kind, and that she was owing me some money. She wanted me to arrange it so that my claim would be paid, settled, and wanted me to release the claim I had in this piece of property, a half interest.”

This evidence can scarcely be deemed to be any contradiction to the plaintiff’s case.

It follows that the judgment appealed from should be affirmed.

Judgment appealed from affirmed, with costs.

Dwight, P. J., and Lewis, J., concur.


text:
    Albertus Richards, Resp't, v. Cyrus D. Angell, App'lt.

      (Supreme Court, General Term, Fifth Department,

      Filed January 18, 1893.)

    Guaranty—Release—Construction of agreement.
    In an action upon three notes given for a balance due plaintiff from the estate of L. by defendant, as guarantor of the claim, the defense was settlement and discharge by an agreement entered into between the parties to the action. This agreement contained the provision that it " does not embrace claim that said R. may have against the estate of L. or against A. as guarantor of said claim.” It appeared from the testimony that the agreement was in regard to a litigation between the parties as to other claims and notes. Held, that the only fairly inferable fact to be derived from the agreement was that the parties intended to and did exempt the notes in suit from the operation thereof.
    Appeal by the defendant, Cyrus D. Angelí, from a judgment of the supreme court, entered in Chautauqua county, March 10, 1891, on the report of a referee.

      William H. Henderson, for app’lt;

      J. Q. Record, for resp’t.
   Macomber, J.

The complaint is upon three promissory notes of $500 each, executed by the defendant to the plaintiff’s order, each bearing date October 1, 1886, and payable respectively at three, six and nine months after date. The sole defense is payment or settlement. The defendant was liable as surety upon a certain indebtedness of the estate of Lucina A. Angelí, the wife of the defendant, in the sum of $1,938.71, as of February 6,1879, the date of the writing of the defendant’s guaranty. The notes were given for a balance due and unpaid from the estate of Lucina A. Angelí. The plaintiff, at the time of receiving these three notes, executed a paper to the defendant acknowledging the receipt of these notes, containing, among other things, the following clause: “ I hereby agree, if said notes are paid at maturity, that they shall be in full settlement of the above claim against the estate of L. A. Angelí.” Signed, “A. Richards.”

The defense is, that by an agreement executed March 6, 1890, between the plaintiff and the defendant, and through the fulfilment of the terms of that agreement by the defendant, the notes in suit were fully settled and discharged. But the last named agreement contained this provision also: “ This agreement does not embrace claim that said Richards may have against said executor of, etc., Mrs. L. A. Angelí, deceased, or claim against said Angelí as guarantor of said claim against said estate.”

Upon these reservations in the agreement of March 6,1890, and the testimony in support of it and in explanation of it, the learned referee has reached the conclusion that the notes in suit were not settled by that agreement. We think an examination of the whole of the testimony of the defendant himself fortifies the conclusion reached by the learned referee, for it admits that it was understood that the release should be so drawn as not to include any of the claims arising out of the estate of Lucina A. Angelí. There was at this time a litigation between these parties over certain notes and claims which the plaintiff had against the defendant; but such controversy did not pertain to these three notes which were given in payment and discharge of the indebtedness of the estate of Luciría A. Angelí to the plaintiff. The consideration of the notes was an actual indebtedness of the defendant as a guarantor of the claim made against the estate of his deceased wife, an obligation which he had assumed to pay on the 6th day of February, 1879. These notes represent the evidence of an indebtedness of the defendant as a guarantor of the plaintiff’s claim against the estate of Mrs. Angelí, and the only fairly inferable fact to be derived from the writing of March 6, 1890, is, that the parties intended to, and did in fact, exempt them from the operation of that contract.

It follows that the judgment appealed from should be affirmed.

Judgment appealed from affirmed.

Dwight, P. J., and Lewis, J., concur.


author: Barrett, J.

text:
    Moses K. Glines, Resp't, v. The Supreme Sitting Order of Iron Hall, App'lt.

      (Supreme Court, General Term, First Department,

      Filed December 16, 1892.)

    1. Corporations—Receiver—Service.
    Upon the hearing of a motion made to vacate an order appointing a temporary receiver of a foreign corporation, upon tile sole ground that the con it was without jurisdiction to grant it for the reason that no valid service had been made on the corporation, it appeared that the papers were served on the managing agent of the corporation, that none of its officers were within this state, and that it had failed to designate a person upon whom papers might be served. Held, that the motion was properly denied.
    3. Same.
    In such case it is not necessary for the affidavit of service to state how the affiant knew that the person served was the managing agent of the corporation.
    Appeal from order denying a motion to vacate an order appointing a receiver of defendant’s property within the state.

      Taylor L. Arms {Alfred Ely, of counsel), for app’lt;

      Morse, Koones & Findlay {Howard H. Morse and George Norris, of counsel), for resp’t.
   Barrett, J.

Upon the 26th day of August, 1892, an order was made at special term appointing a temporary receiver of the assets and property of the defendant within this state. A motion was subsequently made to vacate this order, upon the sole ground that the court was without jurisdiction to grant it, for the reason that the summons and complaint, together with the original order to show cause, had not been served upon the defendant according to law. The motion to vacate was denied upon the ground specified in the order of denial that the court had power to malee the order of August 26th, and to appoint a receiver of the property of the defendant, without notice to the defendant, and without first obtaining jurisdiction of the person of the corporation. It was unnecessary for the learned judge to specify in the order appealed from the ground upon which he denied the motion. It was sufficient that the motion was denied, and for good reasons. We need not consider the question as to whether the particular ground specified in the order was o£ itself sufficient to justify the denial of the motion; nor need we consider the argument on that head presented by the learned counsel upon this appeal. In saying this, we do not mean to intimate a doubt as to the correctness of the learned judge’s conclusion. It appears conclusively from the papers that the court bad jurisdiction of the defendant corporation at the time the order in question was made. That order was not made ex parte, but upon due notice to the defendant. The papers were served upon the managing agent of the defendant in this state, and it appeared that the defendant had no officer within this state upon whom those papers could have been served. It also appeared that the defendant had not made the designation of a person upon whom papers in an action might be served, as authorized by the second subdivision of § 482 of the Code of Civil Procedure. We think the affidavit of service which was before the court when the order appointing the receiver was made was itself quite sufficient.

It was not necessary for the affiant to state how he knew that the person named was the managing agent of the defendant, any more than it would have been, in case of service upon the president, treasurer, or secretary of the corporation, to disclose the affiant’s knowledge of the latter’s official position. Jurisdiction was certainly conferred by an affidavit stating that the service was made upon the managing agent, naming him as such. But, even if there were a defect of proof on that head, that was matter of evidence, not of fact, and did not go to the question of jurisdiction. We find, however, that the motion to vacate was resisted upon affidavits clearly furnishing ample evidence of the fact that the person upon whom the papers were served was the managing agent of the defendant. The question of 'jurisdiction did not depend upon the evidence as to the agency contained in the affidavit of service, but upon the fact that the person named was in truth the defendant’s managing agent. We also find that the motion to vacate was, as matter of fact, made without the authority of the defendant. The affidavits show that the only person who was really authorized to appear for the defendant was the attorney, Stewart, and he has interposed an answer, which completely concedes the jurisdiction. Ho question can be made upon this appeal with regard to the merits, or with regard to the equities of the complaint. The sole question is that of jurisdiction, and as it clearly appears that the plaintiff is a resident of this state, that the corporation has property within this state which this action seeks to preserve, and that the motion papers on the application for a receiver were duly served upon the corporation under the third subdivision of § 432 of the Code, we think the court had jurisdiction, and that the order denying the motion to vacate the order appointing the receiver should be affirmed, with costs.

Order accordingly affirmed, with costs.

Van Brunt, P. J., concurs. ■


author: Van Brunt, P. J. O’Brien, J.

text:
    Warren S. Sillcocks, Pl'ff, v. Peter W. Gallaudet et al., Def'ts.

      (Supreme Court, General Term, First Department,

      Filed December 16, 1892.)

    1. Stocks—Insolvency of broker—Liens.
    The fact that a person is able to trace stock purchased for him on margin by insolvent stockbrokers, or its proceeds, does not entitle him to a lien on the assets of the insolvent firm superior to other customers who dealt with them in a like manner.
    2. Same.
    But a person depositing with such brokers stocks as a margin for the purchase of other stock is entitled, so far as he can trace the stocks so deposited and their proceeds, to a superior equity over other creditors whose stocks were purchased on a margin.
    (O’Brien, J., dissents.)
    Appeals by both parties from judgment entered upon report of a referee in action to recover stock from the general assignees of a firm of brokers.

      Russell & Percy ( W. A. Poste, of counsel), for pl’ff;

      Wingate & Oullen, for assignee.
   Van Brunt, P. J.

Prior to November, 1890, the defendants, Gallaudet & Pitch, were partners doing business as stock brokers, in the city of New York. In July, 1890, the plaintiff employed the said defendants to purchase for him 200 shares of the capital stock of the New York. Ontario & Western Railway Company, and left with them, as security for the purchase price, 100 shares of the same stock, represented by a certificate thereof numbered 27,988, which order the defendants, Gallaudet & Pitch, executed. In August, 1890, the plaintiff employed the same firm to buy for him 100 shares of Quicksilver mining stock, which they did. In October they bought for the plaintiff 100 shares New York & New England Railroad Company stock, and subsequently the plaintiff deposited with them at their request, as additional margin, 100 shares of New York, Ontario & Western Railway stock, represented by certificate No. 27,987. Subsequently said firm sold for the plaintiff fifty shares of American Tobacco Company stock, and received the cash therefor. Gallaudet & Pitch never delivered to the plaintiff any qf the shares so purchased, nor the proceeds thereof, nor returned' to him the certificates deposited by him. In making the purchases for the plaintiff, they advanced for the payment thereof, $4,175, and the same remained unpaid to them at the time of their assignment. It appears that at the time of their assignment the brokers themselves owned no stocks, all that they held belonging to customers, for whom they were carrying them upon margin. All the stocks were hypothecated upon various loans, and, on closing out these loans in' a few cases, a balance of money was delivered to the assignee, but in most cases there was a deficiency. The plaintiff claims that he has been able to trace certain stocks which were pledged as margins as having been bought for him, andthat, therefore, he is entitled to a superior equity over and above other creditors who have not been able to identify any particular stocks as, having been purchased for them. This contention we do not think can prevail. These stocks were purchasedPupon margin, precisely the same as the stocks of other customers, and the same course was pursued with them as with the plaintiff’s stocks ; and, therefore, there would appear to be no foundation for the plaintiff’s claim to impress a superior lien upon any of the assets of the firm, because of the disposition of these securities, from that of all the other creditors who were dealing with the stock brokers upon the same basis; and it is for this reason that it has not been deemed necessary to state in the foregoing summary of the facts the particulars in reference to the claims which have been made in respect to the stocks bought.

We think, however, that the plaintiff’s claims in respect to the stocks deposited as margin, belonging to himself, stand upon a somewhat different basis, and that, so far as he is able to trace those stocks and their proceeds, he is entitled to a superior equity over the other creditors whose stocks were purchased upon a margin. There seems to be no reason in equity why such a preference should not be given to property belonging absolutely to the plaintiff, and which the defendant firm only held 'as security for the advances which they might make in the execution of the orders given by the plaintiff, there being none others similarly situated. And this brings us to a consideration of the case in respect to the two certificates numbered 27,988 and 27,987.

It appears that prior to the assignment the said firm hypothecated to the Bank of Commerce, with other securities, as collateral against a loan to them from the bank, said certificate No.' 27,-988, and also a certificate of the same stock No. 26,989, hereinafter mentioned. The bank, on default of payment, sold out a part of the securities so pledged, including said certificate No. 27,988. The sale made a surplus over the amount due to the bank of $1,483.84. The certificate in question sold for $1,600. The stock which was so hypothecated that was not sold was returned by the bank to the assignee, who, after surrendering eight shares of American Cable Company stock to a claimant, sold the rest for $16,743.12. This certificate was directly traced as above stated, and, pursuant to the principles which have been heretofore enunciated, it would seem that the plaintiff, instead of being entitled to have impressed upon the surplus arising from such sale a trust limited in its character, has a superior equity, and, in case no sale had been made, would have been entitled to have insisted upon the sale of the other securities first, so that he might receive his securities intact, and that this right ought to follow the proceeds of the securities pledged.

In respect to certificate No. 27,987, it appears that that was sold on the 13th o£ November, 1890, without the direction or knowledge of the plaintiff; and it is claimed that because at that time the said firm had in their hands another certificate, No. 26,939, for the same number of shares, the plaintiff became the equitable owner of such certificate, and that it must be assumed that the firm had reserved and set it aside for him as a matter of fact, and that he was entitled to follow it when it was put up as a collateral to the Bank of Commerce loan. This, we think, is a violent assumption, as there is no evidence whatever, except the existence of this certificate, which would justify the same ; and this single fact is manifestly insufficient. It seems to be based upon the claim that, by the mere pledge of the stock which the firm had bought for the plaintiff upon margin, they converted the same to their own use, a proposition which we neither admit nor deny, because it does not seem to be necessary for the disposition of the questions involved in the case at bar. We are of opinion, therefore, that the plaintiff was entitled to additional relief to that which was given by the referee, and a new trial must be had. It is consequently unnecessary to discuss the question raised by the appeal of the defendant assignee as to his liability for costs. The judgment must be reversed, and a new trial ordered, with costs to the appellant plaintiff to abide the event.

Lawrence, J., concurs.

O’Brien, J.

(dissenting).—I dissent for the reason that I think the judgment of the referee correct, both in the extent of the relief granted to plaintiff and in awarding him costs. As to the 100 shares of Hew York, Ontario & Western represented by certificate Ho. 27,988, I agree with the presiding justice in the view (being plaintiff’s property, and directly traced to the bank) that, in case no sale had been made, he would have been entitled to have insisted upon the sale of the other securities first; but other parties, similarly situated, and upon a like showing, would have a like equity and a like right. Where, therefore, securities which belong to third persons are pledged by the insolvents as collateral for a loan, all have an equal right to have other securities sold first. But the plaintiff here, as against owners of identified stock so pledged, lias no superior right or equity. Such superior equity only holds good as against general creditors, or persons not establishing title to the identical securities pledged. It here appears that among the other securities so pledged to the bank were some where the persons make a similar claim to that presented by plaintiff. All these securities, as well as plaintiff’s, were sold; and the contest is as to their respective rights in the surplus. I think the referee correctly states the rule that, while plaintiff is entitled to follow his certificate of stock as far as it can be traced, “ even his diligence in prosecuting his claim cannot avail to give him prior equities over other creditors of the insolvent firm similarly situated with himself; * * "x" that they were all entitled to be heard, and have their rights determined, either in this action or upon the final accounting ” of the assignee. Upon the question of costs, the referee, in the exercise of his discretion, awarded them to plaintiff. As affecting such discretion, the judgment is more favorable than was conceded by defendants before action. I find no valid ground presented for interfering with the discretion so exercised by the referee, and I, therefore, think the judgment should be affirmed.

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


author: O’Brien, J.

text:
    Jacob Schmidberger, App'lt, v. John Bloner et al., Resp'ts.

      (Supreme Court, General Term, First Department,

      Filed December 16, 1892.)

    Forcible entry and detainer.
    Upon the trial of an action to recover damages for forcible entry and detainer, it appeared that the premises in question belonged to one of the defendants, from whom plaintiff had leased, and that while defendants were on the premises engaged in constructing, at plaintiff’s request, a house for him, an altercation occurred, followed by an assault on plaintiff, which drove him from the premises. No testimony was offered to show that defendants prevented plaintiff from regaining possession or that they retained the same. Held, that the complaint was properly dismissed.
    Appeal from a j udgment entered upon an order dismissing the complaint in an action of forcible entry and detainer.

      Leopold Leo, for app’lt;

      H. G. Henderson, for resp’ts.
   O’Brien, J.

This action was brought to recover damages from the defendants for alleged forcible entry and detainer. Upon the trial it appeared that the plaintiff had hired from one of the defendants, and entered into possession of, a plot of land in Westchester, which he utilized in raising “ garden truck.” It further appeared that on July 29, 1890, the defendants, who were upon the land by permission of the plaintiff, constructing for him a house, engaged with him in a quarrel concerning money paid for some potatoes which had been raised upon the premises, and sold to a grocer. The money, which, it is claimed, the defendants so received, the plaintiff demanded of them, which they refused to give. To quote the plaintiff’s language, he then said:

“ The place belongs to me, and to-morrow morning nobody can come into my gate again. Neither groceryman nor you can come into my gate to-morrow morning, not if I have to stand there with a pitchfork to guard my potatoes.”

Plaintiff further testified that thereupon—

“ They came down from this house; they ran after me, and picked up stones, and I knocked back two stones with a pitchfork ; and I saw they were coming too close with me, with great big stones in their hands, and threw stones at me, and I went out of the gate, and they acted like wild men ; they said, ‘ Kill the dog; ’ they said, 1 He is no good, anyhow; ’ I went inside of my house; I went into the house that I had rented; it was about two hundred yards away from the place where I had rented rooms, and I went into those rooms; I have never returned to this farm.” Besides the plaintiff, two other witnesses were examined; one his wife, who, in addition to stating that her husband had correctly given what had occurred between himself and the defendants, testified that the defendants said:

“ ‘ If he comes in again in the place, there will be murder, and he shall never come in again; ’ and then I told my husband never to come in again.”

The other witness was the father of Mrs. Schmidberger, the last witness, who testified to a conversation which he had with John Bloner, one of the defendants, and his wife, in their house. He stated that they told him that the plaintiff and his wife should not go hack to that place, otherwise there would be murder ; and this the witness was directed to state to the plaintiff. It does not appear, however, that he communicated this to the plaintiff, and the conversation itself appears to have occurred after the plaintiff had abandoned the place as the result of the quarrel which has been detailed.

We think that the statement we have given of the principal facts testified to, upon which the plaintiff relied to support the action, will demonstrate that it was insufficient, and that the disposition made by the trial judge in dismissing the complaint was correct, because, in the first place, there was no forcible entry by the defendants, they having gone there, at the invitation and by the permission of the plaintiff, to assist him in constructing a house; and all the testimony as to what occurred shows that there was a quarrel, resulting in bad blood, and the threatened killing of the plaintiff with stones, which, in the heat of the quarrel, the defendants had taken up from the ground, and with which they had driven the plaintiff off the premises. After this the plaintiff did not return to the premises, and, so far as the testimony would show, neither did the defendants. With the exception of one little piece of testimony on the part of the wife, who states that she saw the wagons of the defendants go upon the land at some time after the quarrel, the case is entirely barren of any evidence to show that the defendants thereafter ever went upon the premises, and, on the occasions referred to by her, it may have been for the purpose of completing the house which was then in course of erection, or for some other lawful purpose; and, in the absence of testimony showing that the plaintiff had denied the right to the defendants of entering upon the land, this cannot be construed into a forcible detainer. It will thus be seen that the elements of trespass and holding possession by force, which are essential attributes of an action for forcible entry and detainer, are wanting. As already stated, neither of these were shown upon the trial. The original entry was lawful; and, in the absence of testimony showing that the defendants by force prevented the plaintiff from regaining possession of the land, a recovery for forcible entry and detainer could not be sustained. The most that was shown was an altercation, followed by an assault by the defendants upon the plaintiff, which resulted in driving him, for the time being, from the land. But this testimony was not sufficient to go to the jury, nor would it have sustained a recovery upon the ground assigned as the cause of action.

We are of opinion, therefore, that the judgment appealed from should be affirmed, with costs.

Van Brunt, P. J., and Barrett, J., concur.