text:
    Eliza A. Martin, Appellant, v. Charles B. Peet and Others, Respondents.

      Contract — -evidence that a promise was made for the benefit of a third person— failure to use the words “pay ”or “ liquidate” • — -promisor not liable to a third, party.

    In order to establish a liability, against a party making a contract, to a third party not named therein, there must be a clear intention evinced to give a right of action to such third party.
    In an action brought to charge the defendants with a liability growing out of a policy of insurance on the ground that they had assumed payment of the debts of the insurer, it appeared that the plaintiff was a beneficiary under a policy of life insurance issued by tbe Equitable Accident Association, under the by-laws of which a member was entitled to receive such sum as might be realized from a single assessment levied upon the persons who were members of the association at the time when the accident happened, not exceeding the sum specified in the certificate of membership; that the insured sustained an accidental injury from which he died on May 10, 1889, and that on November 19, 1892, the plaintiff recovered a judgment upon the policy against the association which proved to be uncollectible; that on November 1. 1889, certain persons who, as the complaint alleged, were most largely interested in the management of the Equitable Accident Association, entered into a written contract with persons alleged to be interested in the United States Mutual Accident Association, by which such latter persons agreed that they or the United States Mutual Accident Association would reinsure the risks of the former company and take its business, the agreement containing a covenant upon the part of such latter parties that they (the parties of the first part thereto) would “indemnify and save harmless the said second parties and all other officers and directors of said association from any and all liability in connection with said association, except indebtedness of the said association to officers and directors. It is further agreed by said first parties that they will settle and adjust all liabilities of said association, and save said second parties harmless from any actions which may be brought wholly or in part by reason thereof, and that the parties of the second part will retain their positions respectively and act therein under the direction and control of the parties of the first part until such time as the affairs of the Equitable Accident Association can be wound up.” The agreement in question nowhere contained a promise to “pay” or “liquidate” the debts of the Equifable Accident Association.
    Upon the trial of the action evidence was given tending to show that the Equitable Accident Association had not been legally wound up and that the persons alleged to be most largely interested in its management had no interest, rights or privileges in it other than to a portion of the salary which rvent to the secretary. The answer denied that any assessment had ever been levied to pay the plaintiff’s claim, and there was no proof that, at the time when the defendants made the promise in question, the parties of the second part, representing the Equitable Accident Association, were personally liable to the plaintiff for the amount of her claim against it.
    Held, that the language of the agreement did not make the defendants liable for the plaintiif’s claim;
    That the agreement made by the defendants was one of indemnity, and was not intended as a contract to pay the claim of the plaintiff or that of any other person similarly situated.
    Appeal by the plaintiff, Eliza A. Martin, from a judgment of the Supreme Court in favor of tlie defendants, entered in the office of the clerk of the count}' of Broome on the 2d day of April, 1895, upon a nonsuit granted after a trial at the Broome Circuit before the court and a jury, as such judgment was amended by an order entered in said clerk’s office on the 27th day of April, 1895, and also from an order entered in said, clerk’s office on the 25th day .of February, 1895, denying the plaintiff’s motion for a neiv trial made upon the minutes.
    This action was brought to charge the defendants with a liability growing out of a policy of insurance, on the ground that, by the terms of a written contract entered int) between them and the insurer, they had assumed payment of the debts of the insurer.

      Garver, Deyo & Jenkins, for the appellant.

      George F. Lyon, for the respondents.
   Hardin, P. J.:

Plaintiff’s complaint alleges that November 1, 1889, and for several years prior thereto, the Equitable Accident Association of Binghamton ivas a corporation organized under the laws of the State of New7 York engaged in an accident insurance business, and that during said.time George W. Dunn and Frederick E. Iioss were directors and James B. Arnold was secretary and manager, and David Murray was attorney for the association, “ and that they w7ere the persons most largely interested in the conduct and management of the business of said association, financially and otherwise.” The complaint alleges that on the 23d day of November, 1883, William A. Martin, then the husband of this plaintiff, became a .member of the Equitable Accident Association of Binghamton and received a 'policy of insurance in which the association “ undertook and agreed, among other things, to pay to this plaintiff, wife of said assured, the sum realized upon an assessment made in accordance with the provisions of its by-laws, not exceeding $5,000, within sixty days after the filing with the said association due proof that said William A. Martin had sustained bodily injuries, effected through external, violent and accidental means, which injuries alone occasioned his death within ninety days from the happening thereof.” The complaint further alleged that William A. Martin, on the 27th of April, 1889, while the policy was in force, sustained an accidental injury from which he died on or about May 10, 1889, and that the sum realized upon an assessment made in accordance with the provisions of said policy and by-laws at the time' of said accident far exceeded the sum of $5,000.” It was alleged that the claim under said policy became due and payable about July 25, 1889, and that the same was not paid, and that the plaintiff, July 30, 1889, commenced an action against the association on the policy, and that a defense was interposed by the association, and the action was for a long time contested “ under the charge or direction of the above-named defendants; ” that a trial was had at the Broome Circuit November, 1892, and a verdict rendered for the plaintiff, and a judgment entered thereon in favor of the plaintiff against the association on the 19th of November, 1892, for the sum of $6,166.70, and that an execution was issued on the judgment to the sheriff of Broome on the 13th of March, 1893, and returned wholly unsatisfied prior to the commencement of this action. The plaintiff further alleges that at the times hereinbefore mentioned the United States Mutual Accident Association of the city of New York was a corporation organized under the laws of the State and engaged in carrying on an accident insurance business. “ That the said Charles B. Peet was the president, said James R. Pitcher was the secretary and general manager of, and the said William Bro Smith was the attorney for said association, and that they were the persons principally interested in the conduct and management of said association, financially and otherwise.” The complaint alleges that on the 1st of November, 1889, the defendants Peet, Pitcher and Smith “ made an arrangement and entered into a contract with ” Dunn, Ross, Arnold and Murray, claiming to represent the Equitable Accident Association, “ by which it was, among other things, agreed that said Dunn, Ross, Arnold and Murray would transfer, attempt to transfer or cause to be transferred to said defendants the membership or risks of the said Equitable Accident Association, the same to be reinsured by said defendants or in said United States Mutual Accident Association, and that said Equitable Accident Association should discontinue its business, and that they * * would assign, transfer and set over to said defendants any and all interest, contract rights and privileges’ which they or either of them had in or to the business and management of the said Equitable Accident Association ; that in consideration of said transfer of said membership and said other interests, ,and of said discontinuance of said insurance business, and for other good and valuable considerations, the said defendants, on their part, undertook and agreed that they would settle, adjust and pay all liability and demands against said Equitable Accident Association.” Plaintiff then alleges that her claim was one of the liabilities of the said Equitable Accident Association “ which said defendants undertook and igreed to settle and pay as aforesaid; that payment of the same was only demanded of said defendants prior to the commencement of this action.”

The defendants in their answer deny many of the allegations of the complaint, and they admit the execution of an agreement on November 1, 1889, with Dunn, Ross, Arnold and Murray, and they allege that the Equitable Accident Association Avas a mutual binefit association, and that its by-laAvs, as Avell as each certificate, prodded that any person claiming thereunder should, in the event of liaiflitybe entitled to “receive only such sums as might be realized upoi a single assessment upon the members of said association at the tine of the happening of the aeoiclent, made in accordance with the oroA-isions of said certificate and by-laAvs, not exceeding the sum sp&ified in such certificate, and that no such assessment lias been made by said Equitable- Accident Association for the payment of saidalleged certificate, or proceeding taken or even demand made tlieefor.”

Upon the trial widence Avas given to the effect that the Equitable Accident A-^ociation “has not been legally Avound up. The directors and fiicers stand the same hoav as Avhen the association discontinued msiness.” Plaintiff offered in evidence the judgment roll in thecase of Eliza A. Martin against the Equitable Accident Associ%n of Binghamton, Avliich AAras filed in the Broome county clerk’s.(fice November 18, 1892, and an execution issued on that judgment \nd its return unsatisfied. Evidence Avas given to the effect that lunu, Ross, Arnold and Murray had no “ interest, rights or priviUes ” other than a portion of the salary which Avent to the secretar)

Plaintiff rests her right to.ecov-er against the defendants in this action upon the language o. the agreement of the 1st day of November, 1889, executed by the defendants, as parties of the first part, with Dunn and his associates as parties of the second part. That agreement enumerates certain debts and liabilities which the defendants undertook to discharge, and contained a provision to “ indemnify and save harmless all and singular the said parties of the second part from any and all damages, costs and expenses of every kind, arising by reason of the said parties of the second part having become sureties on the said undertakings on said appeal from said judgments.” Then follows the language which the pl-iiutiff relies upon and rest the claim made by the plaintiff against the ■ defendants. The language found in the agreement is as fellows : It is further agreed by said first parties that they will indemnify and save harmless the said second parties and all other offeers and directors of said association from any and all liability in connection with said association, except indebtedness of the said association to officers and directors. It is further agreed by said first parties that they will settle and adjust all liabilities of said associating and save said second parties harmless from any actions which m¡y be brought wholly or in part by reason thereof, and that the pajiles of second part will retain their positions respectively and ac! therein under direction and control of parties of the first part untilsuch time as the affairs of the Equitable Accident Association can he wound up.” .It is to be observed that the language quoted doepnot use the word Pay ” or liquidate.” It is contended, howevi', that the words “will settle and adjust all liabilities of said association, and save said second parties harmless from any actions wli°h may bo brought wholly or in part by reason thereof,” are equivalent to a promise on the part of the defendants to pay the debts ¿ the association, and especially the claim held by the plaintiff. It is now well settled that, in order to establish a liability agaiusta party making a contract to a third party not named therein, tK° must be a clear intention evinced to give a right of action to s°h third party.

In Beveridge v. N. Y. E. R. Co. (11 N. Y. 1, 26) Gray, J., in writing the opinion, says : “Within tlupi'hiciples of adjudged cases in this court, where the plaintiff seeks0 l)ase his right to maintain his actioii against a third party upon contract made between that party and another, it must be one lW0 or intended for his benefit. Such a beneficial intent must be icarly found in the agreement. * * -x- ju an of the cases which I have examined, where the-action was sustained, the facts showed that the promise clearly was. for the third person’s benefit, and made with that distinct intention.” After a careful study of the agreement now brought in judgment,, we are of the opinion that the requirements of the rule are not. answered by the agreement before us. After considering the agreement in the light of the surrounding circumstances, we are of the opinion that the agreement made by the defendants was one of indemnity and not a contract to pay the claim of the plaintiff or of any other parties similarly situated. (10 Am. & Eng. Ency. of Law, 402, § 1; Feist v. Schiffer, 79 Hun, 275.)

Appellant calls our attention to Brown v. Curran (14 Hun, 260).. The language of the contract under construction there, was much broader than the language found in the contract before us. The-co-partnership had existed fold its interests were inventoried and sold to the defendant for $6,000, who agreed “ to settle, satisfy and pay all debts against the said firm of L. Richards & Co. mentioned in a certain schedule.” In that case it ivas very clear that the-promise was niade for the benefit of the third person who sought to recover one of the debts mentioned in the schedule. We think the case is quite unlike the one now in hand and does not aid the contention of the appellant.

Appellant calls our attention to Butts v. Wood (37 N. Y. 317). That was an action brought by a stockholder in his own behalf and in behalf of the other stockholders against certain trustees for an alleged fraud and to recover damages sustained by the plaintiff by reason thereof. In the case before us, there are no averments in the complaint of fraud or fraudulent practices on the part of the defendants in this action, and the doctrine of the case stated lias no application to the case in hand.

Our attention is invited to Riordan v. First Presbyterian Church (6 Misc. Rep. 84). In that case the language in the agreement was will pay and discharge any and all charges and expenses for medical attendance and advice,” etc. And upon the evidence in that case it was very clearly made to appear that the promise was made-for the benefit of the plaintiff, and it fell within the doctrine of Garnsey v. Rogers (47 N. Y. 233) and Beveridge v. N. Y. E. R. Co. (112 id. 26).

In tlie case in hand there is no proof sufficient to indicate that, at the time the contract was made by the defendants, Dunn, Ross, Murray and Arnold were, or any one of them was, personally liable to the plaintiff for the amount of her claim against the association. (Carrier v. United Paper Company, 73 Hun, 287; Durnherr v. Rau, 135 N. Y. 219; Binghamton Savings Bank v. Binghamton Trust Co., 85 Hun, 75, 80; S. C., 32 N. Y. Supp. 657, 660.)

The foregoing views lead to the conclusion that the nonsuit was properly granted.

The judgment and order must be affirmed, with costs.

Martin and Merwin, JJ., concurred.

Judgment and order affirmed, with costs.


source: Caselaw Access Project

author: Hardin, R. J. :

license: Public Domain

text:
    Henry A. Sias and Ida A. Baun, as Administrators, etc., of Charles H. McKee, Deceased, Appellants, v. Rochester Railroad Company, Respondent.

      injuries —passenger unnecessarily standing on the platform and, leaning °V6r ^W S^6 a mr— Huesi,ions Pf negligence for the jury — death later than a Hear and a day after tile accident.

    In an action brought to recover damages caused by the alleged negligence of the defendant, a street railway corporation, it appeared that the'plaintiffs’ intestate was riding in a car upon the defendant’s road about ten o’clock at night, and that although the car was not full and the night was dark, he, of his own motion, went out upon the front platform of tlie car to look about, the conductor, who was then upon the front platform, apparently offering no objection to the presence of the intestate, who, after having been upon the platform a minute or more, leaned over beyond the side of the car and was struck by a tree near the line, causing injuries from which he died more than two years later. It appeared that the tree in question came within five or six inches of the car, and that part of its body had been cut away to allow cars to pass.
    Upon an appeal from a nonsuit directed by the court,

      Held, that the questions of negligence and contributory negligence should have been submitted to the jury. Hardin, P. J., dissenting.

      It seems, that the fact that the injured person died more than a year and a day after the accident occurred would not prevent a recovery.
    Appeal by tlie plaintiffs, Ilenry II. Sias and another, as administrators, etc., of Charles II. McKee, deceased, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Jefferson on the 14th day of June* 1895, upon a nonsuit granted by the court after a trial at the Jefferson Circuit before the court and a jury, and also from an order bearing date the 9th day of May, 1895, and entered in said clerk’s office, denying the plaintiffs’ motion for a new trial made upon the minutes.
    The complaint alleges that the defendant maintains and operates an electric street railway on Lake avenue and elsewhere in the city of Rochester, for the conveyance of passengers for hire: and that on the 4th of September, 1892, the plaintiffs’ intestate boarded one of the defendant’s cars near Ontario Beach about ten o’clock p. m., and jiaid to the conductor of said car the fifteen cents fare for carrying the plaintiffs’ intestate from Ontario Beach over defendant’s railway to the Whitcomb House in the city of Rochester; that while the intestate was being so carried as a passenger, “ and while standing on the platform of said car, with the knowledge and consent of the defendant and of the conductor of said car, he was struck on the head by a tree standing adjacent to the railroad track of the defendant and thrown upon the ground, stunned and rendered senseless until the following day, and suffered severe injuries from such blow and fall, chiefly to his head; ” and that the injuries thus incurred were so severe as to cause intestate’s insanity and his death, which ensued on the 14th day of December, 1894. It was claimed in behalf of the plaintiffs that it was for the jury to determine whether the injuries occurred from the wrongful act of the defendant, although death ensued more than one year and a day after the injuries were inflicted. (See Schlichting v. Wintgen, 25 Hun, 626.)

      Mxdlin, Griffin c& Walker and D. G. Griffin, for the appellants.

      Bacon, Briggs, Beckley dé Bissell and Marsenus 3. Briggs, for the respondent.
   Hardin, R. J. :

After the intestate had purchased a ticket and entered the car of the defendant, it was in duty bound to observe care in his transportation from Ontario Beach to the city of Rochester.

In Clark v. Eighth Avenue Railroad Company (36 N. Y. 137), Grover, J., said: “ Tlie law requires from those so engage^ the exercise of such care on their part, and of their servants, as will insure the safe carriage of their passengers so far as their safety depends upon the diligence and care of those engaged in such.carriage, and makes them responsible for any injury sustained from the omission of such care and diligence.”

The witness Bamber testifies that he took & seat about the middle of the car on the right-hand side, and he adds: “ Four fellows together on the otller side laughing, talking, having a good time; pretty soon a cohple of them got up, walked up front of the car; as soon as they had passed out of the door I didn’t see any more of them; and just about a second, or minute or two, I heard thud and knew some one had been hit then by the side of the car, up against a tree was there; I jumped up, dropped off the rear end of the car, went back, saw him lying down, went and rung Dr. Sibley’s door bell; * * * This accident occurred on Lake avenue in front, not quite in front, of the doctor’s house; * * * the car was an open trailer, what they call an open side; * * * when I ■saw these two men stand up and go out on the platform of the trailer I observed the conductor standing on the platform; I could see him through the open door; these men went out on the front platform of the rear car of the train; the conductor ivas on that platform when they went out; the car was not jammed full; there wore five or six single seats; * * * these two men passed out throughout the door on to the platform; the conductor stood there ; I was sitting on the fifth seat back from the front of the car.” This witness testified that he had seen the big tree before, and he added that “ about eight feet from the ground there is a kind of place notched out so the eaves of the car could slip by; I should judge it was cut out so as to let the car pass, so as to let the edge of the roof slip by; the roof extended out over the lower part of the car about three inches; * * * I should judge the tree came somewheres between four and six inches from the car; * * * this tree, which was notched, was about a foot and a half through; It was an elm tree.”

The witness Plant, who was riding on the car in question at the time the deceased was hurt, testified, viz.: “Noticed there was a party of three or four on the same -car, seeming to be together, opposite me, and noticed they were having a good time; one oi them got up and walked to the front end of the platform, and 1 didn’t pay any more attention to him ; the next tiling I heard was a rap on the side of the car and the bell rang and the car stopped, and I got off and some of the men there picked him up and brought him into 'the doctor’s office; from the time T saw the- man go forward on to the platform until I heard the rap on the car was not very long; it was a minute and a half or two minutes; * * •* when I saw the man go forward on to the ¡platform I observed the conductor at the time was standing on the platform, on to which McKee went; I didn’t see the conductor speak to him or make any sign to him, nor hear anything said by any body on the front platform ; * * * the noise I heard, which made me think the man got hit, was like any body bumping their head on a table; that noise was something striking against the side of the car; when I saw the conductor he was standing on the front platform.”

The witness Leach testified that he was one of the four who was riding with McKee, and he added: “ All I observed of the accident was the noise just before the accident; it seems there was a fire on the right, and Mr. McKee said that he was going out to see where it was; he got up and started out alone, and was struck, as I suppose, by a tree as he passed on to the platform; he turned to the right, and I saw the conductor standing there on the platform on to which McKee went. * * * When 1 last saw him his body was in a stooped position just bending out off the platform ; that is all I could see; I heard a noise, heard him strike against the side of the car; then the car stopped. * * * I think there was a little space of time between the time he passed around the door and went out and when the accident happened, a little space before the accident ; I could not tell accurately whether it was a minute or half a minute or two minutes.”

The witness Revell testified that he Avas returning on the same car with the deceased; and he adds: “I sat in the seat opposite McKee Avitli Mr. Leach ; I think I sat next to the outside of the car ; am not very positive about that. McKee and Ash Avlxen they first went aboard sat facing Rochester; before AAre reached the place of the accident they reversed the back of the seat and sat down, > and McKee was then facing me; that was a short time before the accident, and I sat there but a little while ; just before McKee got up I heard somebody say there was a fire over there; * * * as soon as the remark was made about the fire, McKee got up; he said he was going out to see what it was; I don’t think anybody went out on the platform with him.” This witness adds: “ The car was not full this night;-there was plenty of room inside; in other words, the deceased did not go out on the platform to ride ; it is my idea he went out there to look at the fire.”

The witness Ash described what he observed in the course of the trip, and says: “ When the accident occurred I was seated in the car, having gone in before McKee went out; * * * I saw McKee when he got up and went out on the platform; I didn’t notice the conductor when he went out; the conductor was standing there when I came in, and McKee went out directly, when I came in and sat down; I felt the jar of the car when McKee was caught between the tree and car; he had just about time to get up and go out on the platform and step down there, just about time to walk out and be struck; step down' on the platform of the car, perhaps half a minute or so; I don’t know exactly how long he was on the platform; it occurred directly after he went out; I don’t know how long a period intervened between his going out on to the platform and his getting hit; I just sat down as he went out on to the platform ; he went out directly after I sat down ; * * * next morning I observed there was a notch cut in the tree, suppose for the eaves of the car to run through.”

The witness Burns testified that he “ took a measurement from the outside of the rail to the nearest margin of the base of the tree in question; found it was a foot and seven inches; the body of the tree then receded a little, the base being about an inch and a half nearer the rail. From a point about four and a half feet from the ground to about eight feet above the ground the side of the tree towards the track was hewed out; at about seven feet and a half from the ground it was hewed out more than at any other point; I noticed the tree inclined towards the track; I made measurements from the side of the car above the screens to the side of the tree and found it was between four and five inches at all points from the point four and a half feet to the point eight feet above the ground; that was the distance from the tree to the side of the car above the screens on the car, which I should say were about an inch and a half from the side or standards of the car; I. afterwards visited the premises, and the tree at that time was cut down.”

From the foregoing facts it is manifest that the intestate, by leaving his seat and going upon the platform and putting his head beyond the standard or side of the car, received the injuries which are complained of in this action. It is contended in behalf of the defendant that the deceased’s negligence in leaving his seat and going upon the platform when there was plenty of room in the ear and no necessitious occasion to leave his seat contributed to the injuries, and, therefore, that a recovery cannot be had. On the contrary, the plaintiffs contend that the deceased is not chargeable with contributory negligence as a matter of law in standing on the platform and protruding his head outside the line of the car.

The appellants call our attention to Nolan, v. B. C. & N. R. R. Co. (87 N. Y. 63). In that case it appeared that the party receiving the injuries was expressly permitted to ride on the front platform) as the conductor received his fare there, and there was proof that it was customary for the company to require passengers who were smoking to ride on the platform. The facts of that case differ-from the one before us.

Our attention is also called by the appellants to Goodrich v. Penn. & N. Y. C. & R. R. Co. (29 Hun, 50). In that case the passenger left his seat and went upon the platform of the car and stood there until the accident in question occurred. There is no evidence in that case that he put his head beyond the line of the car, and Judge Haight in his opinion reviews the authorities relating to the question, and upon the precise state of facts there disclosed reached the conclusion “ that it was a question for the jury whether or not. it was negligence for him to stand upon the platform under such circumstances.” We think the circumstances in this case are different from that case, and, therefore, that it is not a controlling authority in favor of the plaintiffs.

Our attention is called to Werle v. L. I. R. R. Co. (98 N. Y. 650). In that case the passenger failed to find a seat, and none was-pointed out to him by an employee of the company, and he took a. position on the platform of the car where other passengers were riding and without any objection from the employees, and was thrown from the car by a sudden lurch given by the great and increased speed in which the train was run on turning a curve, and •on that state of facts it was held that a question of fact was presented for the consideration of the jury. We think the case essentially differs from the one before us.

Our attention- is called to Ginna v. Second Ave. R. R. Co. (67 N. Y. 596). In that case the car was crowded, and the conductor ■consented to the passenger standing upon the platform by accepting from him the usual fare without insisting on his finding a place within the car, and while he was thus riding upon the platform he was thrown off and injured by the negligence of the company, and under those circumstances the court determined that the f'act that he was standing upon the platform did not of itself constitute contributory negligence, but that it was a question for the jury. The facts of that case differ from the one before us.

• Appellants call our attention to Willis v. L. I. R. R. Co. (34 N. Y. 670). In that case the passenger was standing upon the platform of the cars in motion when there were no vacant seats within the cars. He was obliged to put his baggage on the car and the ’■train started immediately and he paid the conductor for a seat, but found, on examination, that all the seats were occupied, and he was ■compelled to stand, and the speed of the train was such as to render it hazardous to pass from car to car. We think the facts of that -case differ essentially from those disclosed by the evidence in the ^case in hand.

Our attention is invited to Francis v. N. Y. Steam Co. (114 N. Y. 380). In that case the plaintiff was a passenger upon a railroad; he was sitting by an open window of a car and had his arm broken ■as the car passed a bridge. It was claimed by the defendant that the injury was caused by the plaintiff’s arm extending so far out of the window that it came in contact with the upright which supported a hand rail on the bridge. However, the testimony was conflicting upon that subject, and the question of whether the plaintiff was guilty of contributory negligence under all the circumstances •disclosed in that case was held to be one properly submitted to the jury. We think the case differs in its facts from the one before us.

Appellants cite Webster v. R., W. & O. R. R. Co. (40 Hun, 161), where a passenger received injuries who was in a baggage car smoking sitting on a trunk, with the knowledge and consent of the conductor, and it was held under all the circumstances of that case “ that the question of contributory negligence was one properly submitted to the jury.” The facts of the case differ so essentially from the facts in the case in hand that -we think it is not an authority controlling in favor of the appellants.

Our attention is invited to Vail v. Broadway Ry. Co. (6 Misc. Rep. 20). The passenger was smoking a cigar at the time he got on the front platform of the car, and there' he paid his fare to the conductor. The facts of the case are so essentially different from those of the case before us that we think it does not sustain the contention of the appellant. In the case in hand it may be said that the deceased “ did not incur the peril at the request of the defendant or its officers or agents, or in pursuance of any general or special orders of the company.” (Gibson v. Erie Railway Co., 63 N. Y. 454, opinion of Allen, J.)

In. the course of the opinion delivered in Clark v. Eighth Avenue R. R. Co. (36 N. Y. 138) Grover, J., said: “ It is the [ duty of the passenger, on getting on board of a car, to place himself in a safe position therein, if he is able to obtain such position, and it is no excuse for him to place himself in an unsafe one, that the persons in charge know that he is unsafe and do not drive him therefrom, when the unsafety is known to the passenger. That riding upon the steps of a street car is less safe than a seat inside requires no proof. It is obviously so.”

In Holbrook v. The U. & S. R. R. Co. (12 N. Y. 244); Ruggles, J., in delivering the opinion of the court, approved of a charge which was to the effect that the jury must be satisfied from the proofs, not from speculation, that the defendant’s negligence alone caused the injury ; that if the negligence or want of care of the plaintiff contributed at all to the result, she could not recover; that the company only contracted to carry her safely when she kept - within the cars; that it was for the jury to say whether her elbow was out of the cars at the time of the injury, and, if it was, it was a circumstance or fact from which they might infer negligence or want of ordinary care on her part.” In the case in hand it clearly appears that the intestate was out of the car, away from his seat while the car was in motion, and that he not only stepped out upon the platform, but that he projected his head beyond the standard or side of the car, and that if he had not thus projected his head the injuries which he received would not have occurred.

Appellants call our attention to the case of Wheeler v. Watertown Street Railway Co. (77 Hun, 611; S. C. affd., 145 N. Y. 639). The facts of that case differ very essentially from those disclosed by. the evidence here. There the intestate was rightfully in the highway, and the question submitted to the jury was whether the defendant, after discovering the peril in which he was in, exerted itself to its full capacity to guard against the dangers. There is no evidence in the case before us to-indicate that after the intestate had pushed his head beyond the line of the car, any employee of the defendant had an opportunity to withdraw his person from the attitude he had assumed by thrusting a portion of his body beyond the line of the car. Upon all the facts disclosed by the appeal book I am of the opinion that the intestate was guilty of contributory negligence.

The foregoing views lead to the conclusion that the trial judge committed no error when he granted a nonsuit. (Morrison v. Erie Railway Co., 56 N. Y. 302; Solomon v. Manhattan R. Co., 103 id. 437; Hunter v. C. & S. V. R. R. Co., 112 id. 371; S. C. on second appeal, 126 id. 18; Krauss v. W. V. R. R. Co., 69 Hun, 482; Wiwirowski v. L. S. & M. S. R. Co., 124 N. Y. 420.) I am, therefore, inclined to vote for an affirmance of the nonsuit. However, my associates are of the opinion that the questions as to negligence and contributory negligence should have been submitted to the jury. Therefore, a reversal must be ordered.

Martin and Parker, JJ., concurred.

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


author: Hardin, P. J.:

text:
    Hormisdas De Loge, Respondent, v. The New York Central and Hudson River Railroad Company, Appellant.

      Negligence — dangerous speed of a train — contributory negligence ■ — • duty of a person riding with another — proof of the publication of a city ordinance.

    The question, whether a railroad company ran a train over a crossing at a dangerous rate of speed is one of fact, and if the jury so find the company will be liable, even in a case where it has given proper signals of the approach of the train.
    A person, who is a passenger in a vehicle driven by another, is not excused from exercising due care upon his own part while approaching a railroad crossing, but where the passenger is himself free from negligence he is not chargeable with the negligence of the driver unless he participated in it, or consented to it.
    What proof will be deemed sufficient to show a publication by the city of Water-town of an ordinance regulating the speed of trains while passing through the city.
    Appeal by the defendant, The New York Central and Hudson River Railroad Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the ■county of Jefferson on the 25th day of February, 1895, upon the verdict of a jury rendered after a trial at the Jefferson Circuit, and also from an order entered in said clerk’s office denying the defendant’s motion for a new trial made upon the minutes.
    This action was brought to recover for the alleged negligence of the defendant while running its cars across Rutland street in the city of "Watertown, July 5, 1894, at about nine o’clock, p. m. Plaintiff was riding along said Rutland street with one Keech in a carriage, and on approaching the defendant’s crossing upon said street was struck by one of the defendant’s trains and received injuries which caused the loss of both feet and ankles of the plaintiff; the amputation, of both legs between the ankles and knees being necessitated. i,
    Rutland street passes nearly north and south, and the railroad tracks nearly east and west. The train which occasioned the in juries to the plaintiff was due at "Watertown at about nine o’clock, and was ten minutes late. As ICeecli and the plaintiff approached the crossing from the north they passed a church where there was some festivity taking place, and the evidence is somewhat conflicting as to whether the night was light or dark, and there was some evidence that no bells were rung nor whistles sounded before the train reached the crossing; and the plaintiff testified that he heard no warning until he leaped from the buggy. The engine struck the carriage about the forward wheels, and Keech was killed and the plaintiff jumped from the vehicle and received the injuries mentioned.
    Plaintiff was riding in the carriage upon the invitation of Keech, a man about sixty years of age, a farmer, who lived near' Water-town, and for whom the plaintiff worked; and there is evidence that the plaintiff knew nothing of the existence of the .railroad. The evidence tended to show that the train approached the crossing at a speed of over twenty-five miles an hour. The defendant’s engineer testified, viz.: “ I won’t swear that we were not running faster than fifteen miles an hour when I crossed Rutland street; ” and the fireman said that he would not care to swear that the train was not running faster than twenty miles an hour; and the defendant’s conductor testified : “We were going faster than fifteen miles an hour over Hamilton street. We were going between twenty and twenty-five I should judge. We were not going more than probably eighteen or twenty miles over Central street. * * * X will swear we were not going twenty-five. Won’t swear we were not going twenty; might be twenty to twenty-two. I think it is about 300 feet from Central street to Rutland street. * * * I will swear we were not crossing Rutland street crossing at a greater speed than fifteen miles per hour. I know v.ery near the speed we were crossing that street that night; of course I could, not tell within a second, probably. * * * We were going faster than we ought to, of course; I knew it and didn’t try to stop it.”
    Plaintiff gave evidence tending to show that the city had adopted an ordinance forbidding the running of trains within the city limits faster than five miles an hour, under a penalty.

      Mullin, Griffin de Walker and D. G. Griffin, for the appellant.

      Smith <& Smith, for the respondent.
   Hardin, P. J.:

Upon all the evidence found in the appeal book we are of the opinion that the trial judge properly submitted the question as to whether the defendant was guilty of negligence in operating the train in question in the manner disclosed by the witnesses at the time the plaintiff’s injuries were received, as a question of fact to> the jury.

In Massoth v. D. & H. C. Co. (64 N. Y. 524) it was said:

“ Irrespective of any ordinance or law regulating the speed of railroad trains, it was a question of fact whether the rate was excessive or dangerous in that locality, and if so found by the jury, and such excessive rate of speed caused the collision, the defendant was liable for the consequences.”

A somewhat similar doctrine was restated in Cordell v. N. Y. C. & H. R. R. R. Co. (70 N. Y. 124).

In Thompson v. N. Y. C. & H. R. R. R. Co. (110 id. 637) it was said: The giving of the signals required by law does not, under all circumstances, render the defendant free from negligence if it ran its train at an undue and what might be found to be an improper and highly dangerous rate of speed through a village or city more or less densely populated.” (Towns v. R., W. & O. R. R. Co., 28 N. Y. St. Repr. 124.)

(2) Upon the evidence given by the plaintiff himself as a witness, and upon the circumstances disclosed in connection therewith by the other evidence in the case, we are of the opinion that the question of whether he was guilty , of contributory negligence on the occasion of receiving the injuries complained of was one proper for the jury to determine. Plaintiff had been invited by Keech to ride, and apparently was in possession of his faculties. lie was a, man some thirty-two years of age, and was in the company of Keech, who was about sixty years of age, and under the circumstances disclosed by the evidence of the plaintiff it was a question for the jury to determine whether Keech was guilty of any negligence in approaching the crossing. The evidence does not indicate that the plaintiff himself affirmatively was guilty of any negligence, or that he co-operated in any affirmative negligent act of Keech. Hpon all the evidence disclosed it was for the jury to determine whether the plaintiff was himself free from contributory negligence at the time the injuries complained of were received. (Masterson v. N. Y. C. & H. R. R. R. Co., 84 N. Y. 247; Miller v. N. Y. C. & H. R. R. R. Co., 82 Hun, 164; S. C., 31 N. Y. Supp. 317; affd., 33 id. 1130; Chisholm v. The State of New York, 141 N. Y. 246; McGoldrick v. N. Y. C. & H. R. R. R. Co., 142 id. 640; Bennett v. N. Y. C. & H. R. R. R. Co., 40 N. Y. St. Repr. 948; S. C. affd., 133 N. Y. 563.).

In the latter case (40 N. Y. St. Repr. 948) it was said: “ The plaintiff, being a passenger merely,' and having no right to direct or control Mulligan, while not excused from exercising care herself, Mulligan’s negligence cannot be imputed to her.” (Citing Robinson v. N. Y. C. & H. R. R. R. Co., 66 N. Y. 11; Masterson v. N. Y. C. & H. R. R. R. Co., 84 id. 247; Dyer v. Erie Railway Company, 71 id. 228; Platz v. City of Cohoes, 24 Hun, 101; Hoag v. N. Y. C. & H. R. R. R. Co., 111 N. Y. 199; S. C., 19 N. Y. St. Repr. 80.)

Hpon the evidence given at the trial we are of the opinion that the jury was warranted in finding the plaintiff free from negligence contributing to the injuries received. The foregoing views lead to the conclusion that there was no error committed by the trial judge in refusing a motion for a nonsuit “ upon the ground that upon the undisputed evidence the defendant is not chargeable with any negligence which contributed to the accident, and upon the .undisputed proof it does not appear that the plaintiff himself was in the exercise of any care to prevent the accident or, in other words, that he is chargeable with contributory negligence.” We think the motion based upon the grounds mentioned was properly denied, and that the exception to such denial presents no error of which the appellant can avail itself.

The appellant calls our attention to Bates v. N. Y. C. & H. R. R. R. Co. (84 Hun, 287). In looking into the facts disclosed in that case we find that they differ widely from the facts presented ' by the testimony in the case at bar, and, therefore, it does not sustain the contention of the appellant in this case.

(3) We think that no error was committed in refusing the request made to the court that it should charge “ that the negligence of Keech, to which the plaintiff consented or in which he participated, would defeat the plaintiff’s right of action.” The request was too broad. It assumed that Ileech was guilty of negligence. Second, it assumed that the plaintiff consented to such negligence or participated therein. In the body of the charge the court had observed: “ The fact that Keech may have been negligent does not impose liability for negligence on the part of plaintiff. If Keech was negligent, that negligence is not to be imputed to the plaintiff. On the contrary, the plaintiff could not rely upon the guardianship of Keech; he could not negligently permit himself to be in the custody of Keech and depend upon Keecli’s diligence and prudence, but he must necessarily have depended upon his own judgment, and he -was required to give care and diligence himself, notwithstanding Keech may have been negligent.” We think the charge as delivered was as fair upon the subject-matter embraced in the request as the defendant was entitled to receive at the hands of the court.

(4) We think that there was sufficient evidence to indicate that the city of Watertown had adopted an ordinance forbidding the running of trains at a greater rate of speed than five miles an hour through its city. In the 33d subdivision of section 8 of title 3 of its charter, which title defines the powers of the common council, authority is given to the common council from time to time to make, ordain and establish such by-laws and ordinances as may be necessary and proper. (See subd. 33, § 8, tit. 3, chap. 114, Laws of 1869.) The charter expressly authorizes the common council to regulate the speed of railroad cars. (See subd. 26 of § 8 of title 3 of the charter.) Subdivision 33 of section 8 of title 3 of the charter provides that such by-laws and ordinances as shall be adopted by the common council shall be published in such manner as the common council may direct before they take effect.” It seems that the common council adopted an ordinance, in 1890 providing that it should take effect on the 16th day of October, 1890, which, upon inspection, turned out to be an amendment of a previous ordinance upon the same subject, with the same purport, however, as to the rate of speed at which trains should be operated within the city. At the time of the adoption of the ordinance of 1890, a direction was given that the ordinance should be published in the Watertown Daily Times and .Watertown Retmion before the date of its taking effect. Section 3 of title 2 of said charter, as amended by chapter 810 of the Laws of 1811, provides that the chamberlain shall act as clerk of the common council. There was a certificate of the publication of such ordinance produced by the chamberlain, as were also certain affidavits of publication of the same. Upon the argument before us the original Exhibit No. 9, as marked at the trial by the reporter, was produced, which purports to be an affidavit made by Charles W. Clare, publisher of the Watertown Reunion, to which affidavit is annexed a printed copy of the ordinance, and attached to that affidavit and annexed to the printed copy of the ordinance is the affidavit of Charles E. Cole, publisher of the Watertown Daily Times, in which affidavit it is said, “ That a notice of which, the annexed is a printed copy has been published in said newspaper.” We think the affidavit must be read in connection with the ordinance, of which a printed copy appears attached to the affidavit, and that the objections to the introduction in evidence of the ordinance were properly overruled, and that the exceptions thereto do not present error. (Code Civ. Proc. §§ 926, 941,)

No other exceptions are pressed upon our attention by the brief of the learned counsel for the appellant, nor were any others discussed in the course of his oral argument. Several others seem to have been taken during the trial, but have not been regarded as of sufficient consequence to justify an argument in respect thereto from the appellant’s learned counsel. Plaintiff received very serious injuries and no objection is made by the appellant’s counsel to the amount of damages awarded therefor. The foregoing views 'lead us to sustain the verdict.

The judgment and order must be affirmed, with costs.

Martin and Merwin, JJ., concurred.

Judgment and order affirmed with costs.


author: Per Curiam :

text:
    Mary C. Hargin, as Administratrix, etc., of Letitia C. Baker, Deceased, Appellant, v. Frederick S. Wicks and Others, Respondents, and Mary C. Hargin, Appellant.

      Execution — a sale in pwrcels waived, when not demanded — when the judgment debt- - or’s successor in interest cannot attack it.

    The provisions of section 1437 of the Code of Civil Procedure, providing that where real estate offered for sale under an execution consists of two or ftiore known tracts, lots or parcels, it must be sold in parcels, where such a course is required by the owner or by one who is entitled to redeem the premises, are merely directory in their nature; and where two lots have been sold together, with the knowledge of and without objection upon the part of the owner, the successor in interest of such owner cannot procure the sale to be set aside after a sale of the property has been made by the purchaser.
    Appeal by the plaintiff, Mary 0. Hargin, as administratrix, etc.,, of Letitia C. Baker, deceased, and by the defendant, Mary C. Hargin, individually, from a judgment of the Supreme Court in favor ,of the defendants, entered in the office of the clerk of the county of Onondaga on the 21st day of June, 1895, upon the report of a referee.
    Plaintiff’s complaint asks that the defendant Raynor be directed to execute a quit-claim-deed to the plaintiff, conveying to her all the right, title and interest which the said Raynor acquired under a sheriff’s sale mentioned in the complaint, and that the defendant. Wicks may be adjudged and decreed to have held said premises in trust for the plaintiff, and that the defendant Raynor may be adjudged and decreed to hold the same upon a like trust, and that Mary 0. Hargin, individually, maybe adjudged and decreed to have no interest therein.
    ■The action was originally commenced in the name'of Letitia 0. Baker, and after her death the court substituted Mary 0. Hargin,, the administratrix of her estate, as plaintiff and added Mary C. Hargin, individually, as a defendant, and allowed a supplemental complaint to be filed, and allowed the answers theretofore served to stand as answers to the supplemental complaint.
    ■ In her lifetime Letitia 0. Baker claimed to be an owner of one undivided sixth part of farm lots 186 and 187 of the Onondaga Salt Springs reservation, a tract of land which contained about 130 acres, and has already been the subject of considerable litigation. (See Balter v. Oaltwood, 49 Hun, 416; S. C. affd., 123 N. T. 16.) Prior to 1892 there had been recovered against her five judgments, one of $109.40 in favor of Imogene S. Granger, and one of a like amount in favor of Josephine Raynor, and one of $134.40 in favor of Josephine Raynor and others, and one of $125.85 in favor of'Oakwood, and another of $92.99 in favor of Oakwood. All of these judgments were recovered through Frederick S. Wicks as attorney, except the last two, which were obtained through the firm of Green &. Com-stock. Executions were issued on the four judgments first mentioned and put in the hands of the sheriff of Onondaga county against Mrs. Baker, who had no personal property, and an advertisement was caused to be posted and published by the sheriff to the effect that he would sell all the estate, right, title and interest which the said Letitia C. Baker had on the 10th day of October, 1887, or at .any time thereafter, in the farm lots 186 and 187 of the Onondaga Salt Springs reservation in the city of Syracuse.
    At the sale which took place on the 16th day of'June, 1891, Wib liam G. Tracy bid the amount of the four judgments mentioned, and the sheriff’s costs, and took a certificate from the sheriff. No redemption was made by Mrs. Baker, and in August, 1892, she executed a mortgage for $20,000, covering the premises in question, to William S. Andrews, who, by virtue thereof, redeemed from Mr. Tracy by paying what was due at the time of the redemption.
    Subsequently Frederick S. Wicks redeemed under the Oakwood judgment of $92.99 docketed in Onondaga county on the 18th of October, 1888, he having become the owner of that judgment. On the 16th day of September, 1892, he paid to the sheriff the sum of $620.88, and delivered to him a copy of the docket of the judgment under which he redeemed, together with the assignment thereof and the affidavit required by the Code of Civil Procedure; the sheriff ■executed to him the usual certificate, and after the expiration of twenty-four hours, no other redemption having been rmade by any •other party, the sheriff executed to Wicks, as such redeeming creditor, the usual deed of the premises.
    It appears from the evidence that although Mr. Andrews had been the attorney for Mrs. Baker in the various actions in which the judgments in question had been obtained against her, “ yet at this time he had no recollection of the numbér of such judgments. By examining his own registers or the records of the county clerk’s office this fact would undoubtedly have been called to his mind. Instead of making such an examination, however, he had an interview with* IVIr. Wicks.” As to what took place at that interview there is conflict in the evidence.-

      Knajpjp, Nottingham cfl Andrews, for the appellants.
    IF. G. Tracy, for the respondents.
   Per Curiam :

Plaintiff is not in a situation to have- the sale made by the sheriff set aside because the premises were- not sold in parcels. Mrs, Baker and her attorney knew of the advertisement of the property and of the sale by the sheriff, and made- no objection at the time of the sale or claim that it should be sold in parcels. Subsequently there was a redemption from the sale, and when such redemption was-made Mrs. Baker and her attorney knew that the premises had not been sold in parcels, and apparently the- mortgage under which the redemption was made described the property in the same manner as the sheriff’s notice of sale. -

Section 1437 of the Code of Civil Procedure, relating to the sale of real estate upon execution, is substantially like the provisions found in the Revised Statutes upon that subject, and is directory. The plaintiff in this action is not entitled to have the sale set aside-after a conveyance thereof has been made to the defendant Raynor,, because the sale did not take place in parcels. (Mohawk Bank v. Atwater, 2 Paige, 54; Cunningham v. Cassidy, 17 N. Y. 276; Wood v. Moorhouse, 1 Lans. 405; S. C. affd., sub nom. Wood v. Morehouse, 45 N. Y. 368.)

Nothing appears in this case to indicate that the-judgment debtor was injured or prejudiced in any manner by the- failure of the sheriff to sell the premises in question in parcels,

(2) The-referee before whom the cause was tried held and decided upon the evidence “ that the defendant Wicks- was not estopped by anything said or done, or which he omitted to say or do, from making the redemption which he made.” According to the evidence the redemption was made by him in accordance with the usual rules and practices relating to redemptions, and the sheriff was, therefore, warranted in executing to him a deed of the premises, and he thus acquired title to the same which he conveyed to the defendant Baynor.

The referee has also found “ that said Andrews was not misled by any false or fraudulent statements of said Tracy or Wicks, or either of them.” Upon looking into the evidence we find that it is somewhat contradictory in respect to what transpired at the time of the interview between Wicks and Andrews, and applying to. the evidence the rule that where there is a conflict, or where different inferences or deductions are to be made, the findings of the referee are to be accepted unless against the clear preponderance of the evidence, we are constrained to accept the findings of fact as stated in the decision made by the learned referee. The onus was very clearly upon the plaintiff to establish the essential facts upon which she predicated her right to relief. The referee has evidently failed to construe the evidence favorably to the plaintiff. After a patient study of the evidence, we are not inclined to overturn the deductions made by the referee from all the testimony offered before him. The foregoing views lead to an affirmance.

The judgment must be affirmed, with one bill of costs against the appellants.

Present — Hardin, P. J., Merwin and Parker, JJ.

Judgment affirmed, with one bill of costs against the appellants.


author: Per Curiam:

text:
    The People of the State of New York, Plaintiff, v. The Merchants’ Bank of Binghamton, N. Y., Defendant. E. & G. Friend & Company, Respondents; George W. Dunn, as Receiver of The Merchants’ Bank of Binghamton, N. Y., Appellant.

      Bank, collecting a note — stands in, the relation of tailor to its customer — the customer may recover the amount from a receiver of the tank.

    E. G. Friend & Co., merchants of New York city, sent to the Merchants’ Bank of Binghamton for collection a note made by Reynolds, Rogers and Lay, residents of Binghamton, whose account was not good for the amount of the note when it became due, but on the same day Reynolds, Rogers and Lay deposited a sum sufficient to meet the note, whereupon the bank canceled the note as paid, returned it to the makers and charged its amount to their account. It then sent to E. G. Friend & Co., a draft upon the American Exchange Bank of New York city, for the amount collected, less collection fees, but, before the draft was presented, the' Merchants’ Bank of Binghamton had gone into the hands of a receiver and the drawee refused payment of the draft.

      Held, that E. G. Friend & Co. were entitled to full payment of the note from the receiver, less the charges of collection;
    That the relation between them and the Merchants’ Bank was that of bailor and bailee, or of trustee and cestui que trust, and that the fund in the hands of the receiver was sufficiently impressed with a trust in their favor to give them an equitable title thereto to the extent of their debt.
    Appeal by George "W. Dunn, as receiver of The Merchants’ Bank of Binghamton, N. Y., from an order of the Supreme Court, made at the Broome .County Special Term and entered in the office of the clerk of the county of Broome on the 3d day of April, 1895, directing him as receiver to pay in full the claim of the respondents.

      Mandelbaum Bros, and Ambrose G. Todd, for the respondents.

      George F. lyon, for the appellant.
   Per Curiam:

The petitioners, E. & G. Eriend & Co., are merchants in the city of New York. On December 29, 1894, they sent to the Merchants’ Bank of Binghamton three promissory notes, payable at that bank, made by Reynolds, Rogers & Lay, who resided in Binghamton, and were depositors in the Merchants’ Bank. Accompanying the notes was a letter to tlie cashier of the bank which was as follows ;• “We beg to enclose for collection, Reynolds, Rogers & Lay, $1,073.25; do. Am. Exch., $1,000 ; do. ‘ Paid,’ $1,36413, for proceeds of which please send New York exchange, and oblige.” Each of these notes was indorsed upon the back, “ Pay to the order of Merchants’ Bk. for collection account of E. & G. Eriend & Co.” Eriend & Co. had no account with the Merchants’ Bank. The first of these notes was paid at maturity, and the bank remitted the proceeds less its charges. The second matured January 17, 1895. On that day the account of Reynolds, Rogers & Lay was n'ot good for the amount of the note, but they deposited $631.10 to make their account sufficient to meet it. The bank thereupon stamped and canceled the note as paid, returned it to Reynolds, Rogers & Lay, and charged the same to their account. It then sent to Eriend & Co. its draft upon the American Exchange Bank of New York city for the amount collected, less one dollar collection fees. Before it was presented the Merchants’ Bank went into the hands of a receiver, and the American Exchange Bank declined to honor the draft. The amount deposited and standing to the credit of Reynolds, Rogers & Lay in the Merchants’ Bank has never been drawn out, and there has been in that bank at all times since such deposit was made more than money enough to pay the petitioners’ claim. The third note had not matured when the receiver was appointed, and it was returned to Eriend & Co.

On April third a motion was made for an order directing the receiver to pay to the petitioners the sum of $999, that being the amount of the note less the commission for collecting it. This motion was based upon the verified petition of Friend & Co., and an affidavit of Frank B. Reynolds. Upon the hearing the affidavit of George W. Ostrander was read in opposition to such motion, and upon the hearing the court granted the order appealed from.

Practically the same question as is presented upon this appeal was before us in the case of Arnot v. Bingham (55 Hun, 553). In that case all the essential facts were substantially like those in the case at bar. We there held that the owners of the note were entitled to collect the proceeds thereof from the receiver of the bank to the extent of the funds he received from the bank that were in its possession when it failed. We also held that the relation between the former owners of tlie note and. the bank was that of bailor and bailee, or trustee and cestui que trust, and that the fund received by the receiver was the property of the owners of the note, or so far impressed with a trust in their favor as to give them an equitable title thereto. If that case was correctly decided, it follows that the order in this case should be affirmed. While it must he admitted that in that case we were not free from doubt, and that the General Term of the fifth department has held an opposite doctrine, still, upon a re-examination of the question we are disposed to adhere to our former decision and affirm the order appealed from.

Present- — Hardin, P. J., Martin and Merwin, JJ.

Order affirmed, with ten dollars costs and disbursements.


author: Per Ouriam :

text:
    In the Matter of the Administration of the Estate of James Denick, Deceased. Mary J. Denick, Respondent; Jared W. Denick and Others, Appellants.

      Divorce — if valid in another State, where it is obtained upon substituted service of process upon a citizen thereof, it is valid everywhere — effect of the imprisonment of the defendant in another State.

    While a person retains the relation of a citizen to a State he is subject to the laws of that State, which he cannot evade by a temporary or prolonged absence ’ from the State, whether such absence is voluntary or the result of imprisonment in a foreign State.
    A judgment of divorce rendered by the courts of a State against one of its citizens upon a substituted service of process, such as is authorized in the case of an absent defendant, is valid to effect a dissolution of the marriage contract, and is conclusive upon the parties in every other State although the defendant was not within the territorial jurisdiction of the court during the progress of the suit and did not appear therein.
    Appeal by Jared W. Denick and others from an order or decree of the Surrogate’s Court of the county of Oswego, entered in said Surrogate’s Court on the 7th day of May, 1895, appointing Mary J. Denick administratrix of the estate of James Denick, deceased.

      Piper <& Biee, for'the appellants.

      Charles F. Bulger and C. F. Whitney, for the respondent.
   Per Ouriam :

James Denick, at the time of his death, resided in Oswego county N. Y. He died March 3, 1895. After his death Jared W. Denick filed with the surrogate of Oswego county a petition praying for letters of administration upon the estate of the decedent, and a citation was served upon the respondent. ' On the return of such citation the respondent filed with the surrogate a petition asking that, as his lawful widow, letters of administration upon the estate of the decedent be issued to her. Thereupon Augusta Terpening, Eugenia Mount, Jared W. Denick and Horatio S. Denick, who were the children of the decedent, filed an answer to the respondent’s petition, in effect denying that she was the widow of the decedent, and alleging that she had a former husband living, from whom she had never been lawfully divorced, and that she was still the lawful wife of such former husband.

The issue thus raised was tried in the Surrogate’s Court, and after hearing the testimony the court found that the respondent was married to Horace D. Guernsey, her former husband, in December, 1869, and lived with him until about April, 1881; that about February, 1881, the respondent and Guernsey moved to the State of Michigan and took up their residence there; that in April of that year Guernsey was arrested on an extradition warrant, taken to the State of New York, tried, convicted of burglary, sentenced to the State prison for three years, served his sentence, and when released returned to the State of Michigan, where he has since resided.

The surrogate also found that on March 13, 1882, the respondent instituted proceedings in one of the Circuit Courts of the State of Michigan against Guernsey to dissolve the marriage between them, and that such proceedings were duly had according to the laws and practice of the State of Michigan; that on August 25, 1882, a final decree of divorce was duly granted, absolutely dissolving the marriage between the respondent and Guernsey; that such decree of divorce had from that date been and still was in full force and effect; that it was legal and in accordance with the laws of the State of Michigan, and that under the laws of that State the respondent had a right to remarry; that on September é, 1891, the respondent and the decedent were duly married in the State of Michigan, and from that time until the decedent’s death lived and cohabited together as husband and wife, and that such marriage was legal and valid under the laws of the State of Michigan.

Upon the facts thus found, as conclusions of law, the Surrogate’s Court held. that the decree of divorce granted the respondent was valid and in all respects legal, and that after August 25, 1882, the respondent had a legal right to remarry; that the marriage between the respondent and the-decedent was valid under the laws of the State of Michigan and valid in this State; that the respondent was the lawful wife of the decedent at the time of his death, and, therefore, became his lawful widow and was first entitled to administer his estate.

In pursuance of and in accordance with this decision, an order was duly granted appointing the respondent administratrix of the estate of the decedent.

A careful examination of the evidence in this case shows that it was sufficient to sustain the findings of the learned surrogate, and, therefore, in determining the question presented, the facts as found. must be regarded as established. The principal, and practically the only controversy between the parties is as to the validity of the divorce granted to the respondent. That the judgment of divorce is valid and binding upon the parties, if the court granting it had jurisdiction, is manifest and not denied by the appellants. So that the only question that need be determined upon this appeal is whether the court had jurisdiction to grant a judgment of divorce dissolving the marriage between the plaintiff and Horace' D. Guernsey.

When this judgment was granted, the respondent and her former husband were both citizens and residents of the State of- Michigan, although the husband was temporarily enduring a forced absence from the State. Under these circumstances, we are of the opinion that the courts of the State of Michigan had jurisdiction to dissolve the marriage between the parties in accordance with the laws of that State, even though the defendant was temporarily absent and was only constructively notified of the action against him. It seems to be settled that where both of the parties to a marriage contract are bona fide citizens of and domiciled in any State, the courts of that State have power to divorce them, and such a divorce is valid, not only in the State where it is granted, but in every other, and that jurisdiction of the person of a defendant in an action for divorce may be acquired by a court of the State of which he is a domiciled citizen by such proceedings in the nature of service of process as the law of the State has made the equivalent of personal service within its jurisdiction. While a person retains the relation of a citizen of the State, he is subject to its laws, which he cannot avoid by a temporary or prolonged absence from the State. Therefore, a judgment of divorce rendered by the courts of a State against such citizen upon a substituted service of process, such as is authorized in the case of an..absent defendant, is valid to effect a dissolution of the marriage contract, and is conclusive upon the defendant in every other State, although he was not within the territorial jurisdiction during the-progress of the suit and did not appear therein. (Black on Judgments, § 926; Hunt v. Hunt, 72 N. Y. 217; Rigney v. Rigney, 127 id. 408, 413; De Meli v. De Meli, 120 id. 485, 495; Kinnier v. Kinnier, 45 id. 535.)

The cases cited by the appellants are clearly distinguishable from this. In those cases the general doctrine held is, that a judgment in one State cannot have the effect of binding a citizen of another without his consent, or fix upon him a status which is against his will and is in hostility to the laws of. the State where he resides; and, hence, a court of one State cannot adjudge the dissolution of the marital relations of a citizen of another State who is domiciled and actually residing there during the pendency of the judicial proceedings in the former State, unless there is a voluntary appearance. The distinction between the class of cases last referred to and the case at bar is that in the latter both parties were citizens and residents of the State in which the divorce was granted, while in the former, one of the parties was a citizen of another State, so that the court neither had nor acquired any jurisdiction to affect his status or relations to the other party. We are of the opinion that the judgment of divorce obtained by the respondent was valid and dissolved the marital relations between herself and her former husband, and that the marriage between her and the decedent, winch took place in tlie State of Michigan, under the laws of which the divorce was granted, was also valid, and, being valid under the laws of the State of Michigan, it was valid in this State.

These considerations lead to the conclusion that the order appealed from was correct and should be affirmed.

Present — Hardin, P. J., Martin and Merwin, JJ.

Order affirmed, with costs payable out of the estate.


text:
    Challenge Corn Planter Company, Respondent, v. Frank Diel, Appellant.

      Guaranty of goods to be sold — not binding where there is no present consideration moving to the guarantor — ■abandonment of the contract— an alteration made without the consent of the guarantor extinguishes his liability — a change in the time of payment.

    A guaranty should be construed, according to the apparent intention of the parties, and when its meaning is ascertained the guarantor or surety cannot be held liable beyond the precise terms of his contract.
    Persons who are sui juris may waive or abandon a contract, and where both of the contracting parties concur in a waiver or abandonment, the contract is dissolved.
    An agreement to guarantee the payment by another of goods to be sold in the future, not founded upon any present consideration moving to the guarantor, imposes no obligation or liability upon the guarantor and is revocable by him at any time before it is acted upon. • '
    Any alteration of the contract, made without the consent of the guarantor or . surety, extinguishes his liability irrespective of the question whether-the alteration would work an injury to him or‘not.
    A change in the time when payment is to be made under a contract is a material alteration of the contract and discharges its guarantor.
    Appeal by the defendant, Prank Diel, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 3 3tli day of March, 1895, upon the verdict of a jury rendered by direction of the court after a trial at the Onondaga Circuit, and also, from an order entered in said clerk’s office on the 18th day of March, 1895, denying the defendant’s motion for a new trial made upon the minutes.

      This action was brought to recover a balance, alleged to be due, of the purchase price of certain refrigerators alleged in one count of the complaint to have been sold by the plaintiff to the defendant, and in a second count to have been sold to one S. Ivl. Fort under an alleged guaranty 'of payment made by the defendant at the time of a sale of refrigerators by the plaintiff to said Fort.

      Goodelle cfi Nottingham and William Nottingha.m, for the appellant.

      Jenney c& Marshall, for the respondent.
   Per Curiam :

In February, 1892, an agent of the plaintiff went to the store of the defendant to sell him refrigerators manufactured by the plaintiff,, and an arrangement was entered into between them by which the defendant was to have the sale of the plaintiff’s refrigerators in the city of Syracuse for the year 1892, and the defendant was to give the plaintiff an order for a carload of refrigerators. After this, arrangement was consummated, the defendant suggested to the plaintiff’s agent that he help him by going to and selling S. M. Fort refrigerators for his account. The agent went and obtained an order directed to the plaintiff which, so far as material, was:

“ Please send me, on or about May 1st, 1892, the below refs, and chests, the No. 8 to cost $7.00 each, net; all others at a discount of 45 per cent; your 1892 list. Terms, payable July 1st, or note, or 2 per cent May 10th, ’92, freight allowed to Syracuse, N. Y.

“ (Signed.)' S. M. FORT.”

The order ivas delivered to the defendant, who entered it, and on February twenty-fourth, wrote the following, which was directed to the plaintiff: “ Please enter my order for 1 carload of Challenge refrigerators at 50 and 5 per cent. List delivered. Terms, May 1st, 60 days or 2 per cent, cash 10 days. And the enclosed order from S. M. Fort to apply on the carload, you to charge and bill the refrigerators direct to him, and collect pay for same as specified in the order, and to credit me with the difference in amt. between 45 per cent and 50 and 5 per cent, and I to guarantee the payment of same "Will send specifications for balance of carload in time to ship with Fort’s order. (Signed) Frank Diel.”

The' defendant then delivered the Fort order and his own to the agent, who mailed them to the plaintiff. On March fourth, the plaintiff wrote the defendant: “ Your order accepted, and will go forward as per your order. Many thanks.”

On March twenty-first a bill .of the refrigerators was sent to Fort, which, so far as material, was: “ Challenge Corn Planter Co. * * * Sold to S. M. Fort, Syracuse, N. Y. Due July 1st, 1892. Interest after due. (Then follows the list of refrigerators and prices.) Payment on above guaranteed by Frank Diel, Syracuse, N. Y.” On the twenty-sixth of the same month Fort wrote the plaintiff : “I have to-day received your invoice of March 21st, amounting to $409.73. I am somewhat surprised at this, as according to order given your agent it was conditional and so accepted in writing by him; that was, that if you accepted my order you were to advise me by return mail. After waiting and not hearing from you, I concluded you had decided not to accept, and so within the past few days have placed my order with another house. In view of the facts, the goods must remain at the depot at your disposal, or at least until I hear from you.”

It seems that on the twenty-ninth of March Fort’s letter was sent to the defendant, after which he wrote the plaintiff: “Yours of 29th, also Mr. Fort’s letter, received this a. m., and I am at a loss to know why you should send his letter to me, as I have nothing to do with the transaction. Y our man made the sale, and he must have known what he was about, and if yon have Mr. Fort’s order, and signed by Mm, I would make him take the goods; as far as his having placed his order with another house is all bosh, for I know better. He is trying to ci-awl out, and thinks lie has ordered too many. I shall take mine when they arrive, and will have nothing to do with those consigned to Mr. Fort.”

On April fifth the defendant’s son, who was in charge of his business, wrote plaintiff: The refrigerators came this a. m., and as Mr. Fort’s refrigerators came first and near the door, I went over and told Mm they were there, and to get them so we could get ours out, and to my astonishment he replied that he would not touch them, and absolutely refused to receive or have anything to do with them, claiming that you violated your agreement with him in selling us the goods. Mr. Diel is out of town, and won’t be home until Saturday night, and as I am not familiar with the particulars of the case, I would not take his lot or pay the freight on them. They are laying over in the freight yard, and I won’t touch them until I hear from you; so please advise me on receipt of this by wire what to do in the 'matter, or what course you intend to pursue with Mr. Fort. Awaiting your reply, I am.”

On April seventh the plaintiff telegraphed the defendant: “Receive the refrigerators, and draw on us for freight.” On the same day it wrote: “ This refrigerator transaction is an (unknown quantity to us). We only know Mr. Neal, of N. Y., sent us the order, and we notified the party upon recpt. of same; further we know not. We wire you to receive, pay freight and draw on us for freight. If you can sell them, all right; if not, will order away. One thing sure: Whatever is honorable or fair on the part of our Co. between you and us will be carried out to the letter. Matters not what Mr. Neal or Mr. Fort has to say in the matter. Hoping this is satisfactory, we remain.”

On the twelfth of April Fort sent the plaintiff this letter: “ In the latter part of March we wrote to you about the refrigerators named in an invoice dated the 21st of March. We have not had any response from you on the subject and would be glad of a reply by first mail.” On April fourteenth the plaintiff replied : “ Yours of the 12th inst. at hand. It seems our correspondence is quite unsuccessful. First, upon receipt of your order here (given Mr. Neal, of N. Y.) we acknowledged receipt the same day. Not hearing anything from , never dreamed you did not receive our letter of acknowledgment; of course we shipped the goods. Upon receipt of invoice we read your letter saying you would not receive them, as you had not received notice from us, that we accepted the order, with the statement you did not understand — that others were to handle the same line in Syracuse. This is a thunderbolt to us, as wre were ignorant of any talk, promises; in fact, all we knew was the order to ship so and so. Upon receipt of same we wired our old customer, Frank Diel, to pay freight, receive them subject to our order, and there they are, as we suppose, not knowing anything to the contrary. We are very sorry, as it must be annoying to you, as well as expensive to us, of course; we can dispose of the refrigerators, but that does not restore the confidence between us that ought to exist. You understand, as a business man, that manufacturers and their customers’ interests are mutual, and we endeavor to please our customers rather than to displease them. We aim to do so. We cannot read the hearts and minds of men, and we do not know what salesmen say to our customers; but we'do intend to deal fair and just, and we don’t make refrigerators enough to change us one inch from doing the square thing to all. We would like to have you take the goods; but if you cannot see'your way clear, under the circumstances, we shall, of course, accept the situation as it stands. If you wish and know who we are, ask Hy. Lacy,, cashier; he will tell you. Trusting explanation satisfactory, we remain.”

On April sixteenth Fort again wrote the plaintiff: “ Yours of the 14th inst. to hand and must say that our correspondence has at least been unfortunate. Now, although I was not notified of the acceptance of my order, and in consequence ordered other goods, yet, although it will almost double up my stock, I will take them provided you will take the payment on them by note for half the amount dated July 1st and note for the balance in a reasonable time thereafter. The goods are now at the depot warehouse, and if you agree to my proposition you will please wire me at my expense.” In response to this the plaintiff on April eighteenth wired Fort: “We accept of your proposition,” and on the same day wrote: “ This is to confirm my message to-day, £ We accept of your proposition.’ We hope same will be satisfactory you.” On the fourteenth of July the plaintiff sent a blank note to Fort, accompanied by this letter: “ In reply to yours of 12th. Please fill out, sign and return to us the enclosed blank note, making it due at time you can conveniently pay it.” • ,

On the 14th of September, 1892, -the defendant sent the plaintiff his check for $236 to balance the account for the refrigerators purchased by him, and in the account was included $55.16 for commission on the refrigerators sold to Fort. On September sixteenth the plaintiff wrote the defendant: “Yours of 14th inst. enclosing cash, $236.00, in full of account, is received with thanks. Soliciting your valued future orders we are.”

On February 23, 1893, the plaintiff wrote the defendant: “We have not as yet been able to get a settlement with S. M. Fort of your place. "We have done everything we could in regard to the matter, and have waited as long as we can and shall exj>ect you to settle for this at once as per contract. Let us hear from you.” To this the defendant, on March fourth, replied : “Yours of Eeby. 23rd received and in reply would say that I am very much surprised at its contents; that you should ask me to pay for Mr. Fort’s refrigerators after my having written you on March 31st, 1892, that I would have nothing whatever to do with them, and I refer you to my letter of that date, and I positively refuse to pay for them and think it a great imposition and nerve on your part to ask anything of the kind.” On March 6, 1893, the plaintiff wrote : “Yours of the 4th inst. at hand. "We hold your guarantee for the acct. and we shall look to you for the payment of the acct. If we ai’e forced to collect the acct. from you we shall do so.”

The foregoing is a brief synopsis of the evidence so far as it is material to the questions involved on this appeal. The trial court held that the defendant’s letter of February 24,1892, and the plaintiff’s acceptaiice, constituted a guaranty of the payment of the bill of goods sold Fort; that, as a matter of law, the plaintiff was entitled to recover of the defendant the amount of such bill and interest and directed a verdict accordingly.

The appellant challenges the correctness of this decision, and insists that the contract resulting from Fort’s order and its acceptance was dissolved by a new and different one, or was at least so far modified or changed as to relieve the defendant fro2n any liability upon his guaranty.

Whatever controversy may have formerly existed in respect to the rule governing courts in the construction of guaranties, it now seems to be settled hi this State that they should be construed according to the apparent intention of the parties. But when the meaning is ascertained the surety cannot be held liable beyond the precise terms of his contract. (Evansville Nat. Bank v. Kaufmann, 93 N. Y. 273, 281; Powers v. Clarke, 127 id. 417, 424; McShane Co. v. Padian, 142 id. 207, 210.) Any alteration of a 0021-tract as to which a third person has become a guarantor or surety, without his consent, extinguishes his liability, irrespective of the question whether the alteration would work any injury to him or not. This is because the surety has never made the contract upon which he is sought to be charged. (The People v. Vilas, 36 N. Y. 459; Paine Jones, 76 id. 274, 278; Page v. Krekey, 137 id. 307, 314.) Persons who are competent to make a contract are equally competent to waive or abandon it, and where both concur in a waiver or abandonment the contract is dissolved and the rights of each under it are at an end. (Graves v. White, 87 N. Y. 463; McEachron v. Randles, 34 Barb. 301; Tayleur v. Wildin, L. R. [3 Ex.] 303; Kay v. Groves, 6 Bing. 276.) An agreement to guarantee the payment by another for goods to be sold in the future, not founded upon any present consideration passing to the guarantor until acted upon, imposes no obligation and creates no. liability upon the part of the guarantor, and is revokable by him at any time before it is acted upon. (Jordan v. Dobbins, 122 Mass. 168; Offord v. Davies, 12 C. B. [N. S.] 748; Agawam Bank v. Strever, 18 N. Y. 502, 514; Hunt v. Roberts, 45. id. 691, 696.)

"When we consider the facts in this case and apply to them these principles, we think it is obvious that the court erred in holding as. a matter of law that the plaintiff was entitled to the recovery directed. An examination of the correspondence between the parties tends to. show that there was a waiver or abandonment of the original contract between the plaintiff and Port. But, be that as it may, that, it was altered there can be no doubt. The undisputed evidence shows that under the original contract between the plaintiff and Fort the terms of payment were: Payable July 1st, or note, or ■2• per cent May 10th, ’92.” Under that contract Port refused to take the goods upon the ground that he had received no notice from the plaintiff of the acceptance of his order. Subsequently he proposed to the plaintiff that he would take them if the plaintiff would take the payment on them by note for one-half the amount dated July 1st and note for the balance in a .reasonable time thereafter.”' This proposition was accepted by the plaintiff. Construing Fort’s, original order as favorably to the plaintiff as possible, Fort was required by it to pay the amount July first or then give his note therefor. By the subsequent agreement he was required to give his note for only one-half of the purchase price at that time, and for the remainder he -was to give his note in a reasonable time thereafter. Hence there was an essential change in the time of payment, which might materially affect the defendant. The defendant might have been willing to guarantee payment under the first contract and unwilling to guarantee it under the second. His contract with the plaintiff was to guarantee the payment under the precise terms •of the original order.. When a new agreement was made the •defendant was not liable, because he had never made any contract to guarantee the payment under the latter.

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

Present — Hardin, P. J., Martin and Merwin, JJ.

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


author: Per Curiam: :

text:
    The Jefferson County National Bank, Respondent, v. Margaret A. Townley and Hugh C. Townley, Appellants, Impleaded with The Eureka Chemical Company.

      Insolvent corporations — preferences in favor of an officer — illegal scheme — equitable relief

    An officer of an insolvent corporation is prevented by the terms of the Revised Statutes (Part 1, chap. 18, tit. 4, § 4) from acquiring a preferential lien on corporate assets by legal process.
    In an action brought by a j udgment creditor of the Eureka Chemical Company to set aside a judgment recovered by Margaret A. Townley against that corporation, it appeared that both she and her husband were stockholders in the corporation; that her husband was its secretary, treasurer and manager; that he had claims against it for services and for advances; that the corporation was insolvent to the knowledge of both the husband and the wife; that he assigned his claims to his wife; that actions were brought by her against the corporation; that the papers therein were served upon him as one of its officers, and that this fact was kept secret until judgments by default had been entered in such actions against the corporation and executions thereon had been issued and levied,

      Held, that the transaction was in violation of the statute, as an attempt to secure an unlawful preference over other creditors of the corporation;
    That the equitable powers of the court could properly be invoked to declare void the judgments in question.
    Appeal by the defendants, Margaret A. Townley and another, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 22d of January, 1895, upon the decision of the court rendered after a trial at the Onondaga Special Term.
    The appellants are husband and wife, and each became stockholders in the defendant corporation. On the 12th day of March, 1888, the appellant Margaret A. Townley executed a formal assignment of her thirty shares of stock to her husband. The full transfer of the stock on the books of the corporation and the issuance of the scrip therefor were not completed. On March 21,1888, the husband, in a letter to F. 0. Eddy, giving a list of the stockholders of the corporation, enumerated Mrs. II, 0. Townley as thé owner of thirty shares, of stock. On the 17th day of September, 1889, and subsequently, Hugh 0. Townley was a stockholder of the defendant corporation, and was secretary, treasurer and manager of the company, and held claims for services and an indebtedness against the corporation, as well as for advances made; and the evidence seems to indicate that after he and liis wife knew of the insolvency of the corporation they entered into a scheme to circumvent the provisions of the statute which prohibited him from acquiring, by transfer or otherwise, any of the assets of the defendant corporation in payment of his indebtedness, by way of preference; that in consummation of that scheme formal assignments of his claims against the defendant corporation were made to his wife, and actions were brought in her name upon such claims against the corporation. The papers in such actions were served upon him as an officer of the corporation, and the fact of such service was kept secret until judgments in such actions were entered by default, upon which executions were issued and levies were made by the sheriff.
    The trial judge, found, viz.: “The assignments of the claims against the Eureka Chemical Company, made by the defendant Hugh C. Townley to the defendant Margaret A. Townley were made by the said Hugh C. Townley and received by the said Margaret A. Townley, having full knowledge of the insolvency of the Eureka Chemical Company, for the purpose of enabling the said Margaret A. Townley to obtain a judgment and lien upon the property of the Eureka Chemical Company, and for the purpose of avoiding and evading the statute providing that whenever an incorporated company shall have refused the payment of any of its notes or otlier evidences of debt in specie or lawful money of the United States, it shall not be lawful for such company or any of its officers to assign or transfer any of the property or choses in action of such company to any officer or stockholder of such company, directly or indirectly, for the payment of any debt, and to avoid the decisions of the courts under such statute, and to create and obtain an illegal preference over the plaintiff and other creditors of the said defendant, the Eureka Chemical Company.”

      Louis Marshall and William 8. Jenney, for the appellants.

      A. IT. Sawyer, for the respondent.
   Per Curiam: :

Plaintiff having recovered a judgment against the Eureka Chemical Company, brings this action on the equity side of the court to obtain relief. The plaintiff alleges the invalidity of the judgments recovered by Margaret A. Townley, and asks the intervention of the court through the instrumentality of its equity powers. (Braem v. The Merchants' National Bank of Syracuse, 127 N. Y. 509.)

Section 4 of title 4 of chapter 18 of part 1 of the Revised Statutes was in force at the time of the occurrence of the transactions that are the subject of inquiry in this action. The evidence indicates that the corporation had refused payment of its notes or debts prior to the commencement of the actions by Margaret A. Townley, and, therefore, the prohibiting parts of the section were applicable to the corporation. That section of the Revised Statutes provides: “ It shall not be lawful for such company or any of its officers to assign or transfer any of the property or choses in action of such company to any officer or stockholder of such company, directly or indirectly, for the payment of any debt; and it shall not be lawful to make any transfer or assignment in contemplation of the insolvency to any person or persons whatever; and any such transfer and assignment to such officer, stockholder or other person, or in trust for them or their benefit shall be void.” (1 R. S. 603.) The evidence makes quite manifest the scheme of Hugh C. Townley to so transfer his indebtedness against the company to his wife as to enable her to obtain a preference which he could not by the letter of the statute have or receive. We .are called upon to determine whether such scheme can be successful or not. We think, under the construction that has authoritatively been given to the statute, that the efforts on the part of Hugh 0. Townley and Margaret A. Townley to gain a preference over the other creditors by the means adopted, should fail. (Kingsley v. First National Bank of Bath, 31 Hun, 329; Throop v. Hatch Lithographic Company, 58 id. 149; S. C. affd., 125 N. Y. 530.) While that case was under consideration in the General Term of the first depai’tment it was said : It seems to have been the intention of the Legislature to prevent persons occupying confidential relations towards corporations from either directly or indirectly profiting by the information which they may have acquired because of their relation to the corporation, and which information they could use to the detriment of the general creditors of the corporation.”

In National Broadway Bank v. Wessell Metal Company (59 Hun, 479) the scheme pursued was condemned on the ground that unlawful means were used to effect a forbidden end. The means adopted in that case which were condemned, consisted of a collusively confessed judgment and a collusive execution issued as a sham and returned as a sham, followed by sequestration proceedings founded upon these shams, instituted by the defendant company against itself through its own counsel, all to effect the end of a practical transfer by the directors themselves.”

In the course of the opinion delivered in Throop v. Hatch Lithographic Company (125 N. Y. 531), ANdebws, J., said: The construction given below is salutary, and in many cases will prevent frauds upon the statute which could not be proved.” He then adverts to the question as it was presented and discussed in Kingsley v. First National Bank of Bath (31 Hun, 329), and approves the conclusion there reached. He further adds: “We think a construction which disables an officer of an insolvent corporation from acquiring a preferential lien on the corporate assets by legal process is justified.”

In the case in hand we have the effort on the part of an officer who had full knowledge of the insolvency of the corporation, to so transfer his claims to his wife, who is found to have had equal knowledge of the insolvency of the corporation, in order to circumvent the letter of the statute. The scheme was condemned "by the Special Term, and the trial judge expressed his views in respect to the same in an opinion wliicli is found in the appeal booh, in language which meets with our approval.

The force of the opinion of the Special Term and the views already expressed lead to the conclusion that the judgment should be affirmed.

MeewiN and PaeKee, JJ., concurred.

Judgment affirmed, with costs.