author: By the Court.—Monell, Ch. J.

text:
    CONRAD MEYER, Plaintiff and Respondent, v. JAMES CLARK, and others, Defendants and Appellants.
    /. ARREST, WITHOUT WARRANT OR PREGEPT.

    1. POLICE, POWER OE SO TO ARREST.

      (а) Excise law. Police have no power to arrest under it without a warrant, unless the party is actually engaged in violating its provisions at the time of the arrest {Laws 1857, p. 411, § 16.
    (б) Common law. Police can not for a breach of the peace or a simple misdemeanor, arrest an offender without a warrant, unless the arrest is made while he is engaged in the act constituting a breach of the peace or the misdemeanor.
    1. Violation of excise law in selling intoxicating liquors without a license is not a misdemeanor ; it is too low a grade to authorize an arrest at common law without a warrant after the offense has been committed.
    2. ACTUAL ENGAGEMENT, WHEN ARREST NOT MADE DURING.

      {a) Interval of time.
    1. When a policeman, after having seen a breach of the peace or a misdemeanor committed, departs, and afterwards returns, he can not arrest without warrant for such previous offense so committed in his view.
    1. The shortness of the interval does not affect the question.

      II. FALSE IMPRISONMENT.

    1. OFFENSE COMMITTED, BUT ARRESTING WITHOUT WARRANT.

      (a) Liability for. If a police officer arrest without a war- , rant in cases where he is not authorized so to do, he is liable in an action of false imprisonment for carnages, although the party arrested had committed the offense for which he arrested him, and that offense rendered him liable to arrest under a warrant.
    (5) Defense.
    1. Order of superior officer is not.

      Before Monell, Ch. J., and Sedgwick, J.

      Decided April 3, 1876.
    Appeal from an order. •
    The action was for false imprisonment.
    The complaint, setting forth the cause of action, was accompanied by the following affidavit of the plaintiff:
    “That while this plaintiff was quietly and peaceably attending to his business in his store, the defendant Burns entered the same, and after remaining a short time, demanded that this deponent should go with him to see the captain of the police force of the thirty-third police precinct, which deponent refused to do, and that said Burns without any power or authority continued to demand and insist that this deponent should go with him as a prisoner to the thirty-third precinct station-house, and did otherwise harass and annoy this deponent; and that deponent further refusing, the said Burns left, and returned between five and six o’clock in the evening, and in company with the other defendants, and they the said defendants, then and there in the store and premises of the said plaintiff, and without cause or legal right or process, compelled this deponent to leave and close up his store, and go with them in and along the public streets and avenues in said ward, to said station-house, and did then and there falsely, maliciously, and without cause or legal right so to do, imprison this deponent in a dark, cold, and damp cell, without food or drink of any kind for the space of fourteen hours thereafter.”
    Upon this affidavit the defendants were held to bail, each in the sum of one thousand dollars.
    The defendants moved at special term to vacate the order of arrest, when the defendant Byrnes made the following affidavit:
    “ That he is a member of the police force of the city of New York, to. wit, a patrolman thereon, attached and assigned to the thirty-third police precinct, of-and in said city of New York, under the orders and command of Henry Hedden, captain of police in and of said precinct, and that the defendants Clark and Reilly are likewise patrolmen of police of and in said precinct, and under said captain of police.
    “ That as a member of said police force, it became and was the duty of defendants to arrest all persons found guilty of selling intoxicating liquors without a proper license therefor. That on the eighth day of November, 1875, said Hedden, by special orders to this deponent, directed him to arrest all persons that he might find offending as aforesaid, and directed his » attention specially to the plaintiff among others; that this defendant obtained clear proof and positive evidence that the plaintiff was offending against the law in the respect aforesaid, and by the orders of said Hedden, and in the discharge of the positive duty prescribed by law of this deponent as a member of the police force as aforesaid, proceeded to arrest said plaintiff; but said plaintiff not acceding to the request of this deponent to accompany him peaceably to the station-house, this deponent reported to said Hedden, who required the other defendants to accompany this deponent, and require him to come to the station-house of the precinct; that the defendants thereupon without using any force or violence, constrained said plaintiff to accompany them to the station-house, where complaint was duly made to the officer at the desk, who caused said plaintiff to be detained until the next sitting of a police court; that at the next sitting of a police court, the said plaintiff was taken before a magistrate, and complaint duly made against him for the offense aforesaid ; and said magistrate did not discharge said plaintiff, and only released him upon his giving bail and security to answer said charge, but, on the contrary, held him to bail to answer said charge.
    The plaintiff in a counter affidavit stated : That when he was first interfered with it was in his store, where he was not then engaged in selling any liquor, but was so induced to do by the defendant Burns while said Burns was in citizen’s clothing, and after said Burns had drunk the liquor given him ; and deponent denies that he was then or is now selling, disposing of, or exposing for sale any liquor, ale, or beer without any legal license so to do.
    That when said Burns drunk said liquor, he in an angry manner demanded that deponent should go and see the police captain at the station-house about one half a mile distant, and deponent told him that if the captain desired to see him, he could call on deponent at his store, and the said Burns further insisting upon this deponent to go with him, and this deponent’s continued refusals so to do, the said Burns left the store, and in a few minutes returned with the said defendants Clarke and Beilly, and the said Clarke stating that he would take the responsibility thereupon, the other two defendants and said Clarke forceably took deponent to the said station-house, and kept him confined therein.
    The motion to vacate the order of arrest was denied, but the bail was reduced.
    The defendants appealed.

      C. F. McLean, for appellant.

      R. Oatis, for respondent.
   By the Court.—Monell, Ch. J.

This action is . for false imprisonment,, and not, as seems to have been supposed by the appellants’ counsel, for a malicious prosecution. The question of probable cause, therefore, is not involved (Burns v. Erben, 1 Robt. 555; affirmed, 40 N. Y. R. 463), and the complaint and affidavit of the plaintiff sufficiently show a cause of action and ground of arrest.

The cause of the arrest was an alleged violation of the excise, law of the State ; "and the arrest was made by the defendants, as policemen of the city, acting under the orders of the captain of the precinct. Such order was verbal, and the defendants had no-warrant from a magistrate.

Under the act to “suppress intemperance and to regulate the sale of intoxicating liquors ” (Laws 1857, chap. 628, p. 405), it is provided (§ 16, p. 411) that it shall be the duty of certain named officers, including ;policemen, to arrest all persons found actually engaged in the commission of any offense in violation of the act, and' forthwith to carry such person before any magistrate of the city, to be dealt with according to the provisions of the act.

It appears in this case that Byrnes, one of the defendants, having found the plaintiff actually engaged in the commission of an offense, i. e., selling intoxicating liquors without having obtained a license therefor, reported the case to the captain of the precinct, who required the other defendants to accompany Byrnes, to assist him. Thereupon the defendants took the plaintiff to the station-house, where he was detained until the next sitting of a police court. The interval between the time when the plaintiff was found by Byrnes committing the offense, and the arrest, was, as the plaintiff states it, only a few minutes.

But, having requested the plaintiff to accompany him to the station-house, and he refusing, Byrnes left and afterwards returned with the other defendants, and made the arrest.

It is not necessary, I think, upon this appeal, to determine whether an offense against the excise law had or had not actually been committed, nor whether the means resorted to to procure the evidence of its commission should be regarded with favor towards the defendants. We must assume that enough appeared to authorize the arrest, if the officers have acted within the power conferred upon them by law.

So far as the power is given by the excise statute, it is confined to persons found actually engaged in the commission of an offense. If, therefore, a person is found to be offending, he may, while so offending, be arrested without precept or warrant, and taken before a magistrate.

The common law right to arrest without a warrant, in the cases, in which it is given to a citizen as well as to magistrates and ministerial officers, is confined to the time when the offense was committed. And whether an offense had been committed or not, an arrest can not be made afterwards without a warrant (McKay’s case. 5 City H. Rec. 95). It is not essential to notice the difference between the right of a citizen and of an officer—which is chiefly that the former must act upon his own information, and that the latter may act upon the information of others, as well as the power of the latter to command assistance—in either case, the right to arrest must be exercised at the time the offense is committed. If there is an interval of time, then there must be a magistrate’s warrant (1 Chit. Crim. Law, 20, 21). Thus if an affray be made to the breach of the peace, any person without a warrant may restrain any of the offenders in order to preserve the peace ; but after there is an end of the affray, they can not be arrested without a warrant (Phillipps v. Trull, 11 J. R. 487).

But ministerial officers may, without warrant, make arrests, when there is reason to believe a felony has been committed, even though one has not been committed, and the arrest is made afterwards. A citizen, who under such circumstances should make an arrest, would not be protected (1 Chit. Crim. L. 20, 21, 22; Holley Mix, 3 Wend. 350 ; Slater v. Wood, 9 Bosw. 15, 26).

In the higher crimes, such as treason, felony, and some misdemeanors, an officer, upon probable cause and sufficient information that a crime has been committed, has a larger power than in cases of lesser degree. He does not need the authority of a warrant, but may arrest without one even after the time when the supposed offense was committed •, and is protected even though no crime had in fact been committed.

But in breaches of the peace and simple misdemeanors, an officer, no more than a citizen, can without a warrant arrest an offender, unless it is done while the offender is engaged in the act constituting the breach of the peace or the misdemeanor (1 Chit. Crim. L. 23 ; 2 Esp. Rep. 540 ; 1 East P. C. 305).

The excise law attaches a penalty of fifty dollars for each offense of selling intoxicating liquors without a license. The offense is not made a misdemeanor, and is of too low a grade, even if it can be called an offense, to bring it within any of the recognized cases where arrests can be made without a warrant, after the offense has been committed.

I do not regard the shortness of the intervening time, between the commission of the offense and the arrest, as affecting the question of the officer’s right. If a short interval continues the right, a longer interval would also, and courts or juries would have to measure degrees of time in determining the rights of parties. And the protection of individuals from arbitrary arrest, will be better secured by requiring a complaint and a magistrate’s warrant in all cases of arrest not literally within the letter of the law.

In the case before us we can see no necessity for making the arrest in the manner it was done. The penalty is a money fine only, and there was no probable danger of an escape of the offender. If there was time to report the case to the captain of the precinct, there was time, or time should have been made, to obtain from a magistrate a warrant. And the practice—• if to any extent it exists—of using official power where the law does not confer it, can not be too greatly deprecated and condemned. The liberty of the citizen is too sacred to be lightly or causelessly interfered with ; and the officers of police, however necessary and valuable they may be as conservators of order and in the enforcement of law, must keep themselves within the limits of the law, and not assume functions unless given in the law.

That the defendants acted under and in pursuance of the orders of the captain of the precinct, does not relieve them from responsibility for their act. Neither they nor the captain could make the arrest without a warrant. ,

Upon all the facts before us, I am of the opinion that the defendants were trespassers, and liable to arrest under the 179th section of the Code.

The order should be affirmed with costs and disbursements.

Sedgwick, J., concurred.


source: Caselaw Access Project

license: Public Domain

text:
    GEORGE W. T. LORD, and others, Plaintiffs and Appellants, v. LUCAS THOMPSON, Defendant and Respondent.
    Before Monell, Ch. J., and Sedgwick, J.

      Decided April 3, 1876.

      HUSBAND AND WIFE.

    1. LIABILITY OF HUSBAND FOR GOODS SOLD HIS WIFE ON CREDIT.
    (a) Necbssabies, liable thebefob.
    He is liable for articles necessary for her use which he neglects or refuses to supply.
    (J) Defences to action fob, what abe not, in such case.
    1. Notice not to sell on his credit, is not.
    3. Limited divorce; suit for pending, and report of referee fixing alimony, but not confirmed, are not.

      (a) Subsequent confirmation of the report and payment of the alimony will pot relate baclc so as to affect the rights of one who had previously furnished necessaries.
    8. Offer by husband to supply is not, if connected with conditions which the wife is not bound to comply with.
    4. Previous provision by husband, is not, if the husband on separation withheld from the wife that which he had provided.
    Action to recover for goods sold and delivered.
    Appeal from judgment dismissing the complaint.
    The complaint alleged a sale and delivery to the defendant of goods, &c., and a promise by the defendant to pay, &c

      The answer was a general denial.
    The action was tried by the court and a jury.
    The plaintiffs proved that the defendant’s wife in August and September, 1873, purchased of the plaintiffs certain goods, consisting of female wearing apparel.
    Previous to such delivery an action for separation between the defendant and his wife had been begun by the latter, and was pending, and a reference was had to ascertain and report a suitable sum as alimony. The referee had made his report, awarding $50 a week, but no part of it had been paid. The defendant had given written notice to the plaintiffs not to furnish any goods to his wife on his, the defendant’s, credit.
    The goods in question were sold on the credit of the defendant, although charged upon the plaintiffs’ books to defendant’s wife, and there was no question but.that they were suitable and proper as respects quality and quantity.
    The only questions were, whether they were “necessaries,” and whether the defendant could, under the other facts and circumstances proved, be held responsible.
    The defendant’s wife testified that she separated from the defendant, her husband, in August, 1873. In answer to the request to state the circumstances under which she purchased the goods, she said, “I had an order of separation from the court granted rae, and I was getting ready to leave my husband’s residence, to take up my own residence, and was waiting for the decree of the referee—the referee was to decide how much I was to have—but the conduct of my husband and the servants in the house, was so violent that I was obliged to leave before I was really ready, and had the money; and while I was packing up my clothes to take them away with me, my husband came in, stopped the packing, would not allow me to take anything away with me at all, and I was afraid to stay in the house, because his conduct was so violent. I had taken off my good dress and put on my old dress to pack in, therefore I left in my old clothes, and my walking clothes and my hat in my hand. I was not allowed to bring anything out, and I left without taking anything at all; and the next day or the day after, I went back and tried to get some of my clothes, and the house was locked, and he had placed somebody there to prevent my getting in, and he would not allow me to have my clothes at all.
    “ At the time of the purchase, I had the clothes upon me just that I came out of the house with. I, some time after—about the end of October of that year —recovered, through an order of the court, my wardrobe. At the time of the purchase, I had as clothing simply that which I walked out of the house with. I had nothing else: At that time I was not in the receipt of any money from the defendant.”
    The witness further testified that the defendant had proposed, through her attorney, that witness should go into the basement, of the house, and pack up her clothes, while he was watching what she packed up, and that she could not go into any other room whatever, to see the children or anything, only just in the basement. And she asked permission to go and pack up her own wardrobe and her own things—that she considered her own. He had taken out things from her trunk; pieces of silk, of muslin, trimmings, laces and books, and had left nothing therein ; just the mere dresses.
    The letter containing the answer to this proposal was put in evidence by the defendant. It was addressed to the defendant’s attorneys, and is as follows:—■
    Mrs. Thompson proposed to go to the house, and, with her seamstress, pack and remove her wardrobe, leaving every article disputed or claimed by Mr. Thompson, to await the adjudication of the court.
    He refuses, and insists that she may come into the front basement, agreeing not to go into any other room, and come alone at that, and pack such things as he may allow her, and leave. In case she would not consent to that, he agrees to pack up and send to her at any address, what he chooses to call her wardrobe.
    This he agrees to after she has been turned out of the house, and forbidden to return, and refused admission for over one week, and without a change of clothes during that time. She also demanded to see her children, and was refused by the person left in charge by Mr. Thompson, at the house.
    She will accept neither of the propositions, but adheres to her demand of last week.”
    Defendant moved for a non-suit, on the ground that the credit was given to the wife of the defendant after the plaintiffs had received notice from the defendant to furnish no goods to his wife on the credit of defendant.
    Also, on the ground that there is no evidence sufficient to go to the jury, as the plaintiffs have failed to show (such notice not to trust having been given) that the goods in question were necessaries.
    The motion was granted and the complaint dismissed. The plaintiffs excepted, and appealed from the j udgment.

      A. H. Holmes, for appellant, urged :
    I. The husband is liable for price of goods sold his wife on his credit, after notice not to furnish goods on the husband’s credit, provided the goods were necessaries, suitable to the wife’s condition in life, and the husband failed to provide them (Theriott v. Bagioli, 9 Bosw. 578 ; Ogden v. Prentice, 33 Barb. 160 ; Cromwell v. Benjamin, 41
      Ib. 558 ; 2 Smith’s Leading Cases, 440 ; 2 Kent’s Com. 146, 147, and 148; Bright on Husband and Wife, vol. 2, p. 7).
    II. 1. The questions whether the goods were necessaries, suitable to the wife’s condition in life (the wife’s destitution), and the failure of the husband to provide them, were questions of fact for the jury, and should have been submitted to the jury (Theriott v. Bagioli, 9 Bosw. 578 ; Cromwell v. Benjamin, 41 Barb. 558 ; Brighton Husband and Wife, vol. 2, p. 8). 2. If there was legal evidence even tending to prove the affirmative of these questions, the plaintiffs were entitled to have them submitted to the jury ; but the evidence here not only tended to prove the affirmative of these questions, but was abundant to support an affirmative finding (9 Wallace Supreme Court [ U. S] 197; 17 Wallace Supreme Court [ U. S.] 657.) 3. The destitution of the wife, and the fact that the goods in question were necessaries, and suitable to her condition in life, is clearly shown. 4. The same evidence which proves the destitution and necessities of the wife, proves something more than the failure and neglect of the husband to provide for his wife’s needs : it proves Ms absolute and determined refusal to make needful provision for his wife when he knew that her destitution and need was the result of his own acts.

      Duer & Blayden, attorneys, and Wm. A. Duer, of counsel, for respondent, urged :
    I. A husband who provides Ms wife with necessaries is not liable to tradesmen who furnished goods to her (Cromwell v. Benjamin, 41 Barb. 558). The defendant had provided for his wife a large amount of wearing apparel. Where a husband provides his wife who lives apart from him, it is incumbent upon one who has been expressly forbidden to give her credit, in order to render the hus band liable, to show affirmatively that he did not supply her with necessaries (Mott v. Comstock, 8 Wend. 544 ; Theriott v. Bagioli, 9 Bosw. 578).

    II. Where the wife has a separate maintenance, and the husband pays it, he is not liable even for necessaries (Baker v. Barney, 8 Johns. 72). At the time these goods were furnished to Mrs. Thompson she had a separate maintenance. The goods were sold on August 30, and September 2. Mrs. Thompson had brought suit against her husband for a limited divorce—it had been referred to a referee to ascertain the amount of alimony to be awarded to her—the referee had made this report, and immediately upon its confirmation Mrs., Thompson had received alimony at the rate of, $50 a week from the time the referee made his report.
    III. In addition to this separate maintenance of $50 a week, Mr. Thompson did all in his power to send to his wife all the clothing which she had left behind her when she went away. He offered to send her trunks to any address she might give him—and the trunks contained Mrs. Thompson’s wearing apparel.
   By the Court.—Monell, Ch. J.

The written notice from the defendant to the plaintiffs not to furnish ' goods to’his wife on his credit, absolves him from lia- , bility for the goods in question, unless they fall under-the denomination of “necessaries,” which, notwithstanding the position of the marital relation of the d - - fendant and his wife, existing at the time, he was bmnd to furnish.

At the time the goods were furnished, an action on behalf of his wife for a limited divorce was pending, against the defendant. In it a reference had been made to ascertain what would be a suitable amount of temporary alimony, and the referee’s report, fixing the sum at fifty dollars a week, had been made, but- had not been confirmed, nor had any money been paid - on account thereof. The referee’s report was subsequently confirmed, and the alimony paid. But at the time the goods were purchased, no separate maintenance had been provided by the defendant: and whatever was subsequently done or paid, cannot have relation back so as to affect or prejudice the legal rights of the plaintiffs. '

There was, therefore, nothing in the situation of the divorce suit or of its proceedings at the time the goods were purchased, to wholly relieve the defendant from liability. She was stiilo his wife, and a sale to her of articles necessary for her use, which her husband had neglected or refused to supply, would impose the obligation of payment on him.

There was some evidence that he, a short time previously—between January and June, 1873—had furnished his wife with goods and wearing apparel, amounting to more than a thousand dollars. That fact, if it stood alone, would cast a heavy burthen upon the plaintiffs, and require them to.show that the goods in quest on were not alone “ necessary,” but that her husband had refused or neglected to furnish his wife with them. But it appears, without contradiction, that when the defendant’s wife 1 -ft his house, he refused to allow her to take w th he ; ny of her we v ng apparel and toilet articles, and she was obliged to leave with only the dress she had on. And the subsequent offer to restore her wardrobe, or a part of it, was made upon conditions which she was not bound o acc \ t.

Upon the whole case, therefore, there was enough to establish that the goods sold and delivered to the defendant’s wife were “ necessaries,” which he had refused and neglected to furnish; and I think the plaintiffs, upon that showing, were entitled to recover.

Th-> judgment dismissing the complaint should 1 e reversed and a new trial granted, with, costs to the appellants to abide the event.

Sedgwick, J., concurred.


text:
    JAMES LAWRENCE and others, Plaintiffs and Appellants, v. STEPHEN CABOT and others, Defendants and Respondents.
    f. PLEADINGS, G ON STRUG T1 ON OF, ADMISSION BT.

    1. DENIAL CONTAINED IN AN ANSWER.
    (a) Negative pbegnant, a denial amounting to, is an admission of the allegation in reference to which it is made.

      (b) Affirmative Allegation accompanying such a denial. 1. The burthen, of proving it rests on the defendant.

      (a) The plaintiff may take the admission and leave it to the defendant to establish the avoidance set up by the affirmative allegation.

    (c) Instances.
    The above action was brought to recover damages for false representations as to the credit of a third party (B.). The complaint alleged that in a previous action brought in the marine court, by the defendant against the plaintiff to recover broker's commissions on certain sales effected by him (the then plaintiff), for the then defendant, and among them sales to B., the plaintiff, being then defendant, in answer admitted a certain sum to be due; but as to the sales to B., set up certain false representations, made by the plaintiff, in that, being the defendant in this action (the same being set up in that answer substantially as in the complaint in this), that said action was tried, and the only question litigated was the then plaintiff’s right to brokerage on the sales to B.; and the jury gave the then plaintiff a verdict for the amount admitted to be due and no more, disallowing his claim for brokerage on the sales to B. Whereupon judgment was entered pursuant to the verdict; the answer denied that the only question tried in the marine court action, was the indebtedness for brokerage on sales to B., and alleged that the question of plaintiffs’ right to damages for the alleged fraud was also tried, and that the marine court judgment was a bar to this action.
    Before Monell, Ch. J., and Sedgwick, J.
    Decided, April 3, 1876.
    Held,
    1. The denial was a negative pregnant, and admitted the facts alleged in the complaint, which facts established that the only question litigated in the marine court was this defendant’s fraud, and that that question was disposed of against this defendant.
    2. The plaintiff had a right to take the admission without being bound by the affirmative allegation.
    (a) It devolved on defendant to prove his affirmations.
    II. JUDGMENTS. Estoppel.
    1. PAROL EVIDENCE AS TO; when admissible to show whether a certain question was litigated on the trial resulting in the judgment, so as to raise an estoppel.

    1. When the record only shows that the questions may have been litigated. <

    2. Application.
    In this case
    Held,
    1. Evidence aliunde the judgment roll was admissible to show that the question of fraud involved in this action was litigated and determined in the marine court action.
    2. The stenographer’s minutes established this fact.
    3. That the judgment roll, when offered in conjunction with the stenographer’s minutes, was admissible.
    4. If admitted it would have established plaintiff’s cause of action, and been conclusive on the defendant. Its exclusion was error.
    Appeal from a judgment dismissing the complaint.
    The complaint alleged that the defendants, with in tent to deceive and defraud the plaintiffs, falsely and fraudulently represented to them, that certain persons composing the firm of Osborne, Bullard & Co., were solvent and safe to be trusted : that they were pecuniarily amply responsible for all their debts: . . . That they, the defendants, knew said firm to he good, solvent and safe to be trusted, and amply responsible for and able to pay their debts, and able to pay for such goods as plaintiffs should sell them. That the plaintiffs, relying upon such representations, sold said firm goods, &c., to the amount of twelve and upwards of thousands of dollars, of which over five thousand dollars is unpaid. That the defendants knew their said representations were false; and knew said firm was insolvent, and unable to pay their just debts, &c.
    By reason whereof the plaintiffs have sustained damages.
    There was a general denial by the defendants.
    The plaintiffs, in a supplemental complaint, alleged that subsequent to the commencement of the action, the defendants commenced an action against the plaintiffs in the Marine Court of this city, to recover, among other things, the value of their services as brokers in selling the said goods to Osborne, Bullard & Co. That the plaintiffs in their answer alleged the said false representations of the defendant. That such action was tried, and the only question litigated therein, was, the defendants’ right to brokerage, upon said sales to Osborne, Bullard & Co., which question was determined adversely to the defendants, and judgment was entered thereupon.
    The defendants, in their answer to the supplemental complaint, denied that the only question tried before the justice and jury of the marine court on the trial of the action in said court mentioned in said supplemental complaint was the alleged indebtedness of the plaintiffs to the defendants in this action for the services of the said defendants i procuring the sales to Osborne, Bullard & Company mentioned in the complaint and supplemental comp lint herein :
    And they say, that the question of the right of the plaintiffs herein to damages for the alleged frauds of the defendants herein as set forth in the complaint herein, was also tried on the said trial in the said marine court, and that the verdict and judgment in said action in the marine court is consequently a bar against the further prosecution of this action.
    The plaintiffs offered to read in evidence the judgment roll in the marine court suit. It was objected to and excluded by the court. They also offered to read the stenographer’s minutes of the testimony and proceedings on the trial in the marine court, which was objected to and excluded ; but afterwards was allowed to be read as being the shorthand writer’s minutes of that trial.
    The plaintiffs claimed that the record and proceedings in the action in the marine court, established that the only question litigated in that action was the false representations set up in the plaintiffs’ answer; ami that the judgment in that court upon such question, was binding and conclusive to establish the fraud in this action.
    The court dismissed the complaint and the plain tiffs appealed.

      Mathew Daly, attorney and T. R. Coudert, of counsel, for appellants, urged.
    I. The learned justice erred in refusing to admit the judgment roll in evidence. The effect of a judgment, under circumstances like the present, has been the subject of repeated adjudications, and the rule is so wel: settled that discussion seems idle. “The judgment of a court of competent jurisdiction upon a point litigated between the parties is conclusive in all subsequent controversies, when the same matter cernes directly in question ” (Demarest v. Dorg, 32 N. Y. 281; Williams v. Fitzhugh, 44 Barb. 321; White v. Merritt, 7 N. Y. 355; Gates v. Preston, 41 N. Y. 113).
    II. There was error in the exclusion of the parol evidence as to the grounds on which the marine court judgment was rendered. Parol evidence may be received to show the grounds upon which a judgment was rendered'where the grounds of the judgment do not fully appear from the record, provided that the matters alleged to have been passed upon are such as could legally have been given in evidence on the trial, and that the verdict and judgment show that they must necessarily have been considered by the court and jury (Wood v. Jackson, 8 Wendell, 9 ; Stedman v. Patchin, 34 Barb. 218 ; Kerr v. Hays, 35 N. Y. 331; White v. Madison, 26 N. Y. 117; Doty v. Brown, 4 Comst. 71; Wilcox v. Lee, 1 Robt. 355 ; Harris v. Harris, 36 Barb. 94). “The general rule on this subject is well known to be, that a former judgment of the same court, or of a court of concurrent jurisdiction, directly upon the point in issue, is, as a plea in bar or as evidence, conclusive between the same parties, or others claiming under them, upon the same matter directly in question in a subsequent action or proceeding. (Gardner v. Buckbee, 3 Cowen, 120 ; Burt v. Sternburgh, 4 Id. 559 ; Wood v. Jackson, 8 Wend. 9 ; Etheridge v. Osborn, 12 Id. 399 ; Embury v. Conner, 3 Comst. 511 ; Doty v. Brown, 4 Id. 71; Ehle v. Bingham, 7 Barb. 494; Kingsland v. Spalding, 3 Barb. Ch. 341). Such judgment or adjudication is final and conclusive, not only as to the matter actually determined, but as to every other matter which the parties might have litigated and have had decided, as incident to or essentially connected with the subject matter of the litigation, and every matter coming within the legitimate purview of the original action both in respecfc to matters of claim and of defense (Bronen v. Hone, 2 Barb. 586 ; Embury v. Conner, 9 Comst. 511, 522 ; Haire v. Baker, 1 Seld. 357; Davis v. Tallcot, 2 Kern. 184; Hays v. Reese, 34 Barb. 156).” “Insome cases, for example, where the grounds upon which the judgment proceeded do not appear from the record itself, and where, from the record itself, it cannot be determined whether a particular claim or security was involved in the litigation, it is competent to prove the same by parol testimony, provided they be such as might have been given legitimately in evidence under the issue, and must have been directly and necessarily in question as the grounds of the verdict (Wood v. Jackson, 8 Wend. 9 ; Lawrence v. Hunt, 10 Id. 80 ; McKnight v. Dunlop, 4 Barb. 36, 44 ; Young v. Rummell, 2 Hill, 481 ; Dunckel v. Wiles, 1 Kern. 420; Vought v. Winch, 2 B. & Ald. 668 ; Outran v. Morewood, 3 East, 345; Gray v. Purguy, 17 Verm. 419-423.
    III. But were we to waive the benefit of exceptions, the soundness of which is established by an unbroken current of authoritative decisions, there would still remain another fatal objection, to which the attention of this court should be called. The answer to the supplemental complaint admits everything necessary to sustain an action, except the amount of damages. On this point, however, our proof is uncontradicted. A bare inspection of the pleadings must satisfy the court of the sufficiency of this objection.

      Edward B. Merrill, attorney, and James C. Carter, of counsel, for respondents, urged :
    I. In determining whether a former judgment is an estoppel, the pleadings in the two suits must first be examined, and if the very same question appears by the pleadings to be raised in both suits, the judgment in the first is conclusive upon the issue in the second. If, however, it only appears by the pleadings that the question at issue in the second suit may have been raised in the first, there is no estoppel, unless the party alleging the estoppel shows by competent evidence aliunde (and he is permitted to resort to such evidence) that it was in fact'raised and certainly decided in the first action. The elaborate notes of the American editors of Smith’s Leading Cases to the “Duchess of Kingston’s Case,” fully sustain the above views. They are familiar law. (Smith’s Leading Cases (Sixth Am. Ed.), 787, et seq. ; Davis v. Talcott, 2 Kern. 184 ; McDonald v. Christie, 43 Barb. 36).
    II. The first step, therefore, in order to ascertain whether the questions in the suit in the marine court were the same as those raised in the present case, is to inspect the pleadings in the two suits. It at once appears that, so far as the pleadings are concerned, the questions were different. (1.) In the suit in the marine court the plaintiffs (the defendants in this) alleged an indebtedness for certain items of brokerage amounting in the aggregate to $151.18. The answer admitted an indebtedness as to certain of the items amounting to $60.09. It then set forth that, as to the brokerage claimed on the sales to Osborne, Bullard & Company, such sales were induced by fraudulent representations on the part of Cabot, Bowles & Co., and “ that the full payment of Osborne, Bullard & Co., was, and is, a condition precedent to any payment of brokerage or commisions to plaintiffs (Cabot, Bowles & Co.) on such sales f and that Osborne, Bullard & Company were insolvent, and a large part of the price of the goods remained unpaid. The answer further set up a counter-claim for goods sold to the amount of twenty-one dollars. The reply denied in substance all the allegations of the answer. Upon these pleadings the following matters of fact were put at issue. First. Whether Henry Lawrence & Sons were indebted to Cabot. Bowles & Co. for the several items of brokerage not admitted by the answer on sales to other parties than Osborne, Bullard & Company. Second. Whether Cabot, Bowles & Company were guilty of the false representations alleged. Third. Whether, by the contract under which Cabot, Bowles & Company acted as brokers in making the sales to Osborne, Bullard & Company, full payment by the latter firm was a condition precedent to the payment of brokerage or commissions to Cabot, Bowles & Company. Fourth. Whether Henry Lawrence & Sons made to Cabot, Bowles & Company the sale set up by the counter-claim in the answer. (2.) We need go no further than the above statement to show that a verdict and judgment on these four issues could not, by any possibility, be an estoppel in the present action. It would be impossible to tell upon what grounds the jury proceeded; and it would even be possible that some of the jury proceeded upon one ground and some upon another.
    III. It follows, from the above, that the judgment roll in the suit in the marine court was properly excluded, and the exception .to such exclusion was not. well taken.
    IV. The effort of the plaintiffs’ counsel to show, by parol evidence, what did not appear on the face of the judgment-roll, namely, that the questions in this suit were adjudged and determined in the suit in the marine court, was wholly unsuccessful. (1.) The opinion of the plaintiffs’ attorney was manifestly inadmissibl , and the rulings of the court repelling this were correct. (2.) Ho evidence was given to show that the stenographer’s minutes were a full and correct report of the testimony and proceedings. In the absence of such proof the court was without knowledge of what such testimony and proceedings were, and no advance was made towards proving with any greater certainty than that afforded by the pleadings themselves, what the real questions litigated and determined were.
    V. Upon inspecting the answer in the suit in the marine court, it is somewhat difficult to determine which of the two cases above described the pleader intended to set up in his answer. The allegations of fraud point to the first. The allegation of a condition precedent points to the second. The .judge, however, in his charge, plainly treated it as a case of the second description. His emphatic declarations in the beginning of his charge, that the brokers stood in confidential relations to their principal, leave no doubt on this point.
    VI. A verdict and judgment can never establish anything more than is necessary to support them ; and all that was necessary to support them in the suit in the marine court was a finding that the brokers stood in confidential relations to the sellers, were bound to give their principal the benefit of their best judgment and discretion in finding a responsible purchaser, and failed to discharge this obligation.
    VII. No argument is necessary to show that such a determination does not establish for the plaintiffs the issue in the present action. That issue is, that the defendants, standing as strangers to the plaintiffs, committed a fraud upon them, entitling the plaintiffs to affirmative damages.
    VIII. If the preceding views are well founded, they effectually dispose of the only authority which the plaintiffs can cite to maintain this action. A physician, in suing for his compensation, is bound, affirmatively, to show the exercise of care and skill. The defeat of his action is an adjudication of the failure to, exercise such care and slcill. And such failure necessarily carries with it liability on his part for the damages sustained thereby (Gates v. Preston, 41 N. Y. 113 ; Bellinger v. Cragie, 31 Barb. 534; Edwards v.
      Stewart, 15 Id. 76). He also contended that the stenographer’s minutes failed to show that the question determined in the marine court was the saíne as that raised in this action.
   By the Court.—Monell, Ch. J.

I think it quite clear that one of the issues raised by the pleadings in the marine court suit, was the fraudulent representations which are made the grammen of the action in this court.

The defendants—who were plaintiffs in that court— brought their action to recover, as the plaintiffs’ brokers, for services in effecting sales of ‘1 bagging,” to sundry persons and firms, including the firm of Osborne, Bullard & Co. The amount claimed upon sales, other than to Osborne, Bullard & Co., was ninety dollars and fifty-three cents, and upon sales to the latter firm, sixty dollars and sixty-five cents.

The plaintiffs in their answer in the marine court, admitted the claim to the extent of sixty-one dollars eighty-nine cents, for brokerage, other than upon sales to O. B. Co., and as to the claim for brokerage upon sales to that firm, the plaintiffs alleged the false representations, substantially as they are alleged in their complaint in this action;—and then proceeded as follows: “ That without said representations defendants would not have made s.uch sale, and that the full payment by said Osborne, Bullard & Company was and is a condition precedent to any payment of brokerage or commissions to plaintiffs on such sale. That said Osborne, Bullard & Company were at the time of said representations and sale, and still are insolvent, not safe to be trusted, not able to pay their debts and unable to pay for said goods; all which plaintiffs well knew at the time of said representations, and that plaintiffs well knew said representations to be false and made same with intent to cheat and defraud these" defen dan ts. That a great portion of the value of said goods, to wit, the sum of five thousand seven hundred and fifty-two dollars and fifty-one cents, has not been paid.

And these defendants further answering deny each and every allegation in the complaint not hereinbefore admitted. The answer also set up a contradiction ; to which there was a reply.

It appears, I think, very distinctly from the stenographer’s minutes of the trial of the marine court suit, that the only question litigated in that trial was the fraud alleged in the sales to Osborne, Bullard & Co. All the evidence on either side related to these sales. None whatever was given in respect to any of the sales not covered by the plaintiff’s admission, except the sales to Osborne, Bullard & Co. ; and the court presented no other question .or subject to the jury.

If the proof offered was competent, I see no reason to doubt that the only question litigated in the trial in the marine court, was the precise question involved in the action now before us.

Nor is there any doubt that by the verdict and judgment in that court, the issue was found against the present defendants and is conclusive upon them.

The objection to the judgment roll in the marine court action, was, that it was irrelevant and incompetent ; and the objection seems to have been sustained on those grounds.

As the judgment roll is not printed in the case, we do not know to what extent it would show an adjudication upon the questions raised by the pleadings in that action; and we must rely, therefore, upon the pleadings in this action, and the proof furnished of the issues then tried.

The pleadings in that suit are in the case, but they do not show that the only issue was the fraud. Three items of brokerage, besides the Osborne, Bullard & Co. sales, are not admitted, and may have been litigated on the trial.

But the complaint in this action, after alleging that, the only question tried in the marine court suit, was the alleged indebtedness of these plaintiffs for the services of those defendants in procuring the sales to Osborne, Bullard & Co. avers, that the jury gave these defendants a verdict for the amount admitted to be due and no more, and “disallowing said claim of the defendants for brokerage on the said sale of goods to O. B. & Co.” “ Wherefore judgment was entered pursuant to said verdict.”

The answer to the complaint denied that the only question tried in the marine court suit, was the alleged indebtedness for services in procuring sales to O. B. & Co. ; and the defendants say, that the question of the right of the plaintiffs to damages for the alleged frauds, was also tried.

The denial in the answer amounts to an admission that the question of plaintiffs’ indebtedness upon the sales to O. B. & Co., was tried and disposed of in the marine court áuit: the denial going only to the extent, that it was not the only question tried, but that the plaintiffs’ right to damages, was also tried.

The plaintiffs have the right to take the part of the admission which favors their case, and leave the avoidance to be established by the defendants.

Sufficient appears, therefore, I think, from the pleadings, to establish the fact that the only question litigated in the marine court suit was the fraud of the defendants, and that the question was disposed of by the judgment of the court in that case, against the defendants.

The allegation that the plaintiffs’ right to damages was also tried, is not sustained by any proof. JSTo claim to damages was made by the pleadings, and none appears to have' beun made on the trial.

The offer to prove by parol what subject was litigated in the marine court suit, was an offer made in conjunction with the offer to prove the judgment, and to show that the question of fraud involved in this, was litigated and disposed of in that action.

With such proof it would have rendered the judgment conclusive upon the defendants upon the question here litigated.

That such proof was competent was decided in Kerr v. Hays (35 N. Y. 331), where it was offered to prove aliunde the record, what was litigated and necessarily passed upon by the verdict: and the proof was held to be competent (White v. Madison, 26 N. Y. 117).

It was error, therefore, to exclude the offered evidence.

The accuracy of the stenographic report of the trial, although questioned and objected to by the defendants, when they were first offered, does not seem subsequently to have been insisted upon, and was substantially waived at the close of the trial. They were, therefore, before the court to be used to give effect to the judgment. When the judgment' roll was again offered, the court had before it sufficient proof that the judgment covered the precise question then in litigation, and I can see no reason why it was not thereby made material and competent.

Had the judgment roll been admitted it would have established the plaintiffs’ cause of action, and been con. elusive upon the defendants (White v. Merrill, 7 N. Y. 355; Demarest v. Dorg, 32 Id. 281 ; Gates v. Preston, 41 Id. 113).

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

Sedgwick, J., concurred.


text:
    THOMAS A. MOREHOUSE and WILLIAM E. DUDLEY, Plaintiffs and Respondents v. ISRAEL YEAGER, Defendant and Appellant.
    I. PRACTICE.

    1. APPEAL BOOK CONTAINING NONE OP THE EVIDENCE.
    Í. Effect of., as to consideration of requests to charge by the General Term.

    1. It will be assumed by the General Term that there was no evidence upon which the jury might have found in favor of the requesting party upon any of the requests.
    1. Therefore, in such case, the General Term, will regard . the requests as mere abstract propositions of lato which it is not called on to examine or decide.

    H. FRAUDULENT REPRESENTATIONS.

    I. ACTION FOR DAMAGES BY REASON.OF. a. "Necessary elements op ; falsity op the representations and intent to deceive.
    1. When intent to deceive not established.

      (a) HONEST BELIEF; when it appears that the defendant honestly believed in the truth of the false statement.
    1. This proposition (if there is sufficient evidence to carry the case to the jury upon it), may properly be cha/rged without any qualification.

    (5) Evidence as to honest belief.
    1. What sufficient to show its non-existence.

    If the defendant had information and knowledge of facts which in the exercise of common sense and ordinary prudence, were sufficient to put him on inquiry, and would have led him to the knowledge of the truth, he will be liable, the same as if he had actual knowledge. In such case he had not an honest belief in the truth of the false statement.

    1. This doctrine is established by Craig ®. Ward, 3 Keyes, 387.
    (c) Charge combining this last proposition with the one that if defendant honestly believed in the truth of the representation, the jury must find for him, is not erroneous; e. g.,
      one to the effect that if the jury found that defendant had no information or knowledge of such facts, as, &c., and honestly believed his representations to be true, they must find for the defendant.
    Before Monell, Ch. J., and Sedgwick, J.

      Decided, April 3, 1876.
    HI. Oraig p.--Ward, 3 Keyes, 387, commented on, and various authorities bearing on it reviewed, the result being that the case was declared binding on this court.
    Appeal from a judgment.
    The action was to recover damages for deceit in fraudulently representing the responsibility of one Stern.
    The action was tried by the court and a jury. None-of the evidence taken on the trial is given in the printed case.
    Exceptions were taken by the defendant to the charge of the judge, and also to his refusals to charge.
    The cause of action as alleged in the complaint was a conspiracy to defraud. It is alleged that the defendant combined with one Stern and one Heineman to cheat the plaintiffs; that by falsely representing Stern to be responsible, he induced the plaintiffs to sell to Stern certain cattle; that the defendant’s statements were false, and a device and contrivance to cheat the plaintiffs; that the defendant at the time knew Stern to be irresponsible and unworthy of credit; but relying upon the truth thereof, and being deceived thereby, the plaintiffs delivered the cattle to the defendant, receiving Stern’s check for the price thereof, which was at that time worthless ; and was made by Stern for the accommodation of the defendant, and for his benefit, and for the preconceived purpose of enabling the defendant to get possession of the cattle without paying for them, and to cheat the plaintiffs; that to consummate the fraud, the defendant represented to the plaintiffs that he well knew Stern’s financial condition, and could say positively, that he was solvent; that relying upon such statements, the cattle were delivered to the defendant, and. the check of Stern, post-dated some twenty days, received in payment; that the said statements were untrue, and were intended and known to be, by the defendant, at the time of making them, or that he had good reason to believe the same were, untrue ; that Stern was at that time insolvent, and that the said check was given without any intention of its being paid, Stern then having no funds in the bank to pay the same, or at any time since.
    It is then further alleged, that in the making and delivery of the checks, neither Stern nor the defendant ever expected them to be met and paid; that Stern suffered himself to be, and to be used as, a willing tool in the hands of the defendant, for the sole and express purpose of cheating and defrauding the plaintiffs out of their property in the cattle, and to the amount of the checks; and that the aforesaid statements, representations and declarations, by and on the part of the defendant, as to the pecuniary liability of Stern, the making and a delivery of said checks, together with the whole transaction thereinbefore set forth, was a device, a contrivance and a trick, unlawfully, wrongfully and fraudulently entered into, by and between Stern and the defendant, to carry out the said scheme, and for the purpose of cheating and defrauding the plaintiffs out of said cattle, to the amount of the said checks ; and by reason of which the plaintiffs wholly lost the said cattle, and have sustained an injury to the amount of two thousand two hundred and forty-two dollars.
    The court, among other things, charged the jury as follows : “If you believe that Stern and Heineman, or any one else, entered into a scheme to get the plaintiff’s cattle without paying for them, and the defendant Yeager came in, and aided them in the execution of such scheme, by making representations which were false, and which ought to have been known to him to be false, or which any reasonable man, situated as he was, would have known to be false, the plaintiffs are entitled to your verdict.”
    To which the defendant excepted.
    The several requests to charge were as follows:

      First. If at the time of making the representations in question, Stern was good and responsible, the jury must find for the defendant.
    The court declined to charge further or otherwise in this respect, than as it had already charged. To which refusal to charge, the defendant excepted.
    The defendant then requested the court to charge the jury: •

      Second. “ If the jury find that the defendant Yeager, at the time of making the alleged representations, on April 18, 1872, honestly believed that F. Stern was good and responsible, they must find for the defendant.”
    The court declined to charge further, or otherwise, in that respect, than it had already charged.
    To which refusal to charge the defendant excepted.
    The defendant then requested the court to charge the jury:

      Third. “ If the jury find that the representations so made by the defendant Yeager, as to the solvency or responsibility of F. Stern, were not made ip pursuance of any conspiracy, combination, or understanding between the said Yeager and the said Stern and Heine-man, or any other person, nor with intent to defraud the plaintiffs, they must find for the defendant.’ ’
    The court declined to charge further or otherwise in that respect than as it had already charged. To which refusal the defendant excepted,
    The counsel for the defendant then requested the court to charge the jury :

      Fourth. “That whatever statement Yeager may■ ha ve made to Morehouse on the 18th of April, 1872, as to the responsibility of F. Stern, was to be considered to have been made with reference to the transaction then being negotiated, and as to the responsibility of Stern for the amount for which Morehouse then proposed to give credit.”
    The court refused to charge further or otherwise in that respect than as it had already charged. To which refusal, the defendant excepted.
    The counsel for the defendant then requested the court to charge the jury :

      Fifth. “ If the j uvy find that the defendant Yeager, at the time of making the alleged representations or statements as to the credit or responsibility of F. Stern, honestly believed such statements or representations to be true, they must find for the defendant.”
    The court refused to charge further or otherwise in that respect than as it had already charged, and the defendant excepted to such refusal.
    In respect to the “second” and “fifth” requests to charge, the court, after reading them to the jury, added to and charged them with the following alterations or modifications, viz. : —
    “If you find that the defendant Yeager, at the time of making the alleged representations or statements as to the credit or responsibility of Stern, had no information or knowledge of facts which, in the exercise of common sense and ordinary prudence, was sufficient to put him on inquiry, and would have led to a knowledge of Falk Stern’s pecuniary condition, and of his en dit and pecuniary responsibility, and honestly believed such statements or representations to be true, you must find for the defendant.”
    “ Hence, it is for you to inquire whether the defend ant Yeager had such information or knowledge of facts from his intercourse with Falk Stern, and the surroundings of the case, as in exercise of common prudence and ordinary common sense was sufficient to put him on inquiry, and to have led to a knowledge of Fa.lk Stern’s pecuniary condition and his credit and responsibility at that time.”
    The defendant thereupon, at the close of the charge, requested the court to instruct the jury in the language or to the effect set forth in each of the above requests, which the judge refused to do, and the defendant excepted.
    The plaintiff had a verdict for the amount of the checks and interest, upon which judgment was entered, and from which the defendant appealed.

      Stilwell & Swain, attorneys, and B. M. Stilwell, of counsel for appellant, upon the propositions contained in the second general division of the head notes, urged :
    The question is therefore distinctly presented to the court, whether an action for damage can be maintained against a person who has, without fraud, made statements in regard to the credit of another, which statements he at the time honestly believed to be true, though such statements were in fact untrue, and the. person to whom the statements were made has suffered damage thereby. The modification made by the learned judge in the defendant’s request to charge, were made under the authority of the case of- Craig v. Ward (3 Keyes, p. 392), decided in March, 1867; the doctrine of that case has been reviewed and disapproved in numerous cases since, and this is not now an open ques tion in this State (Chester v. Comstock, 40 N. Y. 575, decided by the Court of Appeals in March, 1869 ; Paisley v. Freeman, 3 T. R. 5 ; Addington v. Allen, 11 Wend. 374. In Marsh v. Falker (40 N. Y. 565), decided in June, 1869, the doctrine of Chester v. Coin-stock was approved to its full extent. The head note of the case reads: “False representations as to the solvency or pecuniary condition of another, to be actionable as fraudulent, must at the time have been known to have been false, by the party making them ; or he must have assumed, or intended to convey the impression, that he had actual knowledge of their truth, though conscious that he had no such knowledge.” In Oberlander v. Speiss (45 N. Y. 175), decided Dec., 1870, it was held that “an action founded upon the deceit and fraud of the defendant cannot be maintained in the absence of proof that he believed, or had reason to believe, at the time he made them, that the representations made by him were false, and that they were therefore fraudulently made.” But when that case was cited in the Court of Appeals, in Meyer v. Amidon (45 N. Y. 170), decided in March, 1871, the court declared that Oberlander v. Speiss, must be read in connection with Marsh v. Falker (40 N. Y. 562), and fully re-affirmed the doctrine of the latter case. The case of Oberlander v. Speiss came before the court of appeals again in Nov. 1875, and any doubt which might have existed as to the meaning of the court in declaring (45 N. Y. 170) that the opinion formerly given on that case (reported 45 N. Y. 175) was to be read in connection with Marsh v. Falker (40 N. Y. 562), is removed by the express declaration of the court itself as to what it had formerly decided. Miller, J., delivering the opinion of the court, November 29,1875, says : “Upon the former appeal of this case to this court it was decided that in an action founded upon the fraud and deceit of the defendant, based upon false representations, it was not only necessary to show that the representations proven were false in fact, but that the defendant had reason to believe, and did believe at the time they were made, that they were false, and for that reason they were fraudulently made.” The learned judge, therefore, erred in refusing to charge the jury in accordance with these requests.

      Wm. R. Baldwin, attorney, and M. Compton, of counsel, for respondent, upon the proposition contained in the second general division of the head notes, urged :
    I. The defendant requested the court to charge : if the jury find that the defendant, Yeager, at the time of making the alleged representation or statement as to the credit or responsibility of F. Stern, honestly believed such statement or representation to be true, they must find for the defendant.”
    The court charged: “If you find that defendant, Yeager, at the time of making the alleged representation or statement as to the credit or responsibility of Stern had no information of facts which in the exercise, of common sense and ordinary prudence was sufficient to put him on inquiry, and would have led to a knowledge of Falk Stern’s pecuniary condition, and of his credit andpecuniary responsibility,and honestly believed such statement or representation to be true, you must find for the defendant.” 1st. Here the court charged the jury the exact language requested, modified by that clause which is in italics, being the modification referred to by the court. Having charged the exact language requested, and the clause in italics in addition, if the defendant was dissatisfied he should have objected to the court’s having charged the language of that clause, and excepted to it. If the court had. repeated the. fifth request, the same proposition would still be in the case modified by the clause in italics without objection or exception. 2d. The court having previously charged the jury that “If, at the time of making the representations in question, on the 18tli day of April, 1872, Falle Stern was good and responsible, the j ary must find for the defendant.” And again : “If you find that the defendant Yeager, at the time of making the alleged representations, on the 18th of April, 1872, honestly believed that Falk Stern was good and responsible, you mast find for the defendant.” So that the jury could not possibly have found a verdict for the plaintiffs, without disregarding these instructions until they were convinced, 1st. That on the 18th day of April, 1872, he was not good and responsible, and 2d, they were not convinced that on the 18th day of April, 1872, the defendant honestly believed Stern was good and responsible, if, in the language of the modifying clause referred to above he had been, “ informed of the facts which in the exercise of common sense and ordinary prudence was sufficient to put him on inquiry, and would have led to a knowledge of Falk Stern’s pecuniary condition and of his credit and pecuniary responsibility.” He had no right to tell these plaintiffs, under the circumstances, he was “as good as gold, and say he would not introduce him unless he knew him to be such.’’ Stern, at this time, as the jury have necessarily found, was not good; the defendant, even if he had no Ttnowledge on the subject, by declaring that he knew him to be good, “ without knowledge of its truth or falsity, was as much guilty of a fraud as if he knew it to be untrue ” (Bennett v. Judson, 21 N. Y. 238; Marsh v. Falker, 40 N. Y. 562; Wakeman v. Dally, 51 N. Y. 27). Under the decision of Wakeman v. Dally, supra, the modifying clause was proper.
    There were no printed points submitted on either side as to the propositions in the first general division »f the head notes.
   By the Court.—Monell, Ch. J.

Not having been furnished by the appellant with any of the evidence given on the trial of this action, we must assume that all the allegations in the complaint were sufficiently supported by the evidence to justify and sustain the verdict of the jury. In other words, that the cause of action, as stated in the complaint, was fully and sufficiently proven on the trial.

Nor do I think that the defendant can now claim that upon his several requests to charge the jury, there was any such conflict in the evidence, or any evidence whatever, upon which the jury could And facts to support the propositions of law propounded by him.

Thus, the first request, that if Stern was good and responsible, the jury must find for the defendant. The complaint alleged otherwise, and we must assume that the proof fully sustained the allegation. The jury therefore could not have found that Stern was good and responsible. So in regard to the defendant’s belief of Stern’s responsibility and of the conspiracy to defraud. The complaint alleged both the insolvency of Stern, and the conspiracy, and the proof is presumed to have sustained the allegations.

With these presumptions against the defendant, his requests were mere abstract propositions of law, which I do not think we are called upon to examine or decide. We at least should be able to see, that the jury might have found for the defendant upon some of the requests. How can we do so, when we must presume the evidence was wholly the other way %

We might, I think, very properly dispose of all the defendant’s exceptions to the refusals to charge upon the reasons already stated. The defendant made up the case, and could have shown that there was evidence which the jury could have applied to his propositions of law. Having omitted to do so, every legal presumption should be taken against him.

The verdict of the jury has established, that there was a conspiracy between the defendant and Stern to defraud the plaintiffs ; that to perpetrate the fraud, the defendant induced the plaintiffs to sell their property to the defendant, upon the credit of Stern, whom the defendant falsely represented to be responsible, Knowing at the time that such representations were untrue.

To such a case, thus established,with the light shed upon it by the judge’s charge, we are asked to examine the propositions of law submitted by the defendant.

The first.request to charge was that “if Stern was good, the jury must find for the defendant.” 1 do not understand that this was refused. The judge read the several requests and said he would charge them with some modifications.

In respect to the first request he said, “ you (the jury) have the evidence whether he (Stern) was good, and you are to pass upon that question.”

Taking the request, and the remark upon it by the judge, it was sufficiently indicated that if the jury should find that Stern was good, they must find for the defendant. The request contained just that proposition, and it was given to the jury, under a submission to them of the question of fact involved in it.

The second and fifth requests are like the first, except that if the defendant “honestly ~believedfi that Stern was good, &c., and this raises the principal question discussed upon the argument.

The court, after reading the requests, said to the jury, if you find that the defendant, at the time of making the representations as to the responsibility of Stern, had no information or knowled of facts, which in the exercise of common sense and ordinary prudence, was sufficient to put him on inquiry, and would have led to a knowledge of Stern’s pecuniary condition, aid honestly believed such statements to be true, you must find for the defendant.

The request of the defendant presents the naked proposition, whether an honest belief in the truth of a false statement, is not a defense to an action for damages for a fraud.

I have no doubt it is, and such is the current of decision and authority at the present day. The law on the subject is clearly and forcibly stated in the opinions of the court, in Marsh v. Falker, and Cbester v. Comstock (40 N. Y. 562 and 575), where it is said that, an intent to deceive, is the essential ingredient.

But I do not understand that the cases in 40th N. 7. undertake to interfere with the question of fact which maybe involved in any given case ; or to decide what kind of evidence shall be regarded as sufficient to show the intent to deceive. Those cases do decide, as matter of law, that representations made without intent to deceive, in the belief that they were true, ■whether it be of the existence of a fact or of the knowledge of a fact, are not per se fraudulent. That the whole question is whether the representations were fraudulently made ; and the intent to deceive must concur with the falsity.

This general proposition has been affirmed in several subsequent cases. In Oberlander v. Speiss, 45 N. Y. 175, and in Meyer v. Amidon, Id. 170. In a second appeal, in Oberlander v. Speiss (not reported), the court explains its former decision. They say that it is not only necessary to prove the falsity of the representations, but that the defendant had reason to believe, and did believe they were false. But that goes no further than the former cases, which hold an intent to deceive essential.

The proposition contained in the defendant’s request was fairly within the principle laid down in the cases referred to, and might have been very properly submitted to the jury without any qualification.

Whether the addition pub to it by the learned judge, changes or affects the legal proposition, remains to be seen.

Tne words interpolated by the learned judge were extracted from the opinion of the court in Craig v. Ward (3 Keyes, 387), where a charge to the effect, that even if the defendant did not know the representations were untrue, yet if he was informed and 'knew of the facts which in the exercise of common sense and ordinary prudence, were sufficient to put him on inquiry, and would have led him to a knowledge of the truth, he would be liable, the same as if he had actual knowledge, was upheld by the court of appeals, and has not since, that I am aware of, been reversed.

The learned judge, however, in that case, did not, nor did the court, intend todo more than to decide that case. They did not intend to lay down any general principle. The representation was by an agent in respect to the validity of a mortgage upon land, and the court say, that the proof was clear that Clark (the agent) was informed of every thing respecting the condition of the mortgage, and understood all the facts in regard to it. And then the learned judge says, (p. 303), “ Upon the case as it was presented by the proof, the charge was right;” and he adds, “I am inclined to the opinion that it is right in the abstract;” referring to Bennetts. Judson, 21 N. Y. 238.

But Bennett v. Judson, as well as Marsh v. Falker, (ubi sup.) expressly, and Craig v. Ward, by necessary implication, have been limited in their application by Oberlander v. Speiss (45 N. Y. 175) to the class of cases where the party making the representation of a fact has asserted its existence as within his personal knowledge, as contra-distinguished from belief or opinion.

In the several cases I have examined, and I have examined all in this state decided since Craig v.Ward, I can not find any modification of the principle as it is stated in Chester v. Comstock (ubi supra), namely that there must be anintent to deceive, and such intent can be ascertained only from some knowledge or information of the falsity of the statements. That they were imprudently or indiscreetly made, is not enough. In Meyer v. Amidon (ubi sup.), it is said the action can not be maintained in the absence of proof, that he believed or had reason to believe, at the time when he made them, that the representations were false, and that they were for that reason fraudulently made. And in Oberlander v. Speiss (sup.), the referee found the representations false, but did not find that the defendant knew them to be false, or any fact inconsistent with the idea that the defendant in good faith believed them at the time to be true; and it was held there could be no recovery.

Still the enunciation of the general principle does not, except very inferentially, perhaps, touch the precise point decided in Craig v. Ward (sup.), that if the defendant knew or had information of facts which were sufficient to put him on inquiry, and would have led to a knowledge of the matter represented, he would be liable. And the point is left, I think, unreversed, and in one case among the last decided by the court of appeals, is so far approved as to leave it binding upon us.

In Atkins v. Elwell (45 N. Y., 753), in reviewing one of the requests to charge, the court quote from the charge, which was literally in the language of Craig v. Ward, and say (per Folger, J.): “ The request should have embodied this element of knowledge of the falsity of the representations or informa tion of facts and circumstances which would put upon inquiry.”

Without inquiring further into the correctness of the decision in Craig v. Ward, we think it is so far affirmed by Atkins v. Elwell, that we must follow it.

The third request was -charged. There was no alteration or modification of it in its legal effect. The addition of the judge was a mere illustration of the evidence necessary to establish a conspiracy, and upon which the jury were to find its existence.

The fourth request was an attempt to limit the fraud to the first purchase. But the charge in the complaint, which, as we have seen, must be assumed to be true, was that the second purchase was in furtherance of the first conspiracy, and the reliance of the plaintiffs was upon the first representations.

Under these facts the jury could not have separated the transactions. So far as they were affected by the fraud, they were one transaction.

There was no error in refusing the request.

The portion of the charge excepted to, contains no principle of law different from that which we have already had under review, an 1 falls within the case of Craig ®. Ward.

We think there was no error committed o .1 the trial, and the judgment should be affirmed.

Sedgwick, J., concurred.


author: By the Court.-—Sedgwick, J.

text:
    SEMON BACHE, Plaintiff, v. CHARLES DOSCHER, Executor, &c., Defendant.
    L DEFICIENCY ASCERTAINED BY THE REFEREE ON A FORECLOSURE SALE AND SHOWN BY HIS REPORT ON FILE, BUT NOT. CONFIRMED.

    1. AN ACTION BASED ON THE FORECLOSURE PROCEEDINGS AND THE REFEREE’S REPORT TO RECOVER THE AMOUNT OF THE DEFICIENCY AS REPORTED, CAN NOT BE SUSTAINED.

      (a) Confirmation of the report is a pre-requisite to such an action.
    1. This, where the form of a foreclosure judgment, after directing the referee to make certain payments, .is in the present usual form, to wit: “-that if the proceeds of such sale be insufficient to pay the amount so reported due to the plaintiff, with interest and costs, as aforesaid, the said referee specify the amount of such deficiency in his report of sale, and the defendant, A. B.” . (he not being the defendant against whom the action to recover the deficiency is brought), “pay the same to the plaintiff, and that the plaintiff have execution therefor,” without, in express terms, requiring confirmation of the report of sale.

      1. CONMEMATIOIt, HOW TO BE OBTAINED.
    (it) By giving notice of the filing of the report and allowing eight days thereafter to elapse, if no exceptions are filed, the report becomes confirmed; if exceptions are filed, they must be brought to a hearing (Rule 39).
    (5) Semble. Perhaps it should be held to be the practice to enter an ex-parte order nisi, confirming the report, unless, cause to the contrary be shown, within eight days after notice of its entry, and of the filing of the report.
    2. Fuhthek steps.
    Whether, after confirmation, any further steps, and if so what, should be taken, is not passed on ; confirmation is at least necessary.

      Before Monell, Ch. J., and Sedgwick, J.

      Decided, April 3, 1876.
    H. FOSEOLO SURE.

    1. REFEREE TO SELL, &c., POWER OF.

      (a) Allowance to purchaser out op the purchase money. 1. Prior mortgages,—Tie has no power to allow to the purchaser the amount thereof, and receive from him only the balance of the purchase money,
    UNLESS
    the judgment so orders.

      (b) Report op sale, when, although IN' WORDS reporting a deficiency, IT IN FACT reports no deficiency.
    1. When it appears on the face of the report, that the deficiency stated, was arrived at by making an unauthorized allowance to the purchaser of a sum equal to, or greater than, the deficiency reported.
    Exceptions heard in first instance at general term. Complaint dismissed.
    The complaint averred that plaintiff was assignee of a bond made by one Goebel, secured by mortgage upon real estate, that Goebel conveyed the real estate to Hardin, the defendant’s testator, and Hardin covenanted to pay the sum of money secured by said bond and mortgage ; that after his death, plaintiff proceeded "to foreclose the mortgage ; that defendant, as executor oí will, &c., of Hardin, was made a party to the action ; that judgment was given of foreclosure, “ and that if the proceeds of the sale should be insufficient to pay the amount reported due to the plaintiff, with interest and costs, the amount of such deficiency should be specified in the report of sale therein,” &c.; “ that upon such sale there occurred a deficiency of $731.55, as appears by the report of sale of said referee duly filed that ro part of the deficiency has been paid, though the plaintiff had demanded payment, &c.

      The answer was in substance, a general denial.
    The plaintiff gave in evidence, the mortgage by Goebel, and the deed of the fee by the latter to Hardin, defendant’s intestate, in which he assumed the payment of the mortgage. The plaintiff further gave in evidence the judgment roll in the action of foreclosure, to which the present defendant was a party. The complaint in that action set out enough facts to show that these defendants were liable to pay the amount of the mortgage, upon the covenant, in the deed to their testator, but it did not demand judgment against the defendant for the deficiency: while it did against Goebel, the obligor in the bond.
    The judgment in foreclosure provided, that the referee appointed for that purpose, pay out of the proceeds of sale specified costs, fees and expenses, “any lien or liens, upon said premises, so sold at the time of such sale, for taxes or assessments,” and then to the plaintiff two thousand five hundred and eight dollars and ninety-eight cents, the amount adjudged to be due to him, and ‘ ‘ that if the proceeds of such sale be insufficient to pay the amount so reported due to the plaintiff, with interest and costs as aforesaid, the said referee specify tne amount of such deficiency in his report of sale, and the defendant, William Goebel, pay the same to the plaintiff,” and that the plaintiff have execution therefor.
    The report of the referee was given in evidence, it having been filed ; and it stated, that the plaintiff had become purchaser for nine thousand seven hundred dollars; that the referee had allowed, in closing the purchase, six thousand and ninety-one dollars and twenty-five cents for prior mortgages assumed by him ; “ that other allowances had been made; that he had paid over to plaintiff, through his attorneys, one thousand eight nundred and two dollars and eighty-two cents,” leaving a deficiency still due and unpaid of seven hundred and forty-one dollars and fifty-five cents.
    No proof was given of the existence at the time of making the report, of the mortgage, the amount of which was allowed. There was no proof that notice of the filing of the report had been given to the parties defendant in the foreclosure action. There was no order confirming the report.
    The court dismissed the complaint, on the ground, ' that the plaintiff had no cause of action, and ordered the exception to be heard, in the first instance at the General Term.

      Kauffman, Tunstall and Wagner, attorneys, and Lewis Sanders, of counsel for plaintiff, argued against the dismissal of the complaint.
    Their printed points, however, do not bear on the questions decided by the court.

      Stillwell and Swain, attorneys, and of counsel for defendants, on the questions decided, urged:
    I. The report of a referee is not, per se, a record of judicial determination, and does not prove itself, and is not evidence of any fact, against any person. A report of sale is an ex parte proceeding, and has no effect until it is confirmed by the court; and where a party has appeared in the action, this can only be done, and the report be made evidence against him, by showing notice to him (Rules 39 and 73 Supreme Court, Griffing v. Slote, 5 How. Pr. 205).
    II. The report of a referee is not, in any case, evidence of anything, except as to matters which have been referred to him. The duties of a referee appointed in a foreclosure suit to sell the property, are ministerial in their nature. He is not authorized to adjudicate upon, or allow, or pay any other liens or claims, except those specified in the judgment, but is directed to pay these, and deposit the balance of the proceeds of the sale with the Chamberlain, subject to the order of the court (People v. Bergen, 53 N. Y. 404). His report is, therefore, no evidence that there was any other encumbrance by mortgage on the property, or that it was a prior encumbrance, or that it was paid ; and as no voucher is annexed for the six thousand dollars alleged to have been allowed, the declaration of the referee, in the report, is no evidence of the disposition that was made of that amount (See Rule 73, Supreme Court).

    III. There having been, therefore, no evidence of the facts alleged to have been shown by the report of sale, that there were any prior encumbrances on the property, that the proceeds of the sale had been so applied as to leave any deficiency for which the defendant was liable to the plaintiff, or that the plaintiff had been authorized to commence the action, the learned judge properly granted the defendants’ motion for non-suit.
   By the Court.-—Sedgwick, J.

On the argument, the respondent’s counsel argued that the complaint was properly dismissed, because it did not appear, that leave had been obtained to bring this action, and by section 153 of the Revised Statutes, vol. 2, p. 191, after a bill is filed for the foreclosure of a mortgage, “ no proceedings whatever shall be had at law, for the recovery of the debt secured by the mortgage or any part thereof, unless authorized by the court,” &c. It seems to me, best not to examine this question, because it is not specifically referred to in the pleadings, and was not upon the trial. If the obtaining of leave was part of the plaintiff’s cause of action, in a sense that called upon him to plead it and prove it,' then the action of the court below might properly be sustained on that ground; but as the objection is of a nature that a party would be able, upon due notice, to' ask leave to amend, &c., it is best not to rest a determination of the merits upon it.

The plaintiff did not base his action, even if he had a right so to do, upon the liability at law of the defendant’s testator, upon his assumption of the mortgage. The obligor of the bond might, under proper circumstances, have called upon the plaintiff, to apply the value of the security, viz. : the land, to the payment of the bond, as far as it would go, before calling upon him to pay. The plaintiff, voluntarily did this in the action of foreclosure, and the defendants were properly parties, if for no other purpose, in order to bind them by an adjudication, which should, against them, fix what amount would remain due upon the bond and upon the assumption of the mortgage, after the proceeds of the land had been applied towards satisfaction. We advert to no other questions than those which the parties have made in this action. The plaintiff, therefore, proceeded, on the trial of this action, to show that there had been an adjudication in the foreclosure action; that the proceeds of the sale, after making the proper deductions, did not satisfy the debt, but left a deficiency. The* plaintiff was not entitled to recover in this action, if the record did not show that there was a deficiency.

It is plain, that the interlocutory judgment, did not adjudicate that there was a deficiency. It only provided, that the plaintiff should have execution for the amount of a deficiency, if there should be one. For the purpose of ascertaining this, it directed specifically what the referee, who was but a ministerial officer (People ex rel., Day v. Bergen, 53 N. Y. 404), should do with the proceeds of the sale; he was to deduct expenses, costs, taxes and assessments; then be was to pay the plaintiff, the amount found to be due to him, and report what surplus there was or what deficiency. In regard to these things, the action of the referee being ministerial and not. judicial, it or his report thereon, could not have the binding force of an adjudication. It would have been passed upon judicially, if it had, according to the rules and practice, been confirmed by the court. Filing it, did not give it judicial sanction. The burden of proof is upon the plaintiff. By rule 39, the report does not become “absolute and stand as in all things confirmed” until notice of filing 1ms been given, and eight days have elapsed after the notice, without exceptions being filed. Evidently, the party against whose interest the report is, is not brought before the court and called upon to make exceptions, or be bound bjr an omission to make them, until he has received notice of filing. Therefore, at least, without deciding in this case what should be the further steps to be taken, if any, the party sustaining the report as an adjudication, should show that notice of filing had been given to the par.ty who has the right to except.

A reference to the practice before the present rules, will perhaps make this clear.

The chancellor held, that it was not necessary to wait until after the sale of the mortgaged premises before the contingent decree for the payment of such deficiency could be" made (McCarthy v. Graham, 8 Paige Ch. 480; De Agreda v. Mantel, 1 Abb. Pr. 135).

The form of the decree to be entered in such cases expressed with greater accuracy, than is used in the present judgment, the rights of the parties. It adjudged payment of the. deficiency, and authorized an execution to be issued for it, “if there should appear to be one, upon the coming in and confirmation of thé master’s report” (Sprague v. Jones, 9 Paige Ch. 397).

In the Bank of Rochester v. Emerson (10 Paige Ch. 115), the complainant,had foreclosed a mortgage made by the defendant, and had the usual decree over against him for deficiency in case the proceeds of the lands should be insufficient. The bill in the case cited, was a creditor’s bill to obtain satisfaction of the deficiency, and after setting out the proceedings, and decree in foreclosure, further stated that the master reported, that there was a deficiency, &c., “as by the report duly confirmed, &c., would more fully appear,” and that execution had been issued and returned unsatisfied. The defendant pleaded in bar, that the report of the master as to the deficiency, had neither been filed nor confirmed, at the time the execution was issued. The question was whether this was a bar. The chancellor held that it was. He said it was not a case of a mere irregularity in the execution, which could not be examined in a collateral suit. He said, what is particularly in point here, that “the decree does not direct the mortgagor to pay the deficiency, when it shall be ascertained by the result of the sale, or when the master shall have made out, and signed his report. .Nor does the filing of the report of the master, stating the amount of the deficiency, entitle the complainant to demand the immediate payment of such deficiency, so as to authorize the issuing of an execution therefor. The decree is that the mortgagor or other defendant, who is personally liable for the mortgage debt, pay the amount of the deficiency reported due, upon the coming in and confirmation of the report of the master. Until the master’s report is confirmed as well as filed, therefore, the deficiency is not payable, under the decree,” &c.

In the present case, the judgment does not, in terms, call for the confirmation of the report, but by construction of the law, such is its meaning. The rule 39, applies itself to the judgment, and shows, that the judgment did not finally adjudge the payment of a deficiency reported by a report which was not final.

By the former practice, and perhaps it should be held to be the practice now, this matter was made definite, by an ex parte order nisi, confirming the report, to become absolute eight days after notice of its entry and of the filing of the report. The present rule, however, provides only, by its words, for notice of filing, &c.

Finally, the report in the present case, is official only in those respects in which the referee obeyed the judgment. It was extra-official, and only personal, in those respects in which he acted without the direction of the judgment. By the words, he was directed to specify the amount of deficiency only, if the proceeds of the sale were insufficient, after he had made the particular deduction directed. He was not directed to allow the purchaser the amount of prior mortgages upon the land, nor even to ascertain if there were such. So far as the record shows, the purchaser’s right as to these alleged mortgages, was if the facts justified him, to refuse to complete the purchases. Therefore when the referee made a deduction greater than the amount reported as deficiency, which he was not authorized to make, it. in substance appears by the report itself, that the proceeds of the sale were not insufficient to pay the amount due to plaintiff, and there was no deficiency.

I am of opinion that the plaintiff’s exception should be overruled, and the defendant have judgment, upon the order dismissing the complaint, with costs.

Monell, Ch. J., concurred.