author: Tan Brunt, P. J. :

text:
    Henry E. Alexander, Appellant, v. Joseph A. Donohoe and Eugene Kelly, Respondents, Impleaded with The Mariposa Company and Others.

      Action by a stockholder barred by adjudgment against Ms company.

    In an action against the Mariposa Company, the Mariposa Land and Mining Company of California, the Mariposa Land and Mining Company of New York, and certain individuals, stated in the complaint to be brought by the plaintiff on behalf of himself and all others' who, as stockholders of the California company, were assignees of the original holders of trust certificates of the Mariposa Company, and in which relief was sought for frauds alleged to have been practised Upon the plaintiff and others similarly situated, by the individual defendants, which resulted in such defendants obtaining large sums of money out of an estate in California known as “ Las Mariposas,” and finally obtaining title to the estate itself, it appeared from the complaint that a judgment of foreclosure had been recovered in California against the California company, which established the validity of, and directed a sale under, a mortgage upon such estate.
    To avoid the effect of the California judgment as a bar to the maintenance of the present action by the plaintiff as a stockholder in the California company against the individual defendants,’ the plaintiff claimed that the complaint showed that, having been the owner of certain trust certificates of the Mariposa Company, he had exchanged them for stock of the California and afterwards that stock for stock of the New York company, in ignorance of the frauds alleged in the complaint to have been perpetrated upon him, and that he was by reason of such fraud entitled to a return of such certificates and to "maintain the action as a holder of such trust certificates.
    The complaint did not allege any attempt on the part of the plaintiff to rescind his exchange of Mariposa Company trust certificates for California company stock, or contain any offer to return such stock; nor did it allege that the California judgment was collusive or fraudulent, but alleged that certain facts were not presented to the court in California which might have been established.
    On the hearing of an appeal from a dismissal of the complaint as to the individual defendants, directed on the pleadings,

      Held, that the plaintiff’s right to claim to be a holder of Mariposa Company certificates, and to be entitled to maintain the action as such holder, was not made out by the complaint.
    That from the allegations of the complaint, it was apparent that the plaintiff’s only evidence of interest in the property in suit, was as a stockholder of the California company, and it being necessary that he should assert through that company whatever rights he had against the property, and the identical questions to be litigated in the present action having been litigated by that company in good faith in another action, and that company having been defeated, the plaintiff was bound by that judgment.
    That, consequently, the California judgment was a bar to the plaintiff’s seeking, as a stockholder of the California company, to obtain any relief as against the alleged fraudulent acts of the individual defendants.
    Appeal by the plaintiff, Henry E. Alexander, from a judgment of the Supreme Court, entered in the office of the clerk of the city and county of New York on the 30th day of June, 1890, upon a decision of the court after a trial at the New York Special Term, dismissing the complaint upon the merits.
    The action was brought against Joseph A. Donohoe, Eugene Kelly, the Mariposa Land and Mining Company of California, the Mariposa Land and Mining Company of New York, the Mariposa Company, and others, to obtain relief for frauds alleged to have been practised upon the plaintiff, and the others on whose behalf he sued, by the defendants, Donohoe and Kelly, and other individual defendants, which, the complaint alleged, resulted in the obtaining of various large sums of money by Donohoe and Kelly, out of an estate in California known as “ Las Mariposas,” the beneficial interest in which belonged to the plaintiff, and others similarly situated, and, finally, in their obtaining an absolute title to the whole of the estate.

      E. O. Perkins, for the appellant.

      F. P. Ooudert, for the respondents.
   Tan Brunt, P. J. :

It will be impossible within the reasonable limits of an opinion, to rehearse all the evidence, conclusions of fact and conclusions of law, set out in the 154 pages of the complaint herein.

A dismissal of such complaint having been had before the taking ■of testimony, the only question presented is, whether upon all the allegations contained in the complaint, the plaintiff shows any right of recovery.

Upon the trial the plaintiff, having desired to amend his complaint, as a condition of such amendment, was obliged to, and did include therein, a judgment-roll in an action of the courts of California; .and it appears to have been held by the court below that this judgment was a bar to the plaintiff’s recovery. It will be necessary, therefore, only to advert to so much of this voluminous complaint •as will serve to illustrate the position of the plaintiff in respect to the ■defendants in the action in California, in order that it may be determined whether or not the ruling in the court below should be upheld.

The plaintiff herein brings this action, as he states in his complaint, on behalf of himself and all others who, as stockholders of the defendant herein, the Mariposa Land and Mining Company of ■California, are assignees of, and successors to, the original holders •of the Mariposa trust certificates and trust preferred stock and ■other stocks of the defendant, the Mariposa Company, under a trust deed dated April 25, 1868, and holders of the stock of the ■defendant, the Mariposa Land and Mining Company of New York, and of and to all right, title and interest of the said original holders in and to the Mariposa estate in said complaint described, and who have accepted stock of the defendants, the Mariposa Land and Mining Company of New York, and the Mariposa Land and Mining Company of California, under the circumstances thereinafter described, who are similarly situated with the said plaintiff, and who ■should come in and take part in and contribute to the expenses of this action.

Upon the argument of the appeal it was admitted by the counsel for the appellant that the issues litigated in the California action were substantially the same as those presented herein. But it is ■claimed that the plaintiff, having been the owner of certain Mariposa trust certificates, which he had exchanged for certain stocks of other corporations in ignorance of the frauds alleged in the complaint, perpetrated upon him, is, hy reason of such fraud, entitled to a return of these certificates, and is in equity entitled to maintain this action as such certificate holder; and that the plaintiff, and those similarly situated, are to he regarded not as stockholders of the new companies which will he hereinafter mentioned, but simply as holders of the original Mariposa trust certificates.

It seems somewhat doubtful whether this action was commenced upon any such theory, in view of the allegations contained in the complaint that “ this plaintiff has not applied to the said defendant corporations (viz.: the Mariposa Land and Mining Company of New Tork and the Mariposa Land and Mining Company of California), nor to the said trustees (being the trustees of such corporations), to induce them to bring actions to set aside the aforesaid fraudulent contracts and conveyances, nor to remove the cloud on the title to the Mariposa estate, caused thereby, etc., for the reason that the trustees, directors and officers of said corporations, and a majority of the said trustees, have either been parties to the said fraudulent acts and doings sought to be avoided and set aside, or have been fraudulently or improvidently consenting thereto; and it would be a useless form to request them to take action for the protection and enforcement of the rights of this plaintiff and of those similarly situated; and this plaintiff, and those similarly situated with him, are afraid and unwilling to intrust the conduct of this suit, or of any similar suit, to' them, or to any of them, whose acts are sought to be impeached as aforesaid, and should not in equity be compelled so to do.”

This allegation is only consistent with the theory that at the time at least of the filing of this bill, the plaintiff was seeking to enforce, as a stockholder of these two companies, rights of these corporations against those who had been fraudulently conspiring against such rights.

But it would appear that it is now sought to maintain this action upon a different ground.

It must be conceded that if the plaintiff, as a stockholder of the Mariposa Land and Mining Company of California, is seeking to obtain any relief as against the alleged fraudulent acts of some of these defendants, the judgment in California is a bar to the action now before this court. That action in California was brought hy one of the defendants in this action for the foreclosure of a mortgage, the validity of which is assailed in this action; the Mariposa Land and Mining Company of California, and as a subsequent incumbrancer, were made parties to that action, and by answer and cross bill, substantially the same allegations were made against the validity of that instrument as are contained in the complaint in this action. The result of the trial of the issues in California was a defeat of the claim of the invalidity of the mortgage, and the establishment of the rights which are assailed in this action. There is no pretense or allegation contained in this complaint that such judgment was collusive or fraudulent; but it is alleged that certain facts were not presented to the court in California which might have been established, and that certain parties were not made defendants in that action, and that certain rights were not cut off therein, all of which depend upon the question, which has heretofore been suggested, as to whether the plaintiff can maintain this action as the equitable holder of the original Mariposa trust certificates.

It will be necessary in order to determine this proposition to examine briefly the general allegations of the complaint. It is alleged that the defendant, the Mariposa Company, was a corporation duly organized in the year 1868, under the laws of the State of New York for the purpose of holding and operating mining property-in the State of California referred to as the Mariposa estate ; that the defendants, Eugene Kelly and Joseph A. Donohoe, were copartners in business in the city of New York under the firm name and style of Kelly & Co., having also a place of business in the city of San Francisco, Cal., under the firm name of Donohoe, Kelly & Co., Kelly residing in New York and Donohoe residing in San Francisco; that prior to the 25th of April, 1868, the defendant, the Mariposa Company, was the equitable owner and in possession of a certain tract of land in the county of Mariposa and State of California known as Las Mariposas estate, containing seventy square miles of land, upon which there were extensive and valuable mines of gold and other minerals. Coupon bonds of the said Mariposa Company payable to bearer and bearing interest at seven per cent per annum, upon which it was in default, were then outstanding secured by the company’s mortgage upon the estate, and the company had the usual accompaniment of a floating debt and preferred and common stock. The defendant, John W. Brummagin, held the legal title to the estate, which legal title had been acquired for account of his brother, the defendant, Mark Brummagin, at a cost to said Mark Brummagin of the sum of $300,000, or thereabouts ; and was then owned by said Mark Brummagin though in the name of John; that on the said 25th of April, 1868, the said John "W. Brummagin conveyed the said Mariposa estate to certain trustees upon certain trusts mentioned in said deed, and among other provisions in said deed it was provided that said trustees should issue and deliver certificates referred to in said deed as Mariposa certificates to an amount not exceeding in the whole $4,000,000 of principal, to such of the holders of the preferred stock of the Mariposa Company and to such of the creditors of said company upon bonds, judgments or otherwise as the said trustees might elect, upon transfer, assignment and delivery to said trustees by said preferred stockholders and creditors to whom such certificates should be issued of an amount of either preferred stock, or of indebtedness of said Mariposa Company, equivalent to the par value or principal of such Mariposa certificates, and upon the payment in cash to said trustees by the parties receiving such certificates of such amount as said trustees of the Mariposa estate should see fit from time to time, or in respect to each transaction, to prescribe and exact; provided that such amount of cash should not be less than ten per cent upon the par value of such of said certificates as should be issued in exchange for bonds or other indebtedness of the company other than judgments, and thirty per cent in cash upon the par value of such certificates as should be issued in exchange for judgments against said company or of preferred stock of said company; which agreement also contained certain provisions. in regard to the disposition of the cash thus received.

The complaint then alleges that the holders of the bonds of the Mariposa Company and the other creditors and stockholders availed themselves to a very large extent of the privileges of said trust deed, and exchanged then’ bonds and debts and stocks for the Mariposa trust certificates; and that in this month certificates were issued and became outstanding to the amount of $4,000,000, or thereabouts, and there was paid as assessments or percentages on said exchange of securities the sum of $700,000, or thereabouts.

The complaint then contains allegations as to the liquidation of portions of the indebtedness above referred to; and. as to a scheme upon the part of Kelly <fc Donohoe and John W. Brummagin to qbtain the title to the property by fraudulent concealment of proceedings in reference to the collection of taxes from the majority of the trustees in the trust deed and from the certificate holders and others interested in the Mariposa Company, which resulted in the sale of the property for taxes, and a purchase of the same in the interest of Kelly & Donohoe ; and also allegations as to the proposed sale by the trustees under the trust deed and to an attempt to redeem the property from the tax sales.

The complaint also alleged that the plaintiff became the holder in March, 1870, of 100 shares of the first preferred stock of the original Mariposa Company, and that in April, 1870, he purchased in the open market $10,000 of Mariposa trust certificates.

It is further alleged that on the 8th of June, 1871, the Mariposa Land and Mining Company of New York was duly incorporated for the like purpose and object as the original Mariposa Company, the certificate of incorporation fixing the amount 'of the capital stock at $15,000,000, $5,000,000 of preferred and $10,000,000 of common stock and that it was proposed that this stock should be issued in exchange for the trust certificates and for the securities of the original company, ujDon certain terms and conditions, in reliance upon which the holders of trust certificates, including the plaintiff, exchanged their former holdings of certificates and stock for the new stock, paying large sums of money for the supposed privilege; that the exchange to the plaintiff was made on the 17th of November, 1871, he paying $500 in cash and receiving a certificate for 2471-shares of the said company’s preferred stock ; and that in March, 1873, the holding of stock of the plaintiff in the Mariposa Land and Mining Company of New York amounted to 250 shares; and that in the way above stated, on or before the 30th of January, 1872, the new company became possessed of a large number of Mariposa trust certificates and Mariposa first preferred stock.

The complaint then contains various allegations of fraudulent conduct on the part of Kelly & Donohoe, by whom claims were preferred against said properties without any foundation in fact, and that under the laws of California for the organization of corporations for the purpose of owning and operating mines within said State assessments might be made by corporations upon the holders-of its stock for moneys to be used in conducting the mining operations and paying the indebtedness of the corporation, which power did not exist in the State of New York; and that in order to avail himself of this further mode of raising money, the defendant, Mark Brummagin, in or about the month of November, 1874, caused the incorporation of the defendant, the Mariposa Land and Mining Company of California, with power to levy assessments on its shareholders as above described, and that on the 16th of November, 1874, the Mariposa Land and Mining Company of New York, executed and delivered to the Mariposa Land and Mining Company of California, a deed or deeds purporting to be of the Mariposa, estate in exchange for the entire capital stock of the California company, to be distributed and delivered share for share to and for the holders of the capital stock of the New York company in exchange therefor, and in further consideration of the assumption by the California company of the debts of the New York company, and of all claims against the trustees of the aforesaid trust deed of April 25, 1868; that in said month certificates for the entire capital stock of the California company were delivered to the New York company, and in the year 1875, the plaintiff surrendered his said 250 shares' of stock of said New York company to the. California company and received in place thereof 250 shares of the capital stock of said California company, upon which stock the plaintiff has paid into said California company divers-assessments.

The complaint then alleges that in the close of the year 1875, said Kelly and Donohoe were without other hold upon the Mariposa estate for the collection out of it of the balance of their alleged claims, than the possession by way of pledge, of some 50,000 shares by the Ne.w York company, whose officers claimed to have conveyed the entire estate; that thereupon two plans were formed for the better insuring the collection of said alleged balance out of said estate, one devised and favored by Kelly, and one devised and favored by Donohoe. Various negotiations were had by said Kelly and Donohoe, and in January, 1875, said Donohoe caused the Mariposa estate to be bid in under the name of his agent, at a sheriff’s sale, under execution to enforce judgments theretofore, and in December, 18 Yl, obtained against the New York company, the said purchase being made for the joint benefit of Kelly and Donohoe, and the purchase price being furnished and paid by said firm of Eugene Kelly & Co. of New York; that Donohoe purchased certain judgments against the New York company, and also caused the estate to be bought in on a sale for taxes of the previous year; that in June, 18Y5, said .Kelly, having abandoned his own plan in favor of the scheme devised by Donohoe, thereafter united with said Donohoe in attempting to perfect the title of the Mariposa estate, on such terms and conditions as would best insure the collection out of said estate of the balances claimed by Kelly & Donohoe against said Brummagins, and in pursuance of said scheme, in said June, and before the expiration of the time allowed by law for redemption from said judgment sales and sales for taxes, said Kelly, as president and secretary of the New York company, and one Stilwell, claiming to act as stockholder of the New York company, and on behalf of certain other stockholders, executed a certain agreement, and said Donohoe in July, 18Y5, and before the expiration of the time allowed by law for the redemption from such judgment sales and sales for taxes, executed an agreement in California, by and with the president and secretary of the California company, in the name of said company. By the first of these agreements it was provided that Kelly should surrender to the California company certain certificates of common and preferred stock of the New York company, and certain canceled Mariposa trust certificates, and a note of John W. Brummagin for $103,515.39 gold, held by him, upon certain payments being made. By the second agreement, after reciting the purchase by Donohoe at sheriff’s sale, and the ownership of certain judgments purchased by Donohoe, and that the California company was without means to redeem the property from said sale, or to pay the judgments against the New York company, and that it was important to the California company to secure prompt settlement of certain litigations pending, and that it was desirous of having the said .premises conveyed to it immediately after the sheriff’s deed shoujd be executed and delivered, and to give to Donohoe a mortgage for the purchase money, it was agreed by the California company to purchase from Donohoe the right, title and interest in and to the said property, and to pay him therefor the price therein named, and simultaneously with such conveyance, for the purpose of securing payment to said Donohoe of such purchase price, the California company agreed to ■execute and deliver to him certain promissory notes, seven in number, the first note payable in six months and the last notes in twenty-four months, each of which notes should be conditioned that if ■default should be made in payment of the principal and interest of ■any of the notes or any part thereof, and such default should continue for the period of thirty days, then the whole principal sum .and interest should be due, and all the notes should be deemed to be and should immediately thereupon become due and payable; and to secure the payment of said notes, the California company agreed to execute and deliver to Donohoe a mortgage upon its property ; .and that in pursuance of this agreement, on the 2d of August, 1875, the notes and mortgage were executed by the California company and delivered to the defendant Donohoe.

The complaint then alleges that certain of the notes were given to pay for money furnished by the firm of Kelly & Co. at said judgment and tax sales, together with interest thereon; that certain other of the notes were given to cover and provide for the note of Brammagin, with interest, and other of the notes to pay for an amount claimed by Kelly to be due from Mark Brummagin, and for counsel fees of Kelly’s counsel in New York, and that said notes were without consideration, and that the New York company had never ratified the arrangement with Donohoe, nor was there any valid authorization or ratification by the California company; and that after the execution and delivery of said promissory notes and mortgage by the said California company to said Donohoe, such company was put into possession of the Mariposa estate under deeds theretofore executed by the New York company, and also under deeds executed by Donohoe, and thereupon the said company at sundry times levied sundry assessments on said stock, and thereby received and collected considerable sums for the operating of said estate, out of which sums said company paid said Donohoe for himself and said Kelly, before the commencement of this action, or of the foreclosure suit thereinafter mentioned, the sum of $160,000, or thereabouts; and that by said payments, the whole amount due to or incurred by said Kelly & Donohoe, or either of them, in the purchase of said estate under judgment and tax sales in 1874 and 1875, and in the purchase of said judgment against the Mariposa Land and Mining Company of New York were more than paid, and all equitable claims or lien which might have arisen in favor of Kelly & Donohoe against the estate, by reason of said purchases by them, were thereby wholly satisfied and páid.

The complaint further alleges that, nevertheless, said Donohoe brought a suit in the District Court of California in and for the city and county of San Francisco, in August, 1877, against the Mariposa Land and Mining Company of California and the Farmers’ Loan and Trust Company, for the purpose of foreclosing said mortgage, by reason of the failure of said California company to pay certain of the notes given as aforesaid.

It further appears, from an inspection of the judgment-roll annexed to said complaint, that the California company answered said complaint, setting up substantially the facts contained in the complaint in this action, and claiming a cancellation of the notes and mortgage' in question, and that the Farmers’ Loan and Trust Company, an incumbrancer subsequent to the mortgage to be foreclosed, answered and also filed a cross-bill setting up the same facts and claiming the same relief; that the plaintiff answered said cross-bill, and these issues were tried and such proceedings were had that a decree of foreclosure and sale was pronounced and entered by said court, and a sale of the Mariposa estate was had under the decree in January, 1882, and said estate bought in by said Donohoe for the sum of §300,000, being the amount of said judgment; that an appeal has been taken from said decree, but the time within which the redemption of said estate from the said sale under the statutes of California, in case the said decree and sale are allowed to stand unimpeached, has long since expired.

The complaint further alleges that the trustees of the Mariposa, estate, Mark Brummagin and the Mariposa Land and Mining Company of New York, were not made parties to that suit, and that no party in interest in said Mariposa estate, whether as holders of trust, certificates or of stock of the original Mariposa Company, or of the stock of the Mariposa Land and Mining Company of New York, or of the stock of the Mariposa Land and Mining Company of California, including this plaintiff, were made parties to this suit; and that, in view of the facts set forth in the complaint, the rights of the cestuis que trustemt under the trust deed, including the plaintiff and their assigns, and the holders of the stock of the Mariposa Land and Mining Company of New York and the Mariposa Land and Mining Company of California had not been foreclosed or cut off by any decree in said suit, they not having been parties thereto nor represented therein, and there being also certain defenses to any action based upon the validity of said mortgage which were available to them, but which could not be set up by said California company; and that the rights of the plaintiff and others interested in the Mariposa estate were not represented by the said California company, as defendants in said suit; and that the said District Court of the fourth judicial district of California was wholly without jurisdiction of the parties above named not made defendants.

Then follow certain general allegations which are not material to the questions to be discussed upon this appeal. And judgment is prayed amongst other things that the decree made in said suit in the District Court, and the sale thereunder, be declared as of no binding force against the trustees under the trust deed, or against the New York company or its stockholders, or against the California company, or against the plaintiff and those similarly situated.

Upon this review of the allegations of the complaint, it is difficult to see upon what theory the plaintiff can claim that he is a holder of Mariposa trust certificates, and assert rights under the trust deed of 1868. He has not only surrendered such certificates in exchange for stock of the Mariposa Land and Mining Company ok New York, but has exchanged that stock for stock of the Mariposa Land and Mining Company of California. And there is no pretense that there has been any attempt upon his part to rescind such exchange, or any offer upon his part to return the stock of which he is the holder and by virtue of which he substantially claims to be the holder of the trust certificates.

In the consideration of this proposition it is not necessary to determine whether, under the circumstances shown by the allegations in this complaint, he could even by an offer to tender back the stock which he had received, at this late day put himself in a position to enforce .his rights as equitable owner of Mariposa trust certificates. But it is clear that being a stockholder of the Mariposa Land and Mining Company of California, and that being his only evidence of interest in this property, and it being necessary that he should assert through that company whatever rights he has as against this property, and the identical questions to be litigated in this action having been litigated by said company in good faith, and said company having been defeated, this plaintiff is bound by that judgment.

As a stockholder he has no independent right of action. 'What■ever rights he has he must assert through the company of which he is a stockholder. The only theory upon which a stockholder is permitted to bring suit, as recognized by the allegations of the complaint in this action, is that it is brought on behalf of the company ’to establish rights existing in the company by the stockholder, because for the reason the trustees of the company have refused to or will not protect the rights of the company in respect to the subject-matter. Such being the case, the Mariposa Land and Mining ■Company of California represents all the parties who it is claimed were not made parties defendant.in the foreclosure suit, and a judgment against the company is binding upon them.

There are no holders of Mariposa trust certificates. It would •appear from the allegations of the complaint that all these certifi•cates had been surrendered and canceled in the various negotiations which resulted in the placing of the title of this property in the •California company and the execution and delivery of the notes and the mortgage to Donohoe which was foreclosed by him.

It would seem, therefore, that there was no ground whatever upon which the plaintiff could come into court and obtain relief, ■this court having no power of review over the proceedings in the District Court of California.

If it had been shown upon the part of the plaintiff that the ■California judgment had been conclusively and fraudulently obtained, then perhaps some relief might possibly have been afforded 'in the courts of this State. But it is doubtful if even that could be ■done, the subject-matter of the litigation and the parties to it being residents of and situated within the State of California. But this point it is not necessary to determine in the disposition of this iappeal.

It would seem, therefore, that the judgment should be affirmed, with costs.

O’Brien and Eollett, JJ., concurred.

Judgment affirmed, with costs.


source: Caselaw Access Project

author: Nan Brunt, P. J.:

license: Public Domain

text:
    William G. Bates, and Others, Respondents, v. United Life Insurance Association, Appellant.

      Chambers and Special Term — motions, in New York city — motion for judgment on the pleadings — life insurance policy — unavailing defense to an action on.

    An irregularity in noticing for hearing at the Special Term at Chambers of the Supreme Court in New York city (where the justice sitting at Chambers also holds, in the same room, the Special Term for non enumerated motions) a motion for judgment on the pleadings, which should be noticed for and heard at the Special Term for non enumerated motions, does not vitiate a judgment entered on an order granted on such motion, when the motion was, as matter of fact, heard in the proper court.
    In an action brought to recover on a life insurance policy which was, by its terms, made indisputable after payment of premiums for a certain period which had elapsed,

      Held, that a defense, based upon statements in the application on which the policy was issued, was unavailing, and that judgment for the plaintiff on the pleadings was properly rendered on motion.
    Appeal by tbe defendant, tbe United Life Insurance Association, from an order of the Supreme Court, made at tbe New York Special Term and entered in tbe office of tbe clerk of tbe city and county of New York on the 16th day of November, 1892, directing judgment for tbe plaintiffs on the pleadings, and from tbe judgment entered pursuant to such order on tbe 22d day of November, 1892. Tbe notice of motion for judgment was as follows:
    “You will please take notice that on the pleadings in this action I shall move this court at a Special Term thereof, to be held at its Chambers in the county court bouse in tbe city and county of New York, on tbe 7th day of November, 1892, at eleven o’clock in tbe forenoon of that day, or as soon thereafter as counsel can be beard, for judgment as demanded in tbe complaint, or for such other and further or different relief or order in the premises as may then to the court seem proper, with costs and the costs of this motion.”
    The order made on such motion was headed : “At a Special Term of the New York Supreme Court( held at the county court house in the city and county of New York on the 16th day of November,, A. D., 1892.”
    The notice of appeal described the order appealed from as “ the-order made and entered in this cause on November 16, 1892, on, the decision at Special Term, held in Chambers, Honorable George: P. Andrews, justice, directing judgment upon the pleadings in favor ■ of the plaintiffs and against the defendant on the non enumerated; motion for such order made by said plaintiffs.”
    The action was brought to recover upon two certificates of membership or policies of life insurance, issued by the defendant to Levi 3VI. Bates, deceased, and of Avhich the plaintiffs were the beneficiaries. The policies contained the following provision: “And the said association (the defendant) does hereby further promise and agree that after two years from the date hereof, the only considerations that shall be binding upon the holder of this policy are that he shall pay the annual dues and assessments at the times and places, and in the manner hereinafter stipulated, and that the regulations of the association as to age, occupation and employments shall be observed,, and that in all other respects, if this policy matures after the expiration of said tAvo years, this policy shall be indisputable.”
    The complaint stated that the insured died more than two years: after the date and delivery of the policy, and that he had paid all annual dues and assessments up to the time of his death.
    The answer did not deny the allegations of the complaint, but set. up as a defense, that certain material statements made by the insured, in his application for insurance, warranted to be true and entering; into the consideration on which the policy was issued, were in fact false, to the knowledge of the insured, and that knowledge of their falsity Avas not acquired by the defendant until after the death of the insured.

      I£. Wilber, for the appellant.

      W I. Washburne, for the respondents.
   Nan Brunt, P. J.:

An answer having been interposed in this action, the plaintiff, 'claiming that no defense whatever was set up by such answer, made a motion for judgment upon the'pleadings at a Special Term of this court.

It is true that in the notice of motion the counsel falls into the error, so frequently committed in this district, of not distinguishing between the Judges’ Chambers and the Special Term for the hearing of non enumerated motions, simply because the judge acting at Chambers also holds in the same room a Special Term for the hearing of non enumerated motions.

The motion was made at a Special Term, duly designated by the judges of this district to be held for the hearing of non enumerated .motions, and it, therefore, was heard in the proper branch of- the ■court.

The motion seems to have been unwittingly made under section ■537 of the Code, which provides that if a demurrer, answer or reply is frivolous, the party prejudiced thereby, upon a previous notice to the adverse party of not less than five days, may apply to the court, or to a judge of the court, for judgment thereupon, and judgment may be given accordingly.

The motion in question was a motion upon the pleadings for judgment, manifestly upon the ground that the answer contained no ‘defense, and was, therefore, frivolous, and this motion was granted.

The only difficulty in the disposition of this appeal is the length of the brief which has been submitted by the respondent, which would ;seem to indicate that he did not think the answer was frivolous, •although it manifestly is. The defense set up by the answer seems to have been expressly held to be unavailing in the case of Wright v. Mut. Benefit Life Ins. Assn. (118 N. Y. 237), between which ¡case and the one at bar we can see no distinction.

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

O’Brien and Eollbtt, JJ.,‘concurred.

Judgment affirmed, with costs.


author: "Van Brunt, P. J.:

text:
    Hermann Bolte, Appellant, v. August Fichtner, as Executor, etc., of Herman Schwannecke, Deceased, Respondent.

      Olaims against a decedents estate — employment as an attorney and. to sell real estate.

    On. a reference of disputed claims against a decedent’s estate, it appeared that the claimant, an attorney, had made a contract with the decedent to defend an action for him for a certain sum, a part to he paid in advance and the balance when the case was ended; that the claimant appeared in the cause, and the client thereafter died before the case came to trial; on the client’s death the claimant wrote to his executor that if he wished the claimant to represent him in the action he must pay a retaining fee, but did not inform the executor of the contract made with the decedent; the executor did not pay the claimant a retainer, but employed another attorney, to whom the claimant transferred the papers in the case, and who thereafter tried the cause; after the trial, the claimant presented to the executor a claim for payment on his contract with, the decedent.
    The referee decided against the claim.

      Held, that by not notifying the executor of the existence of the contract, and by allowing him to employ other counsel for the purpose of carrying on the litigation, the claimant had abandoned the contract, and, consequently, could not claim payment thereunder.
    The same claimant presented another claim against the estate, based upon an agreement of the decedent to pay him a certain commission if he should procure a purchaser for certain real estate at a certain sum, for cash. It appeared that the claimant did not find a purchaser on those terms, but he introduced evidence to show that he procured a purchaser on other terms, which terms the decedent accepted but afterwards refused to carry out.
    The referee found against this claim also.

      Held, that the testimony failed to substantiate the assertion that the decedent accepted the new terms of sale, and, consequently, that the finding of the referee against the claimant was correct.
    Appeal by tbe plaintiff, Hermann Bolte, from a judgment of tbe Supreme Court, entered in the office of tbe clerk of tbe city and county of New York on the 7th day of October, 1892, dismissing tbe plaintiff’s claim, and from an order made at tbe New York Special Term, and entered in said clerk’s office on tbe 27th day of September, 1892, confirming tbe report of tbe referee herein, and ordering judgment against tbe plaintiff, and from an order made at the said Special Term and entered on the 27th day of September, 1892, denying tbe plaintiff’s motion for a new trial.

      N. H. Stuwt, for the appellant.

      J. A. Straley, for the respondent.
   "Van Brunt, P. J.:

The plaintiff having presented to the defendant, as executor of Herman Schwannecke, deceased, his claim against the estate of said deceased for services rendered as attorney and counsel in a certain action brought against the deceased, and for a balance due for services rendered to him in and about the sale of a certain boarding house, such claim was disputed by the executor, and by consent was duly referred to a referee to hear and determine.

The referee found the employment of the plaintiff as the attorney and counsel of the deceased in said action and that the deceased agreed to pay the plaintiff for his services in said case $250 ; $50 in advance and $200 when the case was ended ; which terms were accepted by the plaintiff, and he appeared as such attorney and counsel; that the testator died on the 5th of March, 1890, pending said action, and that in June, 1890, the plaintiff abandoned his contract and neglected to perform the same, and, therefore, was not entitled to recover.

As to the second claim the referee found that the testator had entered into an agreement whereby he agreed to pay the plaintiff ten per cent if he would sell the testator’s place of business, 13 Oliver street, for $3,500 cash; that the plaintiff endeavored to find such a purchaser, but failed to do so, and the deceased died without the sale being made, and that no recovery should be had upon this cause of action.

The sole question presented upon this appeal is whether the referee’s findings are supported by the testimony. The fact of the employment of the plaintiff as the attorney and counsel of the testator, as found by the referee, was established by the evidence, and the terms of the contract were also established, as stated by the referee.

It appeared from the evidence in the case that at the time of the testator’s death the action in question had not been tried, and that on the 11th of June, 1890, the plaintiff wrote to the defendant, the executor of the deceased, as follows: “ Dear Sir — I was retained and employed by the late Herman Schwannecke to defend the above-entitled action. Mr. Chas. K. Lexow was attorney for the plaintiff, but I have quite recently received a notice of the substitution of Mr. Hiram Ketcham as plaintiff’s attorney. I would be pleased to confer with you relative to the action and ask you to call and see me about it.” On the 18th of June, 1890, the plaintiff wrote another letter to the defendant, as follows: “ Dear Sir — In the action of Gregory v. Schwannecke, I have been served with a notice of motion for an order allowing this action to be continued against the executors of the defendant. The motion is to be heard in City Court, Special Term, June twentieth, at ten o’clock, a. m. The notice is addressed to me as attorney for defendant and the representatives or successors in interest of Herman Scliwannecke, deceased. Now, if you wish me to represent you in this matter you must call at my office and pay me a retaining fee. I wrote to you a few days ago about the case, asking you to call on me, but thus far have not seen you. ■ The matter is important and you should attend to it at once.”

Prior to the 19th of June, 1890, other attorneys were employed by the executor, who, upon that date, wrote the following letter to the plaintiff-: “Dear Sir — Your letter of June 18, 1890, to Aug. Fichtner, has been handed us. "We have been retained by him and will attend to the motion.” On the 22d of October, 1890, the plaintiff transferred all the papers to the attorney selected by the executor. No intimation whatever was given to the executor of the contract with the testator, and although the plaintiff was present upon the trial of the action, it does not appear that he took any part therein.

W"e think that the referee was clearly right in holding that the plaintiff, not having notified the executor of the existence of this contract, and allowing him to employ other counsel for the purpose of carrying on the litigation, and thus having abandoned the contract, cannot now claim the sum which it is alleged was agreed to be paid. ;

In respect to the other cause of action, the evidence showed that the deceased Avas desirous of selling his business for cash, and asked the plaintiff to sell it for him for $3,500 cash, promising to give ten per cent of the amount if lie Avould so sell it. The plaintiff never found such a customer, but if the testimony offered on his part is to be 'credited, he produced a customer who was willing to pay $2,000 cash, and secure' $2,000 by notes and a mortgage, which offer the deceased accepted, and then refused to carry out. But we think that a reading of the testimony introduced to establish this accepted offer, being that of Blum, the proposed customer, and of White, a tenant in the plaintiff’s office, shows that it is utterly unreliable, and that no liability should be predicated thereon. Blum, in his testimony, places all the interviews with the deceased and plaintiff at Koster & Bial’é saloon; there'‘all the conversations are had, and nowhere else ; while White is equally positive that all these conversations took place in the plaintiff’s office, and not at Koster & Bial’s. To say the least of it, the testimony itself is suspicious upon its face; and when we are confronted with this direct contradiction of these witnesses, it seems to us that it entirely discredits this testimony of the acceptance upon the part of the deceased, of this proposed customer upon terms so different from those which he was desirous of obtaining for his place of business which he was about to sell. There seems to be no reason, therefore, for disturbing the conclusion of the referee.

The judgment and orders appealed from, should, therefore, be affirmed, with costs.

O’Brien and Follett, JJ., concurred.

Judgment and orders affirmed, with costs.


author: Per Curiam :

text:
    In the Matter of the Appraisement of Certain Legacies and the Assessment of Collateral Inheritance Taxes Thereon Under the Last Will and Testament of John Knoedler, Deceased. Roland F. Knoedler and Others, Appellants. Theodore W. Myers, Comptroller of the City of New York, Respondent.

      Collateral inheritance tax on proceeds of life inswrance policies.

    Where a policy of insurance on the life of a decedent is made payable to him or to his personal representatives, the proceeds thereof are subject to taxation, under the Collateral Inheritance Tax Law.

      Appeal by Roland E. Knoedler and others from an order of the surrogate of the city and county of New York, made and entered in the office of the surrogate on the 19th day of November, 1892,. affirming an order theretofore made by the surrogate and entered in his office on the 9th day of September, 1892, confirming the report of an appraiser in respect to the collateral inheritance tax upon bequests to the several appellants, under the will of John Knoedler, deceased.

      B. F. Watson, for the appellants.

      F. B. Olcott, for the respondent.
   Per Curiam :

We think that the order appealed from in this action should be-, affirmed, with costs, upon the opinion of the court below.

The opinion of the court below is as follows :

Ransom, Surrogate:

The deceased died in June, 1891, leaving a will by which, after the usual provision for his debts and funeral expenses, he gave the entire residue of his estate to his brother Michael, and in case of his. death before him to be divided in equal shares between his children and their issue. The brother predeceased the testator, leaving issue. Amongst the property which came into the possession of' tlie executors were four policies of insurance, three of which were-payable to the deceased, his executors, administrators and assigns,, the fourth being a paid-up policy payable to the decedent’s legal representatives.” When the matter of the appraisement came up,, the administrator, c. t a., claimed that the proceeds of these policies formed no part of the estate of the testator. It did not appear1 from the proofs introduced before the appraiser what the terms or character of the policies were, and it was remitted to the appraiser for the purpose of having this proof introduced. Sworn copies of' the policies were put in evidence before the appraiser and the-matter now comes up for determination. It is claimed on behalf of the administrator: 1st. That the interest of the testator in the: policies did not constitute property. 2d. That if they were property of the testator, he did not die seized 'or possessed of the same, and that, consequently, the proceeds are not subject to the pro-visions of the act taxing bequests. Before stating my conclusions, I -will refer to a few authorities not cited in the briefs of counsel, which, to my mind, are ^influential in ascertaining the true rule in ■cases of this character.

In The Matter of Van Dermoor (42 Hun, 326) the court states : If there were no beneficiary named in the policy, probably the amount received would be assets. But where there is a beneficiary, we think the amount received is not assets, for it belongs to the beneficiary, and not to creditors or legatees. And it belongs to her (if at all) not by virtue of any will of the testatoi-, or of any administration of his estate, but by a contract of the company under which they were to pay it (as she claims) for her benefit. The executor, therefore, has, in this particular (if the petitioner is right) no will of the testator to execute.”

Winterhalter v. Workmen’s Guarantee Fund Assn. (17 Pac. [Cal.] 1) was decided in the Supreme Court of California in March, 1888. .In this case the policy read, “ shall be paid to--subject to his will.” The insured never filled in the blank by inserting the name •of a beneficiary, but left a will whereby he bequeathed to his mother ■all his estate and effects. The plaintiff was named as executor. The application of the insured contained the following clause: I hereby authorize and direct that the amount of said guarantee fund to which I may be entitled, shall, at my death, be paid subject to my will.” The court said : “ The question presented for determination upon the facts is this: Is the executor entitled to recover -the sum due decedent, or does it go directly to his mother, Louisa Iioffmeister ? It may be stated that where a policy of life insur•ance expressly designates a person as entitled to receive the insurance money, such designation is conclusive in the absence ■of some question as to the rights of creditors. The receipt of the person designated will discharge the insurer, and he may .sue for and recover the amount due at the maturity of the policy. In such cases the legal representative of the insured has no claim upon the money and cannot maintain action therefor. It forms no part of the assets of the estate of the insured. * * * Nor was there any special designation of the mother of deceased as the beneficiary of the amount to he realized on this policy in the will of the deceased, except that all of his property was bequeathed to her after the payment of his debts and liabilities. * * * The simple part is that the testator has bequeathed the fund in question to his mother, subject to the payment of his debts, and as these can only be paid through the interposition of his executor, the court below was correct in its conclusion that the executor was a proper party to have and recover the fund out of which such debts, if any, are to be paid.”

In Georgia Home Ins. Co. v. Kinnier (28 Gratt. 88) a policy of insurance on a building insured K. and his legal representatives. The building having been burned after the death of K., his administratrix brought suit on the policy. The chief question was that the action should have been brought by the heirs of the plaintiff’s intestate. The court said : “ I do not think this is the proper construction of the policy. The policy declared upon and as set out is a contract to indemnify Alexander Kinnier personally. The words legal representatives,’ as used, are of the same import as the words, executors, administrators, personal representatives.’ The policy as set out is a simple contract, and upon the death of Alexander Kinnier passed, like his bonds, notes and other choses in action, to his administratrix, and she only had a right of action upon it.”

In Kelley v. Mann (56 Iowa, 625), by the terms of the policy, the amount Avas payable to the “ legal representatives.” The insured died intestate, leaving a Avidow and two children. The widow was appointed administratrix and collected the policy. Sections 2371, 2372 of the Code provide that “ the avails of any life insurance * * * are not subject to the debts of the deceased * * * but shall in other respects be disposed of like other property left by the deceased.” The court said: “ That a life policy is assets of the estate, the same as any other chose in action, cannot be seriously questioned. The only difference is in the manner of distribution. The general assets are liable for the debts of the estate, and the avails of life insurance are required to be paid to the wife and children of the intestate.” This last provision is, of course, by specific statutory regulation, and would not apply in this State. While there may be grave doubt as to the liability to the tax of the proceeds of a policy of life insurance Avhich is collected by a beneficiary specified in the policy, I do not think it can be seriously questioned that where the policy is made payable to the deceased, or to his personal representatives¡ that the proceeds form part of the assets of the deceased, and constitute a fund out of which creditors and legatees are to be paid; that these proceeds pass by the will of the decedent, or the Statute of Distributions, and are subject to taxation under the law. The interest of the deceased in the policies was property of which he was possessed during his lifetime. It was assignable and it is matter of common knowledge that merchants frequently obtain large credits, and to a considerable extent transact business upon the collateral security afforded by property of this character. Should the insurer become insolvent, or for any other reason wind up its affairs, the policy holder would be entitled to share in its assets. The fact that this interest which he has may lapse by reason of his failure to carry out the terms of the contract by the payment of premiums, or do any other act by which his interest is forfeited, does not deprive his interest of the character of property. It might as well be argued that a leasehold was not property of which a testator died possessed, because he was liable to forfeit the same by nonpayment of the rent. The claim is also made that the testator had no property rights in the policies which could be assessed at the time1 of his death; that these policies during the lifetime of the decedent aré but contracts enforcible only after the death of the decedent, and that it would be absurd to say that the decedent died seized or possessed of property in these policies when the thing could not be or become property until after he died. There are numerous cases holding that the policy is a chose in action, and to say that the fact that the proceeds could not be collected under the terms of the contract until the death of the insured deprived it of the character of property, is really as absurd as it would be to say that a promissory note'payable upon the death or after the death of the payee was not property of which he was possessed during his life and at his death. Submit order confirming appraiser’s report and assessing and fixing the tax.

Present — Van Brunt, P. J., and O’Brien and Follett, J"J. .

Order affirmed, with costs, upon the opinion of the court below.


author: O’Brien, J.: Yan Brunt, P. J.:

text:
    Caroline A. Middlebrook, Respondent, v. Mary E. Travis and Others, Appellants.
    Partition— trial of action, not barred by the pendency of another action commenced on the same day.

    The pendency of an action for partition, commenced by the service of a summons and complaint on certain of the defendants, and pleaded as a bar to another action for the partition of the same premises ready for trial first, the summons in which was served on certain of the defendants on the same day that the first-mentioned action was commenced, and the plaintiff in which, although a defendant in the other action, was not served with the summons therein until after the-commencement of his own action, does not constitute a bar to such latter action or to the granting of a judgment of sale therein.
    Appeal by the defendants, Mary E. Travis and others, from an interlocutory judgment of the Supreme Court, rendered at the New York Special Term, and entered in the office of the clerk of the city and county of New York on the 28th day of December, 1892, in favor of the plaintiff, for the sale in partition of the premises-, described in the complaint in an action brought for that purpose.

      Thomas Nelson, for appellant Travis.

      Ed/ward Wells, Jr., for appellant Mills.

      WilTÁam M. Powell, for the respondent.
   O’Brien, J.:

Apart from the question of costs, in view of the statement upon, the argument, which was not denied, that the premises have been sold for a satisfactory sum, no useful purpose is to be served by-interfering with the judgment under which such sale took place.

The defendants appellants insist that, having pleaded the peqdency of another action, this was fatal to the rendering of a judgment herein. It appears that the summons in both actions was served on the same day, and of the twenty-seven parties to both actions only ten are common to both, the difference in parties resulting from the plaintiff in this action having included the husbands of the tenants in common as parties, whilst in the action claimed to have been first, commenced and pleaded in bar, such husbands were not made parties, but tenants, under lettings of some part of tbe premises, were included as parties defendant.

While doubt has been expressed as to whether husbands of the owners of the fee are necessary parties, and while it is unquestioned that they are proper parties, it is evident that in these possessory actions tenants under lettings in possession should be joined in the action. The only point, however, urged upon this appeal is as to the effect of the defense of a former action pending upon the right to enter the judgment appealed from. The summons and the complaint in the action thus referred to were dated before the plaintiff therein had acquired any right to commence such action; and if we take the date of the commencement of the action to have been at the time of the service of the summons, then, as the summons in this action was served on the same day as the summons and complaint in the other action, and as the law does not regard fractions ■of a day, the judge was not precluded, upon this action being first ready for trial, from proceeding to judgment.

Moreover, when this action was commenced, there was no action pending against this plaintiff, because she was not served with the summons in the other action until after she had commenced her •own by the service of a summons on certain of the defendants.

We think, therefore, that, as it appeared upon the trial that a prior action was not pending between the same parties, the defense was not made out, and judgment was properly awarded to plaintiff. The judgment appealed from should, therefore, be affirmed, with costs and disbursements.

Follett, J., concurred.

Yan Brunt, P. J.:

The jffea contained in the answer of the defendant Travis,, that at the time of the commencement of this action there was an action pending in this court, brought by this appellant against the other parties to 'the action, with the exception of such as were husbands ■of some of the tenants in common, and also against the tenants in possession; and that certain parties (naming them) were tenants in possession and were not parties to this action, was a good plea in abatement.

Parties in possession of property sought to be partitioned are not only proper parties, but necessary parties, because, without their presence, their rights cannot be adjudicated upon in such a manner as shall be binding upon them. A party in possession, with an unrecorded deed, by his possession gives notice to all the world of the existence of his claim ; and if there is any outstanding claim by any person in possession the only way in which it can be cut off is by making him a party to the action where the premises are sought to be partitioned and sold. Therefore, if there are parties in possession, and such parties are not made defendants in the partition action, it is a defect which any of the defendants have a right to avail themselves of. And if the defendants in this action had proven that tenants in possession were not made parties, it would have been the duty of the court to have refused a decree until those parties had been brought in so that they could be bound by it. But the difficulty with the defendant’s position is, that although she has. alleged in the answer and requested the court to find that certain tenants in possession were not made parties, there is no proof of the fact, and it does not appear to be admitted anywhere in the record.

The claim in respect to the husbands of some of the tenants in common being necessary parties, cannot be supported, because a husband has no interest whatever in the real estate of his wife unless she dies possessed of the same, having had living issue of the marriage.

For the failure to prove the facts stated in the plea of abatement, it is necessary to concur in the opinion of Mr. Justice O’Brien for affirmance.

Judgment affirmed, with costs and disbursements.


author: Follett, J. :

text:
    In the Matter, etc., of Opening One Hundred and Sixty-seventh Street, in the Twenty-third Ward of the City of New York. The Mayor, Aldermen and Commonalty of the City of New York, Respondents, v. Lyman Tiffany and Another, as Trustees, etc., and Others, Appellants.

      Opening streets in Mew Torh city —• assessments on property benefited.

    Tiie provision of the statute (New York City Consolidation Act, Laws 1883, chap. 410, § 958) to the effect that where a street more than one mile in length is opened in the twenty-third and twenty-fourth wards of the city of New York, not more than one-half of the cost shall he assessed upon property benefited and that the city shall be liable for the remainder, has reference to tho street as laid out, and if the street, as laid out, is less than one mile in length and is of itself a perfect street, the owners of property benefited must bear the whole burden.
    This is so, even though the street was originally designed by the street department to be longer, and although other but disconnected streets or sections of the street as originally designed, bearing the same name as that of the originally designed continuous street, may have been laid out, which, if united to the street in question, would make the aggregate more than a mile in length.
    Appeal by Lyman Tiffany and another, as trustees, etc., and others, owners of the lands assessed in this proceeding, from an order of the Supreme Court, made at the New York Special Term, and entered in the office of the clerk of the city and county of New York on the 6th day of January, 1893, confirming the report of the commissioners of estimate and assessment in the above-entitled proceeding.

      Trumam, JT. Bald/win, for property owners, appellants.

      William JI. GlarTc% for mayor, etc., respondents.
   Follett, J. :

Property benefited by the opening of streets, not more than one mile in length, in the twenty-third and twenty-fourth wards, may be assessed to the extent of the benefits conferred, for the purpose of paying the cost of laying them out. But in case the streets laid out are more than a mile in length, not more than one-half of their cost can be . assessed upon property benefited, and the city is liable for the remainder. (Cons. Act, chap. 410, Laws 1882, §§ 6JJ-958.)

In 1811 the commissioners of Morrisania filed, a map showing a continuous street, now known as One Hundred and Sixty-seventh street, which w^as more than a mile in length, and extended from "Westchester avenue on the east to Jerome avenue on the west. From Westchester avenue to Prospect avenue, the distance is 2,945 feet. From Prospect avenue to Boston avenue, the distance is 1,554 feet. From Boston avenue to Olay avenue, the distance is 2,130 feet. From Clay avenue to Sheridan avenue is 2,280 feet. From Sheridan avenue to Jerome avenue is 1,520 feet.

From Westchester avenue to Prospect avenue the street has been legally laid out. From Prospect avenue to Boston avenue a street was once opened, but has been discontinued. From Boston avenue to Clay avenue a street has been laid out, and is known as a portion of One Hundred and Sixty-seventh street. From Clay avenue to Sheridan avenue there is no existing street. From Sheridan avenue to Jerome avenue a street lias been laid out, and is known as part of One Hundred and Sixty-seventh street. The distance between Westchester avenue on the east and Jerome avenue on the west, by the line of the street, as shown on the old map, is about 10,429 feet. The aggregate length of the three sections of the street legally laid out is 6,595 feet, or 1,315 feet more than one mile.

February 19, 1892, commissioners were appointed to assess the damages and benefits to the property, caused by opening a street from Westchester avenue to Prospect avenue, a distance, as before stated, of 2,945 feet. The assessment was made upon the basis that the proposed street was less than one mile in length, and that all, instead of one-half of its cost, was to be borne by, and was assessed upon the property benefited. There is no evidence in the case that the city proposes to unite the three sections of streets, known as One Hundred and Sixty-seventh street, so as to make a continuous street from Westchester to Jerome avenue, nor is there any evidence that the city intends to lay or continue a street between Prospect and Boston avenues, or between Clay and Sheridan avenues, so that any two of the sections of the street known as the One Hundred and Sixty-seventh street will be united and form a street more than a mile in length.

Mr. Greiffenberg, an assistant topographical engineer of the street department, who was the only witness examined, testified: That One Hundred and Sixty-seventh, street was originally laid out from Prospect to Poston avenue, but that it had been discontinued and canceled from the map, and forms no part of One Hundred and Sixty-seventh street. It was discontinued February 14, 1889. This evidence was not disputed.

The fact that the three unconnected sections or streets are known as One Hundred and Sixty-seventh, and aggregate more than one mile in length, does not require that one-half the cost of opening the east section, or street, be assessed on the city. Each of these sections or streets was opened on different dates, and each is a perfect street of itself, commencing and terminating at avenues. Neither is a oul de sao. There is no physical connection between these sections or streets, nor does it appear that a union is contemplated or practical, and there is no connection between them except the name. Had one of these sections been called Gold street, another Silver street, and the part involved in these proceedings One Hundred and Sixty-seventh street, it would not, we think, have been asserted that One Hundred and Sixty-seventli street was by reason of the existence of Gold and Silver streets, more than one mile in length, even though it had been originally contemplated that they should form a continuous street, bearing the same name. The section of the statute relating to the assessment of damages has reference to the length of the street as laid out. If, as opened, it is less than one mile in length, and is of itself a perfect street, the property owners must bear the whole burden, even though it was originally designed by the street department to be much longer.

The order should be affirmed with costs.

Yan Brunt, P. J., and O’Brien, J., concurred.

Order affirmed, with costs.


author: Eollett, J.:

text:
    John H. Ming and Charles K. Wells, Respondents, v. Austin Corbin, Appellant.

      Original entire contract, severed after part performance — defense — counterclaim — construction of writings.

    When an entire contract for the sale of two commodities has been severed, by-agreement, after the delivery of one of the commodities, the failure to deliver the other is not a defense to an action brought to recover the price of the commodity delivered, although the damages arising from such failure, if properly-set up, proved and assessed, might have constituted a counterclaim.
    When the construction and legal effect of writings, properly questions of law for the court, have been submitted to the jury and rightly decided, the fact that, they were determined by the jury instead of by the court does not constitute an. error for which a judgment will be reversed.
    Appeal by tbe defendant, Austin Corbin, from a judgment of tbe Supreme Court, entered in tbe office of tbe clerk of tbe city and county of New York on the 23d day of November, 1892, in favor of the plaintiffs, on a verdict, rendered at tbe New York Circuit, and from an order entered in said clerk’s office on tbe 7th day of December, 1892, denying tbe defendant’s motion for a new-trial made upon the minutes.
    This action was brought to recover tbe balance due on tbe purchase price of certain bonds of the par value of $5,300, issued by tbe, county of Lewis and Clark, in the Territory of Montana, and sold, in 1872 by tbe plaintiffs to tbe defendant at about eighty-two per cent-
    In March, 1872, one Sherwood was authorized by tbe plaintiffs tG sell for them $5,000 of tbe bonds of the county of Lewis and Clark,, and $5,000 of Territorial warrants at eighty-five per cent, and he: did sell $5,000 of each kind at that rate to the defendant..
    Sherwood’s authority and connection with the affair are disclosed by the letters of March 6 and 20, 1872, and the three telegrams of March nineteenth and twentieth, same year.
    “ Office of Austin Corbin, j 170 Broadway, } New York, March 6, 1872.

      “ Jno. H. Ming, Esq., Helena, Mont. Terr.:

    “ Dear Sir — I have an opportunity to place a limited quantity of county bonds or scrip drawing interest, and also Territorial scrip. 'Could use five thousand, face of Co. warrants, at 85 cts., and same :amt. Territorial at 85 cts. Now don’t get alarmed for this is no ■corner but simply through friendship. I am enabled to place above amts, at price and if you have same or portion and wish to dispose ■of them you can send them to me and I will handle them for you, guarantee money.
    “J. K. O. SHERWOOD.”
    “ Helena, Monta/na, 19, 1872.
    <£ Jas. K. O. Sherwood, Care Austin Corbin, 170 Broadway,

      N. Y. City:

    '“ Will sell five each bonds and territorial warrants, at eighty-five Tor face and interest, and give you two hundred. If wanted, ■•telegraph.
    “ J. H. MING & CO.”
    “ From New York, dated 20 March, 1872.
    To J. H. Ming & Co.:
    “ Send them, draw on me, ten days.
    ££ J. K. O. SHERWOOD.”
    “From New York, dated Mcurch 20, 72.
    To J. H. Ming & Co.:
    “ Send bonds cannot use warrants unless to be bonded in June.
    “ J. K. O. SHERWOOD.”
    “ Helena, Montana, March 20, 1872.
    J. K. O. Sherwood, Care Austin Corbin, Mew York:

    “Your two telegrams of the 20th are at hand. We will ship •$5,000 in bonds to-morrow night as we were unable to get them .ready for to-night’s coach. All territorial warrants issued prior to ^December 1st, 1871 (under which head ours come), are to be bonded in June at 12 per cent interest, but from the tenor of your second •dispatch we think you understand this fact, and are not certain whether ours are of the description or not. But as we are not certain about it, we will not ship till we hear further from you. As a matter of course we cannot allow you more than $100 for sale of ¡bonds» alone. In case you want the warrants you must let us know. ‘The bonds will reach you the day after this letter comes to hand.
    “ Yery truly yours,
    “J. H. MING & CO.”

      The foregoing correspondence was all between the plaintiffs and Sherwood, who acted for both litigants. After the date of the last letter Sherwood left the city of New York, and the subsequent correspondence was between the principals. At the time of this correspondence the usual time for the transmission of letters between New York and Helena was about ten days. "When the letter of March twentieth was received at New York does not appear, but probably about April first. April 9, 1872, the defendant sent .the following telegram to the plaintiffs:
    “New York, April 9th, 1872.
    “ J. H. Ming & Co., Helena, Montana :

    “ Send the five thousand Territorial warrants. County Bonds not yet arrived. Sherwood gone.
    “A. CORBIN.”
    “White River Junction, Yt., April 13iA, 1872.
    “ Messrs. J. H. Ming & Co., Helena, Monta.:

      “ Gentlemen — About six weeks ago I negotiated through Mr. J. K. O. Sherwood for $5,000 Lewis & Clark Co. Bonds and a like amt. of territorial warrants at 85 on prin. and accrued interest. I understood that the L. & O. were such as I had had before, 15 per cent. Never knew there were any other. Had no notion they were 12 per cent, and I do not think Sherwood had. On Wednesday last just as I was leaving New York for New England on business the $4,300 came from you, and a day or two before $1,000 from Phila. (without any advice as to what they were), making together $5,300. I was astonished to find that they were 12 per cent and at first thought I would hold subject to your order and write you. Of course they were not so good into fully 7£ per cent as what I supposed I had purchased, and I doubted if I could sell them at all to cover cost. On reflection, however, and fearing that a delay might work some inconvenience to you, I determined to place them if possible and at best rates without loss, hold funds subject to your order, and trust you to make the thing satisfactory when the ‘situation ’ should be fully understood. Acting upon that, I have sold them, and placed to your credit $4,400 which is subject to your check on me at sight, and I have directed my cashier to send you a check book as you requested. The balance of $41.77 I let remain open until I hear from you.
    “ In regard tó the interest I don’t think you can demand it after the trade was made. It was not my fault (nor yours) that the bonds were not delivered, but my advantage. If you can fairly ask interest of me, then I must hold my money idle in N. Y. waiting for them, and- you get interest on it, really, I have never paid it, nor had it charged on any bonds coming from there heretofore, and don’t believe I should pay anything after the purchase was concluded by telegraph. If fairly chargeable, then I should, and will. We will settle that satisfactorily. As to the adjustment of this matter generally, as to the misunderstanding, I shall leave it pretty much to you. You can see plainly enough that the bonds are worth, fully $350 less than I expected,' and I have finally sold them for only enough to let me out about even, and when I might as well have placed other securities paying me at least that much profit. I do not know that it is anybody’s fault that the thing was not better understood. Sherwood, I knew did not speak of there being 12 per cent and probably did not know it. I. did not, and you probably supposed we both did. I had never heard that any Co. Bonds there drew 12 per cent. It seems to be a very £ wide misunderstanding.’ Without anybody being particularly to blame, and under all the circumstances, I am willing to do my part to harmonize, so that no one will be very much the loser and all be content and to this end I will say that if you will discount $100 from the amount as you state it (including the doubtful item of interest, $36.77):
    Say............................................. $4,441.77
    Less............................................ 100.00
    Making net....................................... $4,341 77 and call the,bonds very well sold at that, as I know they are, I will be satisfied, and try to make up the deficiency on something else.
    “I would not give one cent over 80 for another lot of the same kind. Let me know if I am not, under all the circumstances, pretty reasonable. Yours truly,

      “A. CORBIN.
    ££ I received your letter as to territorial warrants, and ordered them forwarded (by telegram) some days ago.”

      The "Wednesday preceding April thirteenth was the tenth, on which date the defendant received $4,300 of the bonds of the county of Lewis and Clark, and a day or two before that, $1,000 of like bonds, as will be seen by the foregoing letter, by which it also appears that there was a misunderstanding between the contracting parties as to the rate of interest borne by the county bonds. To adjust the matter, the defendant offered to credit plaintiffs with $4,341.77. In the usual course of mail this letter reached the plaintiffs about April twenty-third, who, on the twenty-ninth of the same month, accepted the terms offered by the defendant in his letter of the thirteenth. The following is a copy of the plaintiff’s letter:
    “ April 29iA, 1872..
    “Mr. Austin Corbin, New Torh City:

    “Your favor of April 13th, notifying us of receipt of bonds is at hand. They were a long time on the road and we were quite anxious concerning them. The misunderstanding as to the kind of bonds we offered for sale we regret, and we certainly supposed Mr. Sherwood and yourself were posted as to the new issue of bonds, 12s, in accordance with a law of the Legislature of ’71, which forbids the issue of any bonds hereafter at a greater interest than twelve (12) per cent.
    “ Your letter states that you think that $4,341.77 which brings the bonds down to a net figure of about 81-Jc., would be fair for all concerned. In view of the fact that Sherwood’s telegram stopped the shipment of territorial warrants, a portion of which you could have used (as it afterward seemed) to good advantage, and that the transaction was conducted by you without any profit, we accept the change.”
    “New York, April 22d, 1872.
    “ J. H. Ming & Co., Helena, Montana:

    “ I have sold the territorial warrants and must insist upon delivery.
    “A. CORBIN.”
    “ The Corbin Banking Company, ) 115 Broadway, ) New York, April 23ci, 1872.
    “ Messrs. J. H. Ming & Co., Helena, Montana:

    “ Gentlemen — I was a good deal surprised to get your letter of 10th inst. yesterday, and I immediately telegraphed you that as I had contracted the sale of the territorial warrants, I must • insist upon having them.
    “ I purchased the bonds and warrants from Mr. Sherwood, who acted under < your telegram. The bonds were understood to be 15 per cent, and the warrants such as would be fundable into the new' bonds. After Sherwood left the office, and not knowing where to reach him, I dispatched you that the bonds must be fund-able warrants to meet the contract. Sherwood said they were, but I wanted to be sure on that point, and telegraphed you at my expense. You then wrote that they were fundable, but you did not send them along as you should have done. On receipt of your letter I telegraphed you to send.'
    “ I took the 12 per cent bonds and made no words about it, notwithstanding, I expected to have and purchased 15 per cent bonds. I was bound to take the warrants under the contract with Mr. Sherwood, and I cannot see why you are not bound to deliver them, and I cannot consent that it should be otherwise.
    “Yours truly,
    “A. CORBIN.”
    “ The Corbin Banking Company, ) 115 Broadway, \ New York, May 11, 1812.
    “ Messrs. J. H. Ming & Co., Helena, Mon. :

    “ Dear Sirs — A draft covering your balance was presented yesterday which I decline to pay. I presume you understand the reason, but that you may not misunderstand it, I write this to say that I consider my purchase of bonds and warrants one, and that L< am entitled to the delivery of both, and do not now propose to pay for either until I get both.
    “ I have examined all the dispatches and your letter, and I am at a loss to conceive on what grounds you can decline to deliver the warrants.
    “Yours truly,
    “A. CORBIN.”
    “ Íhe Corbin Banking Company, } 115 Broadway. j New York, May 13th, 18Y2.
    “ J. H. Ming & Co., Helena, Mon. :

    “Dear Sirs — :I have yours of the 29th ulto. I wrote you in relation to the warrants on Saturday. I regret exceedingly that we . should have any difficulty with regard to these warrants, but I cannot possibly see why you should decline to deliver them.
    “ Tou say that Sherwood’s telegram stopped the shipment of the* warrants, a portion of which I could have used to advantage. Let me repeat I bought through Sherwood $5,000 fundable warrants,, believing that they were fundable. On the receipt of a letter from the Territorial Treasurer soon after I learned that only a portion was fundable. Sherwood not being here, I telegraphed you not to send unless they were fundable. It is not possible, it seems to me, that you could have been mistaken ■ — • indeed I have your letter now in. my hand of the date the 20th of March, to Mr. Sherwood, in which you say ‘ that all Territorial warrants issued prior to Dec.. 1st, 1871 (under which head ours come) are to be bonded in June at 12 interest, but from the tenor of your 2nd dispatch we-think you understood this fact and are not certain ours are of this description or not, but as we are not certain about it, we will not ship until we hear further from you.’
    “ I bought fundable warrants. In that letter you expressly state: yours are of that character. My dispatch to you not to ship anything but fundable warrants must be construed by any reasonable, man that fundable warrants were what I bought. I wish to do exactly right in this matter, and not require anything wrong, but having bought the warrants fairly and contracted for their sale when reduced to bonds, I consider myself entitled to have them.
    “ Tours truly,
    “A. CORBIN.
    “ If your draft had been for $3,000 or $3,500 it would have been, paid, but I decline to pay for the bonds in full till I get the-, warrant.”
    The defendant credited the plaintiffs with $4,341.77, the price of the bonds as agreed on in the letters of April thirteenth and twenty-ninth, and June seventeenth paid $3,500 on account. This; action was brought to recover the balance, $841.77, for which, with, interest, the plaintiffs had a verdict.

      William J. Kelly, for the appellant.

      Charles N. Morgan, for the respondents.
   Eollett, J.:

Sherwood testified, and in this he was not contradicted, that the plaintiffs authorized him to sell bonds issued by the county of Lewis and Clark, of the face value of $5,000, and warrants issued by the then Territory of Montana of the face value of $5,000, at eighty-five per centum, and that he did agree for the plaintiffs to sell and thereafter deliver to the defendant such securities for •$8,500. This was an entire contract, and unless modified, the plaintiffs, not having performed it, were not entitled to recover, .All negotiations subsequent to the original contract were in writing, and their construction and legal effect were questions of law for the •court, but those questions having been submitted to the - jury and rightly decided, the fact that they were determined by the jury instead of by the courtis not an errror for which the judgment will '¡be reversed. (Thompson v. Roberts, 24 How. U. S. 233-240; Miller v. Eagle Life & Health Ins. Co., 2 E. D. Smith, 268; Cumpston v. McNair, 1 Wend. 457-463; Pangburn v. Bull, Id. 345-352; Hall v. Suydam, 6 Barb. 83-88; People v. O'Neil, 49 Hun, 423; affd., 112 N. Y. 355; 1 Thomp. on Trials, § 1020.)

We think the correspondence not only warrants but compels the •conclusion that there was at least a severance of the original contract. By that contract the plaintiffs agreed to sell, and the defendant to purchase, bonds of the county of Lewis and Clark, of the face value of $5,000, for eighty-five per cent. Subsequently, the plaintiffs •delivered bonds issued by that county, of the face value of $5,300, for which the defendant refused to pay eighty-five per centum, because they bore interest at the rate of twelve instead of fifteen per cent. However, the defendant by his letter of April thirteenth, agreed to pay $4,341.77, which was less than eighty-two per cent, which proposition the plaintiffs accepted by their letter of April "twenty-ninth. The defendant wrote to plaintiffs in the letter of April thirteenth, that $4,400 of the price agreed on was placed to "their credit, and subject to their check at sight. May 10, 1872, the ■defendant refused a draft for the full amount agreed to be paid for the bonds, and in explanation said, in a postscript to his letter of May thirteenth, that if the plaintiffs had drawn for $3,000 or $3,500 it would have been paid, but that he would not pay for the bonds in Lull until the warrants were received. June seventeenth the defendant paid the plaintiffs’ draft drawn for $3,500 against the price of the bonds. This is quite inconsistent with the position taken on the trial that the original contract had not been severed, and that the failure to deliver the Territorial warrants was a defense to a recovery of the purchase price of the bonds. It seems to us that the only debatable question, arising out of the correspondence and transaction, is whether that part of- the contract relating to the warrants was abandoned or rescinded. The decision of this question, depending as it did upon the construction of writings, was a question of law for the court, but which the court was not asked to determine. The defendant by his answer did not set up the failure to deliver the Territorial warrants as a defense to the plaintiff’s, cause of action, but as a counterclaim, and had the case been tried upon this theory, it may be that damages would have been allowed him. But on the trial, the defendant by his counsel insisted that the failure to deliver the Territorial warrants was a defense to the action, and asked that a verdict be directed for the defendant, and also that the complaint be dismissed. The court was not asked to rule that if the original contract had been severed, the plaintiffs were still liable in damages for their nonperformance of that part "relating to the Territorial warrants, which should be set off against the price agreed to be paid for the bonds. Neither was the court asked to instruct the jury to assess the damages sustained by the defendant by the nondelivery of the warrants, and set off the amount against the demand of the plaintiffs. The defendant insisted that if damages were sustained by him they amounted to' a defense instead of a counterclaim, and so he insists on this appeal, and we see no way of affording the relief which we might have been able to give, had the case been tried upon the theory of the answer, and damages denied him.

The judgment should be affirmed, with costs.

Van Brunt, P. J., and O’Brien,' J., concurred.

Judgment affirmed, with costs.


author: O’Brien, J.:

text:
    Etoile De Loraz, Respondent, v. Fanny Davenport McDowell, Appellant.

      Breach of contract of employment — offer of another employment — mitigation of damages ■— not an absolute defense.

    An offer of employment for an indefinite period, even if applicable in mitigation of damages, is not a defense to the entire cause of action, set forth in an action brought by an employee against his employer to recover damages for the breach of a contract of employment for a definite period.
    Hence, when in such an action the defendant does not rely upon the plaintiff’s refusal to accept such different offer of employment as a plea in mitigation of damages, but claims it to be an absolute defense to the entire cause of action, and on the trial, the engagement and discharge are not contested, and each side requests the court to direct a verdict, and the defendant makes no request to go to the jury on the question of damages, it is proper for the court to direct a verdict for the plaintiff.
    After such failure to request that the case be sent to the jury, the defendant cannot, on appeal, urge his offer of a different employment in mitigation of the damages as distinguished from a complete defense.
    Appeal by the defendant, Fanny Davenport McDowell, from a judgment of the Supi*eme Court, entered in the office of the clerk of the city and county of New York on the 23d day of December, 1892, upon a verdict in favor of the plaintiff directed by the court at the New York Circuit, and from an order entered in- said clerk’s office on the 24th day of December, 1892, denying the defendant’s motion for a new trial.

      I. M. Dittenhoefer, for the appellant.

      George M. Pinney, Jr., for the respondent.
   O’Brien, J.:

This action was brought to recover damages for the breach of a contract of employment. Plaintiff was engaged by the defendant in London in August, 1890, to perform in the United States the part of Iras,” in the play of “ Cleopatra,” for a season of twenty-eight weeks, commencing October 21, 1890. She was discharged on the eighteenth of August, whereupon this action followed, claim being made for her salary for the entire twenty-eight weeks.

The engagement and discharge were not contested on the trial, but as a defense, evidence was introduced to show that subsequent to the breach defendant requested the plaintiff to come from England to this country upon an offer to take parts in plays other than Cleopatra ” until such time as the latter was produced. This offer was cabled to plaintiff and agreed to, provided the engagement should be for twenty-eight weeks certain, and thereupon the position of defendant was defined in a letter from the counsel of the defendant to the counsel for the plaintiff, as follows :

“ Without acknowledging an agreement and for the purpose of avoiding litigation, Miss Davenport will take Miss De Loraz for her season commencing about the twenty-eighth of October, on the terms and salary Miss Davenport informed Miss De Loraz she would be willing to execute an agreement. She will not bind herself to-twenty-eight weeks, though the prospect is that the season may last that long. She is to appear in such plays as Miss Davenport may produce prior to Cleopatra,’ and subsequently in Cleopatra.’ ”

The respective positions of the parties at this date, therefore, was. that the plaintiff was willing to modify the agreement so as to take part in plays other than Cleopatra,” provided the engagement was; for the same definite period of twenty-eight weeks. Defendant, however, refused to make the engagement for twenty-eight weeks, certain, as was provided in the original agreement, or to name any definite time for the duration of the proposed new engagement. This being the condition of the evidence at the close of the case, the defendant moved for a direction of a verdict in her favor, which was denied, and subsequently the plaintiff moved for a verdict,, which was gnanted. No request was made by the defendant to go. to the jury upon any question whatever, the case being treated by her and her counsel as raising only a question of law to be passed upon by the court.

It remains, therefore, for us to determine upon this record, whether the indefinite offer made by defendant is a defense to the plaintiff’s entire cause of action, for the defendant, having treated the question as one of law only, and having made no request to be-allowed to go to the jury, cannot now urge her offer in mitigation of the damages as distinguished from a complete defense.

The learned trial judge, in disposing of the case, said: “ The defendant’s' season might not have lasted long enough to reimburse, the plaintiff for her passage money. The plaintiff was willing to. ■come for the originally stipulated period; but this the defendant refused. And the offer was not even for a less period definitely ■specified, but for the defendant’s season, which might have been long or short, according to the defendant’s success or caprice.”

Whitmarsh v. Littlefield (46 Hun, 418) holds that no duty is imposed upon one complaining of a breach of a contract, to surrender all his rights under his agreement and accept a new and different contract with a view to reduce the damages.

The rule of law contended for by the appellant is undoubtedly sound, that when a servant is wrongfully discharged, he must make reasonable efforts to obtain other employment, and credit the master with the amount earned by him in reduction of damages. He is not bound to accept employment of a different character, though it need not necessarily be of exactly the same kind or at the same salary. No fault is to be found with this statement of the rule, but upon the case as it is presented on appeal it has no application. If the defendant, instead of moving for a verdict, had requested to go to the jury upon the damages, then there might be presented a situation calling for the application of the rule. As already noticed, however, the defendant did not rely upon the plaintiff’s refusal to accept another and different contract of employment as a plea in mitigation of the damages suffered by the plaintiff, but as an absolute defense to the entire cause of action. In other words, the defendant seeks to maintain that a contract for an indefinite period, terminable at her own will, is as good in the eye of the law as a contract for a certain definite period. This statement alone sufficiently disposes of appellant’s contention; nor is there anything in the case of Bigelow v. American Forcite Powder Mfg. Co. (39 Hun, 599), which is in conflict with this view or with the rule as laid down in Whitmarsh v. Littlefield (supra).

We think, therefore, that both sides having requested the court to pass upon any questions of fact that may have been in the case, and both having relied upon their right to have a verdict directed in their favor, and, as shown, the defendant not oemg entitled to have such motion granted, and no request having been made to go to the jury upon the question of damages, it was proper, upon the case as it then stood, for the court to direct a verdict for the plaintiff, and in this disposition we find no error.

As there are no other questions presented upon this appeal, the judgment must be affirmed, with costs and disbursements.

Yan Brunt, P. J., and Follett, J., concurred.

Judgment affirmed, with costs and disbursements.