text:
    HUGH D. COTHRAN, et al., Plaintiffs and Respondents, v. THE HANOVER NATIONAL BANK OF NEW YORK, Defendants and Appellants.
    I. DAMAGES.
    1. Chose in action, convebsion of.
    (a) Promissory note, bill of exchange, cbe.

    1. Measure of damages prima fade is the amount due upon it.

      (a) Mitigation, insolvency.

    1. In mitigation of damages it may be shown to be of little or no value by reason of the insolvency of the parties, or for any other cause.
    H. SUPPLEMENTAL ANSWER. MOTION FOR LEAVE TO' SERVE.
    1. Defense.

      (a) What may be properly allowed to be set up by supplemental answer.
    1. In an action for damages for the conversion of a chose in action, facts showing it to have been of little or no-value at the time of the conversion, may be allowed to be so set up in mitigation of damages.

    3. Laches.
    If the defendant is ignorant of the matters at the time of his answer, and moves without delay after discovering them, he is not guilty of laches.

    3. Falsity, when motion not to be denied by season of ALLEGATION OF.

      (a) Where the opposing papers deny insolvency, but it appears that the draft, the parties to which were claimed to have been insolvent, was not paid at maturity, and other matters appeared tending to show insolvency, a ease is presented for a disposal of the question by trial.

    Before Curtis, Sedgwick, and Van Vorst, JJ.

      Decided February 7, 1876.

      Appeal from an order denying defendants’ application for leave to file a supplemental answer.
    The action is for the conversion of a draft, dated July 1, 1873, drawn by McWilliams & Co., on and accepted by the Cornwall Iron Works, for two thous- and six hundred and seventy-five dollars and twenty-one cents, at ninety days after date, to the order o«T the drawers, and by them endorsed. The allegations of the complaint are, that the plaintiffs being owners of the draft so accepted, endorsed it in blank, and sent it to defendants for discount; that the defendants did not discount the draft, and have not returned it to plaintiffs, and that before its maturity the draft came into the hands of a purchaser in good faith and for value, and plaintiffs thereby became liable to pay it. By its answer defendants admitted that it received the draft and did not discount it, but delivered it in good faith to one Maguire, whom it believed to have authority to receive it. It also denied the conversion, and the alleged facts by which plaintiffs claimed to have been made liable by reason of their endorsement.
    In April, 1875, defendants having learned that the plaintiffs had been adjudged bankrupts, moved for leave to plead the fact of transfer of the cause of action by virtue thereof to the assignee in bankruptcy. On the adoption of the action by the assignee in bankruptcy, the motion was denied. Thereafter the action was continued by the assignee, in the name of the plaintiffs.
    On facts alleged to be newly - discovered, the defendants applied for leave to interpose a supplemental answer, and from the order denying" that application, this appeal is taken.

      Tracy, Olmstead & Tracy, attorneys, and Charles E. Tracy, of counsel for appellants, urged :
    I. It was shown by affidavit, not controverted, that at the time ■of making its answer, the defendants were ignorant of the facts stated in the proposed supplemental answer.
    II. The insolvency of the makers and acceptors of "the draft clearly might be proved in mitigation of •damages (Sedgwick on Damages, 488 ; Ingalls v. Lord, 1 Cowen, 240). That the draft had not been actually paid -by any one of the parties thereto, and had not been proved in bankruptcy against the plaintiffs, were ■also facts admissible in mitigation of damages. For if proven, the plaintiffs could only recover on one of two grounds; first, that they had been deprived of their claim upon the draft, in case it was good in their hands as against the other parties; or, second, that by •reason of their endorsement of the draft, they had •come under liability to a third party. In neither case ■could the plaintiffs recover the full amount of the draft; in the first, they could recover only what they had lost, because that was the value of the draft; in ■the second, only the dividend which the assignee in bankruptcy should pay, because the plaintiffs’ cause •of action is his, and his damages are not greater than the dividend in bankruptcy to the third party. These last two facts, if proven, reduce the cause of action to one for nominal damages only.
    III. New matter constituting a partial defense must be pleaded, even though it be only in mitigation of damages (McKyring v. Bull, 16 N. Y. 308 ; Bush v. Prosser, 11 Id. 347 ; Joland v. Johnson, 16 Abb. 239 : Beckett v. Lawrence, 7 Abb. N. S. 403 ; Wehle v. Haviland, 42 How. Pr. 399, 407).
    IV. Ordinarily the court will not try the truth or falsity of the supplemental answer upon such a motion, and it never does, unless it is clearly a sham ■pleading. The fact that the draft had not been paid •at maturity by either of the parties is admitted, and no reason is shown for its non-payment; presumptively, therefore, the parties were not able to pay, and were insolvent (In re Bininger, 7 Blatchford, 264; Herrick v. Borst, 4 Hill. 652).

      Anderson & Man, attorneys, and Frederick H. Man, of counsel for respondents, urged
    I. The first matter in defense sought to be pleaded by the supplemental answer, viz., that all parties to the draft were insolvent at and before its maturity, is disproved. In this aspect of the case, the motion was properly denied (Morel v. Garelly, 16 Abb. Pr. 269).
    II. The second matter in defense sought to be pleaded by the supplemental answer, viz., that plaintiffs had been adjudged bankrupts, and that the draft had not been proved as a debt against their estate (they being liable on it by reason of their endorsement), does not constitute any defense at all. First. If plaintiffs have not been discharged in the bankruptcy proceedings, they would be still liable on their endorsement of the draft. No allegation is made as to their .discharge in the proposed supplemental answer. Second. It clearly appears that plaintiffs paid full value to McWilliams & Co. for the draft; they have, therefore, by the alleged conversion of it by defendants, lost actual property, and whether they are liable or not as endorsers, is immaterial. In this aspect also of the case, the motion was properly denied (Morel v. Garelly, supra).

    III. There is palpable laches on the part of defendants in delaying this motion until now. The complaint was verified August 28, 1874; the amended answer was verified November 25th, 1874, eleven months before this motion was made.
    IV. Leave to serve a supplemental pleading is a matter of discretion, and that discretion may be exercised, and the motion for leave denied, on the above grounds, and also where the new matter desired to be set up does not constitute a good cause of action, or a good defense (Morel v. Garelly, 16 Abb. 269 ; Holyoke v. Adams, 59 N. Y. 233). And where the papers show a case for the exercise of discretion, the court, on appeal, will not interfere with the discretion exercised at special term (Holyoke v. Adams, 59 N. Y. 233).
   By the Court.—Curtis, J.

The proposed supplemental answer alleges the insolvency of the makers, acceptors, and endorsers of the draft at the time of the alleged conversion. Also that the draft had not been actually paid by either of the parties thereto; and that no claim against the plaintiffs’ estate upon the draft has been proved in bankruptcy.

The suit is brought to recover damages for the alleged conversion of a chose in action. Where it is brought to recover for the conversion of a security, as in the present case, the measure of damages is the amount due upon it. But when the draft is of little or no value, by reason of the insolvency of the parties to it, or for any other cause, it is held that the defendants should be allowed to reduce its valuation by evidence of such facts, in mitigation of damages (Potter v. Merchants’ Bank, 28 N. Y. 641; Ingalls v. Lord, 1 Cow. 240).

The defendant seeks to reduce its liability by showing that the draft was of no value at the time of the alleged conversion, by reason of the matters stated in. the supplemental answer.

If the defendants were ignorant of these facts at the time their answer was made, and, after the discovery of them, proceeded without delay to apply for leave to plead them in a supplemental answer, then this application appears to come within the scope and terms of the 177th section of the Code.

The uncontroverted affidavit of the defendants’ cashier alleges such ignorance at the time when defendants’ answer was made, and also that he has only recently discovered the facts alleged in the proposed supplemental answer.

The affidavits, on the part of the plaintiffs, deny the alleged insolvency of the parties to the draft, but in view of the failure to show any payment of the draft at maturity, and other matters appearing in the papers, it can not be assumed that the facts alleged in the proposed supplemental answer are false, and that the application should be denied for that reason. On the contrary, it presents a question to be disposed of upon the evidence that may be presented at the trial of the issues.

The order appealed from should be reversed, with costs to defendants to abide the event of the action.

Sedgwick and Van Vorst, JJ., concurred.


source: Caselaw Access Project

author: By the Court.—Sedgwick, J.

license: Public Domain

text:
    ANN ELIZA MITCHELL, Executrix, et al., Plaintiffs and Respondents, v. THE VERMONT COPPER MINING COMPANY, et al., Defendants and Appellants.
    ASSESSMENT UPON THE CAPITAL STOCK OF A CORPORATION BY THE DIRECTORS THEREOF.
    Sale of said stock, when the owner thereof neglects to PAT THE ASSESSMENT.
    Validity of sale depends upon the same being made strictly within the powers authorizing the same, namely : the law of the state wherein the corporation exists, and the charter and by-laws of the corporation,
    A corporation can not enact or pass a by-law, or any rule or resolution for its government, except within the state under whose laws it is organized, and where it has a corporate existence.

      Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal from judgment entered upon the decision of a judge at special term.
    The plaintiffs’ testator had been a stockholder in the Vermont Copper Mining Company, defendant. That company had sold, or claimed to have sold, the stock of the testator, for non-payment of assessment thereon. The defendant Ely had bought, or claimed to have bought, the stock, at the sale. The defendant Ely was also president, and the defendant Bicknell, treasurer, of the company. The plaintiffs demanded judgment that the defendants, the company and Ely, might be enjoined from consummating the sale, and from causing or permitting certificates of the stock to be issued, and that the defendants Ely and Bicknell be restrained from signing or issuing any certificate, &c., and that, the pretended sale be annulled.
    Nothing turns upon the form of the remedy or upon the validity of the assessments upon the stock. No> special argument as to either was made upon this appeal.
    The company was incorporated by the laws of Vermont. Its board of directors made an assessment of twenty cents upon each share of its stock. This assessment was part of an assessment of fifty cents, previously authorized, and thirty cents having been imposed. Both assessments were made under the following by-law of the company, viz.:
    The directors shall have the power to assess the stock, not to exceed fifty cents per share, to fnrnish means for carrying on the operations, or paying the debts, of the company, and in case any stockholder shall neglect or refuse to pay such assessments, shall empower the treasurer to sell by public auction the shares of such delinquent, pursuant to section 12 of chapter 86 of the general statutes of the state of Vermont.

      This twelfth section provided, “That when any proprietor of any private corporation shall neglect or re-fuse to pay any tax or assessment duly laid or assessed by said corporation, agreeable to the by-laws thereof, the treasurer may sell by public auction the shares of such delinquent, under such regulations as the corporation by its by-laws may direct,” and further, that “The excess, if any, after paying such tax or assessment and all proper charges, shall be paid by the treasurer to such delinquent on demand.”
    The board of directors adopted the following resolution : “ Whereas an assessment of thirty cents a share upon the capital stock of this company was laid payable on February 15 last, and another assessment of twenty cents per share payable on August 8 last, and whereas said assessments have not all been paid, therefore Resolved, that the treasurer is hereby empowered to sell the stock upon which said assessment shall remain unpaid, at public auction, in accordance with the by-laws.”
    Afterwards, at a meeting of the stockholders in the city of Yew York, the following amendment was made to the by-laws :
    “ When the stock of any stockholder shall be ordered by the directors to be sold for unpaid assessments, such sale is to be made in the city of Yew York, by such auctioneer as the board shall direct, and between eleven and three o’clock of the day, and notice thereof to be given, at least ten days before the sale, to the delinquent shareholder, either personally or by mail, and also by publication for a like period in one or more of the daily newspapers of the city of Yew York.”
    It was proved that the company published the following notice, signed by the treasurer:
    “ The following described shares of the capital stock of the Vermont Copper Mining Company,, standing in the name of the following parties, viz. (here was inserted the description of the shares belonging to several alleged delinquents, among them those of the plaintiff’s testator), will be sold for the payment of assessments due thereon, by Albert H. Nicolay, at public auction, on Monday, September 17, at one o’clock, p.m., at the office of the company, at No. 191 Broadway (room 11). By order of the board.”
    The judge found as facts:
    That on September 17, 1866, the said ten thousand nine hundred and forty-one shares of the said Samuel L. Mitchell of the stock of the said company were •exposed for sale by the company, at their office, in the third story of the building, No. 191 Broadway, in the city of New York, for non-payment of the said assessment of twenty cents a share. Notice of such sale was ■publicly given in two of the daily newspapers of the city •of New York, at least ten days before the sale ; but no notice was received by the said Samuel L. Mitchell, -either personally or by mail, nor is it satisfactorily proven that a notice was mailed to him. He, however, saw the publication before the sale. That no auctioneer was directed by the board of directors of said company to make such sale, and that no other action on the part •of the said company or its board of directors in respect •to said sale took place than as has been hereinbefore stated. That at such sale the whole ten thousand nine hundred and forty-one shares of stock of the said Samuel L. Mitchell were put up, and that the whole thereof were knocked down to the name of the defendant Ely, atone dollar and fifty-two and a half cents a share. That the defendant Ely was at the time the president and a director of the said company.
    That prior to said sale the said Samuel L. Mitchell had objected to pay the said assessment of twenty «cents a share upon his ten thousand nine hundred and forty-one shares of stock, but that he had stated to the said Ely, the defendant, that if he, as president of the said company, would assure him, .the said Samuel L. Mitchell, that the accounts of the treasurer were correct, he would pay the -said assessment, and that the-defendant Ely had declined to give such assurance.
    The learned judge further found as facts, that j ust before the sale took place, the plaintiffs’ testator directed his check to be drawn for the amount of the assessments, and the same was by his further direction tendered, at the office of the company, to the defendant Ely, as president, in payment of the assessment; that the defendant Ely declined to receive the same, made-no objection to the check or to its amount, but said that it would affect the sale to have the stock of the plaintiffs’ testator then withdrawn, that he would buy-in the stock, and the assessments could then be paid ; that the stock was knocked down at the sale to file-name of the defendant Ely, and that after the sale, he requested the agent who made the tender to inform plaintiffs’ testator and to desire him to send the company the amount of the assessment; that notwithstanding this the said agent, as further directed, publicly protested at the sale against the sale of the shares belonging to plaintiffs’ testator; that the defendant Ely did not pay for the stock, in whole or in part, and had not, down to the trial; that after the sale, and as late as the year 1868, defendant Ely requested the testator of plaintiffs to pay the assessment,., and stated that upon the payment, the stock would be-his ; that, at a meeting of the directors, at which defendant Ely was present, May 15, 1868, it was resolved that the stock of Mr. Mitchell (plaintiffs’ testator),, bought, by Mr. Ely, at a sale for assessment, on September 17, 1866, “ having been by him repeatedly offered to the company at the cost to him, we accept his proposition and the stock held by him subject to our order.’*' This resolution was rescinded on August 16, 1868.

      The judge further found, “that it was not proved that any written note or memorandum was made or given in respect to the said alleged sale, and it was proved that no payment was made on account.”
    The judge found as matter of law :
    1. That the purchase of the stock by Ely, a director and president of the corporation, was ineffectual to make a valid sale of the stock, unless the same should be adopted or approved by Mitchell, the stockholder, and that he not having approved of, adopted, or acquiesced in said sale, was not, nor are the plaintiffs bound thereby.
    2. That to sell the said stock for the non-payment of an assessment, required that the sale should be made after due notice of ten days to the stockholder, and by an auctioneer directed by the directors, and that the said sale of September 17, 1886, was irregular for the want of such direction and notice.
    3. That to make a valid and binding sale of such stock for the non-payment of an assessment, required a written note or memorandum signed by the purchaser, or by some other person by his authority, or a payment of fifty dollars on account, and that the purchase claimed by the defendant Ely was invalid for want of these requirements.
    4. That to entitle the defendant Ely to claim the purchase of the said ten thousand nine hundred and forty-one shares of stock, required that within a reasonable time from September 17, 1866, he should pay for the same, inasmuch as it was upon payment by him alone that the said Samuel L. Mitchell would be entitled to receive the surplus over the amount of the claimed assessment.
    5. That however the preceding propositions of law might be, the tender by the said Samuel L. Mitchell of the amount of the said assessment prior to the sale, put it out of the power of the said company to make a valid or effectual sale of the said ten thousand nine hundred and forty-one shares of stock.
    6. That the plaintiffs, who are the executrix and executors of the said Samuel L. Mitchell, who, pending this action, has died, are entitled to judgment, and to the judgment herein ordered, and that it be and is adjudged that the defendants, the Vermont Copper Mining Company and Ely, be enjoined and restrained from taking any proceedings for the consummation of the said pretended sale, and from causing or permitting certificates to be issued for the said stock ; that the defendants Ely and Bicknell be enjoined and restrained from signing or issuing any such certificates ; that the said pretended sale be vacated and annulled; and that the plaintiffs recover of the defendant Ely the costs of this action.

      Moses Ely, for appellants.

      John E. Parsons, for respondents.
   By the Court.—Sedgwick, J.

It was not contended that, under the statute of Vermont, there was a forfeiture of the stock upon non-payment of the assessments. It was tacitly conceded that the title of the delinquent would not pass from him until a sale had been made, by valid proceeding, under the statute, to a purchaser. The statute provided that any excess of the purchase price, beyond the assessment and all proper charges, should be paid to the delinquent. Down to the sale, the interest of the company was the amount of the assessment and the proper charges, and the company had not a title to the stock. Therefore the plaintiffs were entitled to the stock and the evidences thereof, unless the proceedings to the sale were those made by law, to divest the title, or if before a sale there was a tender to the company of the amount of the assessments and charges. It must be conceded that the steps contemplated by law must be made in strict compliance with the law.

The validity of the sale depends upon compliance with the by-law of December 19, 1859, passed in the city of New York, in connection with the other by-laws and statute, or upon a construction of such other bylaws and. the statute, apart from the by-law of December 19, 1859.

I think the learned judge was correct in deciding, that after the plaintiffs’ testator (who was alive at the time of trial) had shown his general title to the stock at a former time, and that he had received no notice of the sale, either personally or by mail, the burden of proof was upon the defendants to show the taking of all the steps necessary for the passing of the title. The answer claimed that there had been a sale. Perhaps not so much was necessary to place the burden of proof upon the defendants. The defendants examined witnesses to show that notice had been given through the mails. The testimony was not positive or definite as to the particular notice to the plaintiffs’ testator. It was of a general kind, that all the notices had been sent by mail to the delinquents. How much of the testimony, as to the particular notice, was an inference by the witness, and how much doubt, if any, there was in the witness’s mind, was perceived by the judge before whom the witness was in person, and can not be estimated as well by an appellate court. His judgment on the subject must be final, as it would have been if he had given a greater weight to the testimony on this point. It is the fact, then, that the notice by mail, or personal, was not given, and the defect is fatal. The defect is not cured by the proof that the notice, as published, was seen by the plaintiffs’ testator. He could rest upon the law that such a notice, alone, would not support a sale that would divest his title.

It is claimed, however, and correctly, that the bylaw of December 19, 1859, was invalid as such,, because being in the nature of a corporate act, it was passed in New York, out of Vermont, in which alone a corporate act would be valid. But in looking to the other by-laws made in Vermont, and to the statute off that state, we see that the sale was not authorized by them. There was a resolution of August 16, 1865, referring in part to the present assessment, “that the-treasurer is hereby empowered to sell the stock upon which said assessments shall remain unpaid, at public auction, in accordance with the by-laws.” The only by-law in evidence is, after giving the directors-power to assess, that the directors “in case any stockholder shall neglect or refuse to pay such assessment, shall empower the treasurer to sell by public auction the shares of such delinquent, pursuant to section 12 of chapter 86 of the General Statutes of the state of Vermont.” The statute itself was that “ the treasurer may sell by public auction the shares of such delinquent, under such regulations as the corporation by its by-laws may direct.” By the statute and by the by-laws no sale could be made without regulations for it being first made by the by-laws.' There were no such regulations, and there could, therefore, be no valid sale.,

I think also that the tender of the amount of the assessment as against the company and the defendant. Ely, who had knowledge of the tender, availed to deprive the company of power to proceed (after it was-made) to sale, even if the proceedings were regular. As to whether, in fact, the tender was made, we are-content with the finding of the judge, supported as it is by one positive witness and corroborating circumstances. We have seen that the title of the stock was: in plaintiff’s testator, and that it was only charged with the right of the company to obtain by its sale the amount of the assessments and proper charges. The rights of the company would have been satisfied and discharged by a payment. The rejection of the tender was not placed upon a deficiency of amount, or that it was not in money. Strictly there should have been an offer to pay the charges, and proof of ability .and readiness to do it, upon being informed as to what they were. The necessity for this was obviated by the defendant Ely saying, among other things, that he would buy-in,for plaintiff’s testator, and the assessment could be paid afterwards ; that it would break down the sale to withdraw those particular shares, &c., &e.

This being true, however, if the judgment below could be supported on no other ground than that of tender, it should have provided that the tender should be kept good, and the plaintiff pay the money and interest and charges as a condition of relief. Equity would not require this, however, if the alleged or attempted sale was invalid for want of legal proceedings, or if, in fact, the sale was only colorable, ¡and not, in fact, a sale as between the company and the defendant Ely. In neither case would any right -of the plaintiff rest upon the making of the tender.

I do not think it expedient in this case to examine whether the mere fact of there being no contract of sale under the statute of frauds, binding the company and defendant Ely, would of itself give the plaintiff a right to claim that no sale had taken place or was invalid for that reason. But undoubtedly the learned judge was right in giving attention to the fact that the defendants had not proved such a contract. That fact with others, viz., the declaration before the sale that it would be bought in for the plaintiff’s testator, the subsequent declaration that he might still have the ¡stock upon the payment of the assessment, the resolution of the company, at which defendant Ely was present, afterward rescinded, that the stock of Mr. Mitchell, bought by Mr. Ely at a sale for assessment, “having been by him repeatedly offered to the company at the costs to him, we accept his proposition and the stock held by him,” and the non-payment by defendant Ely of the purchase-money—was evidence as to whether the sale that took place was meant to be more than a form, and whether either party had an intention to make a sale or purchase. These facts, too, might all be weighed on the question as to the tender. I do not, however, proceed in supporting the judgment upon the mere fact that there was no real sale. It is not necessary, and it may be that the judge below had no such question by itself before him. The judgment below can be affirmed on the invalidity of the sale under the statute of Vermont and the by-laws of the company.

In what has already been said, the propositions made in the strong argument by appellant’s counsel have been considered directly or inferentially for the most part. He particularly urged that a tender to defendant Ely was not a tender to the company, because there was no evidence that he had charge of the fiscal concerns, and had no implied authority to receive money in payment of indebtedness. The proposition of law involved might be sound, yet we should consider that there was evidence that at the time of the tender the treasurer of the company was standing by, so that he was able to testify to what took place at the interview, although his remembrance of it was not the same as that of a witness for the plaintiff.

It is unnecessary to give attention to the argument, in relation to the conclusion of law by the judge, “that the purchase of the stock by defendant Ely, a director and president of the company, was ineffectual to make a valid sale of the stock, unless the same should be adopted or approved by Mitchell, the stockholder, and that he not having approved of, adopted, or acquiesced in said sale, was not, nor is the plaintiff bound thereby.” An examination of the law on this subject is not required in this case, as we have come to the conclusion that the sale was invalid for other reasons.

The judgment should be affirmed with costs.

Curtis, J., concurred.


text:
    WILLIAM NELSON, Jr., Plaintiff and Appellant, v. THE SUN MUTUAL INSURANCE COMPANY, Defendant and Respondent.
    marine insurance.
    A policy that states in the written portion the sum insured and the risk taken in the following words: 1 ‘ Sum insured six thousand two hundred and fifty dollars, port risk in port of New York, upon the body, tackle, apparel, and other furniture of the good ship called “The Confidence,” designates only such risk as is defined by the words “port risk in the port of New York,” and designates no risk upon any part of a voyage to be made by the ship.
    Oral proof may be given to establish what the risk was, and to show what risks were covered under the words “ Port Bisk.”
    The commencement of a voyage from the port of New York terminated the risk under such a policy.
    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal from judgment dismissing complaint.
    The action was upon a policy of insurance, which in form was a marine policy. The written part insured the plaintiff “at and from October 5, 1867, at noon, to November 5,1867, at noon. Sum insured six thousand two hundred and fifty dollars, port risk, in port of New York, upon the body, tackle, apparel, and other furniture, of the good ship called ‘ The Confidence,’ ” Then followed the printed part, such as is generally used in a voyage policy, a valuation being inserted. The spaces left for the termini of a voyage were blanks. The clause commencing “Touching the adventures and perils, which The Sun Mutual Insurance Company is contented to bear,” ended,- “and all other perils, losses,, and misfortunes that have or shall come to the hurt, detriment, or damage of the said vessel or any part thereof.”
    The answer averred that the loss did not happen during the continuance of any of the risks taken by the defendant, but after the ship, completely prepared for a voyage, had broken ground, and had commenced her voyage.
    On the trial before a judge and jury, it appeared that on October 28, 1867, the ship was laden, manned, and equipped for a voyage to Glasgow, and was moored to a wharf or pier for the purpose of proceeding on her voyage. The moorings were cast off, and a steam-tug took a hawser from the ship to tow her and did begin to tow her out of the pier. Before the ship had been towed more than twice her length, she was ■caught by a strong tide, which swung the ship round so that she struck heavily on the reef near Jackson Ferry. She struck twice. Her keel and bottom were damaged, and for this the action was brought.
    Against the objection and upon the exception of the plaintiff, the defendant was allowed to ask several witnesses, who were underwriters or officers of marine insurance companies, what was the meaning of the term “port risk” in the business of insurance. One answer was, “'a risk on the vessel while in the port of New York, as distinguished from a voyage risk.” The plaintiff gave testimony that he was a merchant, and accustomed to insure a great deal; and to the question, “ What do the words ‘ port risk in the port of New York’ among underwriters and merchants mean?” he said it “ covers all marine risks while the ship is in port.” Other testimony on this point was given on both sides.
    On the whole case the court dismissed the complaint, on the ground that the “ port risk” as used in the policy had ended before the striking upon the reef, -the ship then having begun a voyage.

      George A. Black, for appellant.

      Joseph G. Choate, for respondent.
   By the Court.—Sedgwick, J.

If all the printed parts of the policy which specify the risks insured ■against are disregarded because they in words refer to a voyage, no voyage being described in the policy, then the only risk designated by the policy is such •as is defined by the term “port risk.” I learn from Dows v. Howard Ins. Co. (5 Robertson, 481), that on the continent of Europe, usage or positive enactment has defined all the perils insured against, and there is no need of inserting them in a policy; but the judge giving the opinion said: “He had not been able to find any authority that in Great Britain and this country claims that any perils are insured against other "than those enumerated in the policy, and any necessarily or usually consequential ones.” If this be so, still it may be that when risks are not enumerated, but there is a general contract of insurance, the law has resources enough-to determine as a question of fact or ■of law what it is that the contract insures against. It Is, however, the universal custom to enumerate the risks. In this case, if we have to rely on the words “port risk,” as a statement of the perils, we can not see in them the character of any peril, in the concrete. They describe nothing by which a ship may be damaged. There are sea risks, fire risks, danger from pirates, &c., in port, as there are on the high seas (Duval v. Commercial Ins. Co., 10 Johns. 278 ;. Patrick v. Com. Ins. Co., 11 Id. 9): As “port risk” does not designate any of these in particular," if we reject wholly the printéd enumeration of perils, the policy would be without any specification of perils insured against. To uphold all the parts of the contract, as far as can be, it is only necessary to read the whole of the policy, as limited by the written part “ port risk in port of Hew York.” Whenever the words, “this present voyage,” “take upon itself in this voyage,” &c., &c., occur, the word “voyage’* should be deemed a “falsa demonstration not annulling entirely that part of the contract where it is, but,, in fact, intended to designate the time and the circumstances embraced in the written part. Whatever is peculiar to a voyage, or particularly to be applied to a voyage, is to be disregarded. Ho voyage is described. Therefore it must also be said that the policy does not contemplate taking a risk upon any part of a voyage to be made by the ship unless it is included in the written part. This I believe to be a correct application of the cases in this state on this point (Grousset v. Sea Insurance Company, 24 Wend. 206 ; Leeds v. Mechanics’ Insurance Co., 8 N. Y. 356 ; Frichette v. State Mutual Fire, &c., Ins. Co., 3 Bosworth, 190). The loss to the ship came from a peril insured against, so far as it was in its character a sea risk, i.e., in the tide sweeping it against the rock. We can not, however, decide that the dismissal of the complaint should be sustained on the ground, that the peril referred to was not extraordinary. This, if averred as a defense in the answer, was not alluded to upon the dismissal of the complaint. I am of opinion that the principle which apply to general insurance in voyage policies, viz., that the implied warranties call for the insured preserving himself against the ordinary action of the winds and sea, applies to such a policy as this, keeping, however, in view its subject-matter ; and that a loss from the ordinary action of the tide is not to be borne by the defendant. But the plaintiff should have been apprised of the particular defense, as he might have given evidence that the tide or the risk was extraordinary.

We have said that “port risk” is not the designation of the intrinsic character of any peril likely to cause damage. To be sure, it is not impossible that a port might have a risk so peculiar to itself that such a risk would be so described among insurers and merchants. There could be no objection to giving oral proof of what this risk was, and to show that the words were used to designate it. There is no claim, however, by the defense that “port risk” was used in this way. The word port.as here used refers to the extrinsic relations of the risk as existing while the ship is in port, not simply, however, as within the territorial lines of the port, but as using the port for the purposes of a port, up to the time when the voyage should begin, and to the time when the port is used to begin the voyage therein. The apparent object of the clause-is to state, by the use of a “ generalissimum nomen” viz., risk, what the insurers will bear the consequences' of, and to exclude what risks they will not bear. The-distinction, as the learned counsel for the respondent urged, includes “port risk” as different from “voyage risk,” which is excluded. Such distinctions are-usual in marine insurances. In time-policies there is-often a provision that if at the end of the time the vessel is at sea, the insurance shall continue, &c. It is held in such cases, that if before the time expires, the vessel rs ready for sea, quits her mooring, and endeavors to get out to sea, but is kept back by stress of weather, and comes to anchor, and after that suffers from a sea-peril, she, within the contract, is at sea, although, in fact, she is in a port or in a canal leading to the sea. Her being in the port is but an incident unavoidable on her part to her sea voyage (Bowen v. Hope Ins. Co., and The Same v. Merchants’ Ins. Co., 20 Pick. 275, as cited in note 3 to p. 55, 2 Parsons Mar. Ins. ; Union Ins. Co. v. Tyson, 3 Hill, 119; American Ins. Co. v. Hutton, 24 W. 330, aff’d 1 Hill, 321).

In this particular case the words “port risk” are connected with the words “in port of Hew York,” and the main question is, when did the risk taken, end. The cases frequently determine when a risk ends, by considering when another begins, although the latter is not expressed in the policy, or vice versa. It is upon the natural supposition that risks are classified and ■ words appropriate to the classes are used. When words used for one class appear in a policy, the risks indicated • thereby are exclusive of the risks indicated by other words which have been generally employed.

A ship was insured “at and from,” and warranted to sail, by a certain day. She did not sail until a later time. The question was, whether the premium paid could be recovered back, on the ground that no risk had ever attached under the policy. The court held, that there was a class of risks, indicated by the word “at” when the vessel was in port, distinct from the risk attached to the voyage, indicated by the word “from,” and that although the breach of warranty prevented the attaching of the latter, there was an insurance while the vessel was in port, before the voyage (Hendricks v. Commercial Ins. Co., 8 John. 1.)

The words “at and from Hew Orleans, Campeach, and Havana,” although they may imply that the vessel may go from one to the other, as commencing a course of trade, do not imply that the vessel shall go “to” any of the ports as prescribing the end of the voyage (Grousset v. Sea Ins. Co., 24 W. 207).

The words describing a voyage as “to” a port, continues the voyage beyond the territorial line of the port until the vessel is moored in the port; yet the word “to” implies literally no more than up to the port, and no further,and on the other hand, a “voyage from” a port includes that part of the voyage which, at its beginning, is in the port.

In the same way the words in the present policy are intended to exclude risks which would be taken upon a voyage “from ” the port of Hew York. I therefore am of opinion, that as matter of law the court might hold that the commencement of a voyage terminated the risk under the policy.

On the other hand, I think the defendant was at liberty, if the court chose to allow it, to examine experienced underwriters or merchants to show how the-word was used in the business of insurance, or rather what it meant, solely, however, upon the ground, that it is evidently a word formed for business and technical purposes. It is a composite word, which gets its form in a manner unusual in the formation of words in general. If it could be done, there was no objection to show that “voyage risk” and “port risk” were used distinctively. I think the court was bound to see that such was the use of the words “ port risk ” in the policy, and therefore in a sense it was unnecessary to examine witnesses; yet I think the testimony would be an assistance to the court in coming to a conclusion. I do not, however, think that the meaning of the words could have been left to the jury, inasmuch as the policy taken together fixed the meaning of the clause.

In so far as the witnesses, in endeavoring to define the term, gave a statement of the legal effect of the contract, or an opinion as to the time when the risk ended, the testimony was incompetent. The value of the testimony was exhausted when it had given the use and meaning of the words.

I am of opinion that the judgment should be affirmed with costs.

Curtis, J., concurred.


text:
    MICHAEL B. FIELDING, Plaintiff and Appellant, v. EUCLID WATERHOUSE, Defendant and Respondent.
    CO-SURETIES.
    Their relations ; and the liability op one to contribute TO PAYMENTS MADE BY ANOTHER.
    In this state, sureties, upon performance by them of their contract in regard to their principal, are entitled to the original evidences of debt held by the creditor, and to any judgment in which the debt has been merged, as well as to all collateral securities held by the creditor.
    The right of the surety is not only that of subrogation, pure and simple, but a right to an assignment by the creditor.
    Performance of the conditions of the suretyship discharges the principal obligation, so far as the existence of any interest of the original creditor in the same ; but the original debt is kept alive as between the creditor and debtor and the surety, for the purpose of enforcing the rights and interest of the surety therein, as against the debtor, his principal.

      A co-surety has the same responsibility for preserving and keeping alive securities, liens, and liabilities against the original debtor, in favor of his co-surety from whom he claims contribution, as a creditor has in behalf of sureties from whom he claims payment or fulfillment of the original obligation.
    If a creditor releases or satisfies any security which holds against the principal debtor he must answer for the value of what he releases or satisfies.
    The burden of proof, as to the value of the release or satisfaction, rests upon the party releasing or discharging.
    In the case at bar, a judgment was satisfied and discharged against the original debtor by the consent and action of one of the sureties, who now seeks contribution from his co-surety for the amount paid by him, and the former should answer to the latter for its discharge and satisfaction, and the burden of proof as to its value rests upon the surety who discharged and satisfied the same.
    By analogy it is right to apply the general rule of damages to this case, namely : that when the amount of value is made incapable of estimation by the act of the wrong-doer, he must be held responsible for the value that by any reasonable possibility the same may prove to be, as in this case, the full amount of the judgment that was satisfied.
    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal by plaintiff from order granting a new trial alter verdict for plaintiff.
    The action was by the plaintiff against the defendant, as co-surety for contribution. It appeared upon the trial that an action had been brought in this state by one Murray against one Harris and other defendants. In that action an attachment had been issued against the property of the defendants. Property was taken under the attachment, and to relieve it therefrom the present plaintiff and defendants became co-sureties in an undertaking made in pursuanee of the Code, in the sum of seven thousand, three hundred dollars, “that we will, on demand, pay to the above named plaintiff the amount of the judgment which may be recovered against the above named-defendants in this action,” &c. The plaintiff, Murray,., in that action recovered judgment in the sum of five thousand eight hundred and thirty-five dollars. This judgment not being paid by the debtors therein, it was assigned with the undertaking to one Simms. Simmsbegan an action upon the undertaking against the-present plaintiff and defendant jointly. The present defendant was not served in that action. ‘While the action on the undertaking was pending, the present plaintiff, Fielding, through a third person, requested one Beardon to come on to this city, in reference to the claim made. Thereupon said Beardon, plaintiff Fielding, and the attorneys of Simms had negotiations which resulted in an agreement to compromise for a less sum the judgment in the original attachment suit. In pursuance of this, the present plaintiff, Fielding, paid two thousand five hundred dollars; Beardon paid two thousand two hundred dollars; Fielding-received a general release; the action on the undertaking was discontinued; and the judgment in the attachment suit was satisfied of record. The present defendant was ignorant of these matters. So much, appeared by the undisputed evidence. The defendant gave evidence to show that at the time of payment by plaintiff there was a special agreement, which, in its effect, released the defendant from an obligation to-contribute; but the court charged the jury, that if they found the defendant’s version tobe correct, they should find for the defendant. The jury found in favor of the plaintiff in one thousand two hundred and fifty dollars.
    Before the case went to the jury, the defendant’s counsel asked that the jury be directed to find for the-defendant, on the ground that by the arrangement made, “judgment against the original defendants was satisfied, and so the right of subrogation of the sureties was lost.” This was refused, and the defendant excepted. After verdict, defendant made a motion for a new trial, which was granted. This appeal is taken by the plaintiff, from this order.

      Snead, Grimball & Rives, attorneys, and E. Edward Rives, of counsel, for appellant.

      Man & Parsons, attorneys, and John E. Parsons, of counsel, for respondent.
   By the Court.—Sedgwick, J.

The plaintiff and defendant were co-sureties for the payment of a judgment against their principal. By a negotiation between the judgment creditor, the plaintiff, and one Beardon, a compromise was agreed to, of which the plaintiff paid about one-half, and Beardon the other half, and thereupon, as was further agreed between them, the judgment was satisfied of record. The merits of this appeal are to be determined by ascertaining if this satisfaction of the judgment relieved the defendant from an obligation to contribute to the sum paid by the plaintiff. No other question was made upon the argument of this appeal.

Although Copis v. Middleton (1 T. & R. 229), and the opinion of Judge Story (Story's Eq. %% 499b to § 500, and notes), are to the effect that the surety has no right of subrogation to -the debt or the evidences of the debt which he has contracted to pay, and therefore pays upon fulfilling his contract, the law in this state has settled for many, years, that the surety, upon performance by him of his contract, is entitled to the original evidences of debt held by the creditor, and to any judgment in which the debt has been merged, as well as to all collateral securities held by the creditor: The right of the surety is not only that of subrogation, pure, and simple, but a right to an assignment by the creditor (Marsh v. Pike, 1 Sandf. Ch. 210 ; Cheeseborough v. Millard, 1 Johns Ch. 409 ; Clason v. Morris, 10 Id. 524; Goodyear v. Watson, 14 B. 481 ; Eno v. Crooke, 10 N. Y. 66; Ellsworth v. Lockwood, 20 N. Y. 98, and other cases). By performing the contract of suretyship, the principal obligation is discharged against the creditor, and is kept alive between the creditor, the debtor, and the surety, for the purpose of enforcing the rights of the last.

A co-surety has, of course, the same responsibility for keeping alive sureties in favor of bis co-surety from -whom he claims contribution, as a creditor has, in behalf of sureties (Notes to Derin v. Earl of Winchelsea, 1 Leading Cases in Eq., 3 Am. ed. 156, et seq). If a creditor releases or satisfies any security which he holds he answers for the value at least of what he discharges or satisfies (2 Am. Leading Cases, 394): If the release is of a nominal title, from a judgment, the surety is not discharged or the claim against him at all abated (Blydenburgh v. Bingham, 38 N. Y. 375). If goods are released from a levy,' the claim of the party releasing, against the surety, is lessened by the amount of the value of the goods. The burden of proving what is the value of the thing released or the security discharged, is upon the party releasing or discharging (Neff's Appeal, 9 W. & S. 36, cited in 2 Am. Leading Cases, 405 ; Hubbell v. Carpenter, 5 N. Y. 171).

In the present case no chattel or real estate has been released from the judgment, but the judgment itself is discharged. The burden of proving the value of this judgment is upon the plaintiff, who should answer to the defendant for its being discharged. So far as I can see, it is not possible to estimate correctly what is or will be the value of a judgment through the time it can be kept alive. It is not without value ; it may prove to be of the value of its nominal amount. By analogy it. is right to apply the general rule of damages, that when the amount is made incapable of estimation by the act of the wrong-doer, he must be held responsible for the value it may by reasonable possibility turn out to be of (Armory v. Delamirie, and notes, 1 Smith's Leading Cases, 584; Hart v. Ten Eyck, 2 Johns. Ch. 62.) Is there any mitigation of these damages in the fact that the defendant, if he paid a contribution, would have his action against the principal ? It would seem, impossible to make such a use of this contingent course of action. It would be for the amount the defendant would pay the plaintiff after the plaintiff has proven what the amount should be by showing the value of the judgment. The defendant would not have the benefit of the judgment in question, with its peculiar character, or an equivalent advantage, down to the time he secured judgment in his own behalf.

The plaintiff did not satisfy the judgment, but the creditor did. The plaintiff is responsible for this, which took place in this state ; for he did not demand from the creditor that the j udgment should not be satisfied, but took part in an arrangement which had as an object the extinguishment of the judgment. The judgment was not satisfied by force alone of the payment made by Beardon. If it had been, the plaintiff would have, been under no obligation to pay any part of it, and could not ask a contribution.

• It is urged, however, that the judgment is kept alive in equity although it is extinguished at law. The case of Burrows v. McWhaun (1 Dess. 409), is particularly referred to, and it is spoken of approvingly as an illustration in Cuyler v. Ensworth (6 Paige, 32). There was no attempt in that case to declare that the general consequence of satisfying a judgment at law could be avoided in equity by any decree short of setting aside the satisfaction. The complainants sought against administrators to establish a right to a priority of payment out of the estate. This right they would have if they could maintain a right under a judgment obtained against the intestate. They showed that being sureties for the payment of the judgment, they had paid a large part of it. The intestate-having died, the administrators of his estate paid the remainder of the judgment, and obtained satisfaction. The complainants claimed that this act of the administrators should not bar their rights to priority as specialty creditors. The court gave the complainants rank as if they were1 specialty creditors. In effect the court determined what the rights of the complainants as sureties were at the time they paid the judgment in part, and considered that they had a right to be subrogated to the creditor’s remedy through the judgment, and the court did nothing more as to the present point than decide that as against the inequitable or wrongful act of the defendant which produced a satisfaction of the judgment, it would deem the judgment alive. The full effect of this case does not relieve this plaintiff, for two-reasons. 1. The defendant here is entitled to the legal effect of the judgment flowing from its character as a judgment, and not depending for any benefit that might be procured through it on a special judgment in equity reviving it or deeming it revived. 2. The plaintiff’s act has led to the satisfaction, or permitted it; the damage to the plaintiff flows from that. There is no reason why plaintiff should be allowed to say that in his favor, to neutralize the consequence of his own acf, the defendant should find his relief by a special-action in which the satisfaction will be disregarded. The plaintiff should bear himself any burden he has created. It is not necessary to deny that if the defend•ant was called upon to contribute in this action, he might, in a proper case, subject property of the principal debtor to his claim as if the judgment had not been satisfied. As we have intimated, such a benefit would only be in redress of an injury caused by plaintiff.

There is another reason why equity would not revive the j n dgment for any purpose. Equity observes the intentions of the parties. The presumption is that a surety, in acting in regard to securities to which he is entitled for his indemnity, intends to give that form to the transaction which is most beneficial to himself. If, however, the result of the evidence is to show that it was intended that the security should be finally discharged for all purposes, the surety, and no one claiming through him, can use the security as if it were not extinguished (1 Leading Cases in Eq., 3 Am. ed. 155 ; Harbeck v. Vanderbilt, 20 N. Y. 395). Beyond •doubt in the present case it was the intention of the parties that the'judgment should be discharged for all purposes, legal and equitable, and the payment by Beardon of a part of the compromise as a consideration for the satisfaction, prevents as matter of law that the judgment should be revived.

It is, however, claimed that as the plaintiff paid but apart of the judgment, he was not entitled to an assignment. This view separates the action of the parties, and does not consider them as acting jointly and with a common purpose. In that view, however, we must suppose that Beardon’s payment went to reduce the .amount of the judgment. ~ The rest would.be between the plaintiff as surety and tlm judgment debtor as his principal, the proper security to the plaintiff for his payment as part of the compromise. Unless the agreement between the judgment debtor and the plaintiff was that the judgment should be entirely extinguished, the creditor could not have lawfully refused to assign the judgment as reduced for the plaintiff’s indemnity.

I am of opinion that the order appealed from should be affirmed with costs.

Curtis, J., concurred.


text:
    DAVID IRWIN and TIMOTHY M. BRISTOLL, Executors, &c., Plaintiffs and Appellants, v. MATTHEW S. CHAMBERS, Defendant and Respondent.
    PROCEEDINGS SUPPLEMENTARY TO EXECUTION.
    Examination on Judgment Debtor.
    A judgment debtor can not be subject to several successive examinations unless the creditor can show specially that facts arising after one examination call for further examination.
    The same rule applies to an examination upon a judgment recovered upon a former judgment, upon which these proceedings had been taken, and the defendant examined, &c.
    In order to justify an examination under such a judgment, the judgment creditor must show specially that facts have arisen since the former examination that call for and justify another examination.
    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal from an order of the special term.

      Stephen B. Brague, for appellant.

      Wm. G. Wheelwright, for respondent.
   By the Court.—Sedgwick, J.

The plaintiffs, under the usual affidavit, took out the usual order supplementary to execution, under § 393. On the return of this, an affidavit of the defendant was read, that on February 33, 1873, one Jackson recovered a judgment against defendant for three hundred and fifty-three dollars, in the common pleas. Jackson having died, these plaintiffs were appointed his executors. About June 39, 1875, an order supplementary to execution was taken under the judgment in the common pleas. The defendant was examined as to his property, and on that, the plaintiffs applied to the judge of common pleas for the appointment of a receiver “to take and receive the salary about to become due to this deponent for his services as clerk in the Bowery Savings Bankbut that application was denied. On September 8, 1875, this action was brought upon the j udgment in the common pleas, and on September 30, 1875, the judgment was recovered in four hundred and seventy dollars. Deponent had ‘ a wife and two children dependent upon him for their support, and this deponent has no property, and is entirely dependent upon the salary received by him from the Bowery Savings Bank of this city for his maintenance and that of his family.”

Ordinarily the opinion of the judge is not looked to to find the actual state of the case before him. The case must be looked to. This appeal must be an exception, in consequence of the disjointed way in which the case is presented. The learned judge, in his opinion, says : “Even if the Bowery Savings Bank has not yet paid the salary due to the judgment debtor, for personal services rendered during the month of October last, the same is necessary for the use of the family supported wholly by the labor of such judgment debtor.” This evidently referred to the provisions of section 397.

The order entered was upon the whole case as presented in the above entitled action. It is ordered, “that the proceedings for the examination of the judgment . debtor, Matthew S. Chambers be dismissed without costs.”

The notice of appeal refers on its face to this order, as an order made “vacating the order supplementary to execution.”

An appeal must be heard upon the points made below, to which the attention of parties, and the court was called and given. I infer, from the case, that the only point the judge was called to pass on was whether the salary due to the defendant by the Bowery Savings Bank should be directed to be applied by the defendant. It was the same as if it were agreed that the facts stated in the affidavit would appear upon the examination. Ho error was made by the judge in this matter. By section 297 the fact that earnings are necessary for the use of a family supported wholly or partly by the debtor’s labor may be “made to appear” by the debtor’s affidavit.

For that reason the order should be affirmed; but the learned counsel for the appellant claimed that he had a right, even if the judge properly declined to make an order that the salary be paid over, to proceed to an examination to disclose facts upon which a receiver- of the defendant’s property might be appointed.

The language of section 292 is clear and imperative that when an execution is returned, the creditor is “entitled to an order from a judge requiring the debtor to appear and answer,” &c., &c. The substance of this right the creditor should freely enjoy. But the” letter of the statute should not be forced into an application to circumstances not intended by the section. In the nature of the case, from necessity, the broad language should be limited by general priucipies of law and equity made applicable to general provisions for procedure. When a party has had one order, the right is exhausted up to that time, lío property appearing, it should not be presumed that such an insolvent has after that acquired property, so as to permit another order and still another to be made. If another order be applied for, either in the application for the order or in response to a motion to dismiss it, it should appear that there are circumstances which call for an examination into the existence of after-acquired property. At all stages the proceeding should appear to be for the purpose of the statute, i. e., to obtain property, and not for the purpose of having the examination only. The section is a summary proceeding in lieu of, or in addition to, the right to a creditor’s action. Equitable principles must be applied in both cases.

The thing in this case which seems to make what has been said inapplicable to it, is that there never was a former order taken out in this action. It is true; but there was one taken out in the judgment which forms the cause of action here. There was an examination then, and an application to the judge for a receiver on or after July 8, 1875. And on September 8, 1875, this action was brought, and the amount of indebtedness increased by costs and compound interest. I do not say that any proceeding sanctioned by law is oppressive, but I must say, that the new action did not annul the full privilege the plaintiffs once had of •obtaining the appointment of a receiver. If the order refusing one was erroneous, it would have been reversed on appeal in the general term of the common pleas. All the rights the plaintiffs could claim under the section have been given to them. As against the debtor, the plaintiff’s resort to his new action should not deprive the debtor of exemption from unnecessary and harassing examination. There is no hardship in this or appearance of injustice. All the-creditor need do is to show specially that subsequent facts call for further examination.

The order appealed from should be affirmed with ten dollars costs, and disbursements to be taxed.

Curtis, J., concurred.


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    ALBERT JOURNEAY, Plaintiff and Respondent, v. JACOB B. TALLMAN, Defendant and Appellant.
    BROKER’S COMMISSION ON SALE OF REAL ESTATE.
    In the case at bar the single ground for reversal of the judgment was that the plaintiff’s case was not supported by a preponderance of proof, and the verdict was against the evidence.

    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal from judgment entered upon verdict, and from order denying motion for new trial.

      James M. Smith, for appellant.

      Butler, Stillman, and Hubbard, attorneys for respondent.

      William Allen Butler, of counsel.

      Note by Reporters.—Although the review by the court is upon the facts alone we deem the case worthy of a full report.

   By the Court.—Sedgwick, J.

The single ground upon which a reversal of the judgment is asked, is that the motion for a new trial should have been granted, inasmuch as the plaintiff’s case was not supported by a preponderance of proof, and the verdict in his favor was against the preponderance of the proof.

I can not come to such a conclusion, but am of opinion that there was evidence which supports the verdict, and that such evidence was not a little in quantity or insignificant in its relation to the merits of the issue. The action was for broker’s commissions. The defendant testified that he gave the houses to the plaintiff, and told him that he would pay him his commissions if he sold them. He gave the plaintiff distinct authority to offer the house at a certain price. The plaintiff engaged in an effort to sell, and went so far as to bring the defendant and the gentleman who after-wards purchased by an exchange, to a difference of two thousand dollars in cash only; the defendant wanted two thousand dollars more than the purchaser was willing to give.

There were several brokers who had such authority that if they had caused the sale that was made they would have been entitled to commissions. The question was—and it was fairly and with discrimination left to the jury—whether the plaintiff was the broker whose efforts had led to the sale. I do not think there would have been much trouble about deciding which of the brokers was entitled to a commission if the principals-had not considered the expense of brokerage in the transaction. The property of the defendant was to be' exchanged for other property owned by the purchaser. In this other property its owner had a broker, who was to be entitled to commissions from his employer if he succeeded in getting it exchanged for the defendant’s: property.

The evidence justified a construction which the jury could make. The difference between the parties was two thousand dollars.^ If the purchaser thought he was to pay no commissions, by the consent of his broker, and the defendant thought he would have to pay no commissions, because the broker he employed did not accomplish the negotiation entrusted to him, out of this difference would be removed one thousand seven hundred dollars.

The point to be proved, after employment was shown, was that the efforts of the plaintiff had resulted in the sale upon substantially the terms upon which he was to bring about the sale. The plaintiff, and witness produced by him, was present at the closing up of the agreement. On this point he made a prima facie case by testifying that the defendant said to him that the matter was carried through on the basis, that the defendant had given the plaintiff. This was enough to sustain the plaintiff’s recovery, unless the defendant overthrew it by a preponderance of evidence that the jury might rely on. But as to such evidence it was the duty of the jury first to see that the witnesses who gave it had such a recollection of the facts that it should be relied upon, and next to give a correct construction of what was remembered.

There were three witnesses for the defense, the defendant himself, the purchaser, and the broker, who was in one phase of the matter the purchaser’s broker. Hone of these, however, could state the terms upon which the bargain had been closed. The defendant did not state what they were. The purchaser testified that he did not remember what the basis was upon which he finally treated with the defendant. He did not remember what he got for his property. He did not remember what he paid for his property. The broker testified that he could not recollect what the terms of the transaction were; all he knew was that the price of the defendant’s property was eighty-five thousand dollars. The most definite evidence on this point is of the following kind. The purchaser testified that he refused to close the sale upon the terms that the plaintiff brought him, and he never closed them upon those terms. The defendant testified “that there was no difference at the closing between the terms that I gave to the plaintiff and those I gave to the purchaser’s broker, It was closed upon terms that the plaintiff' said he could not accomplish. 1 don’t Itnow how it came to he closed upon those terms. If my recollection serves me right, the difference between the terms that it was closed upon and what he had tried to close it at was two thousand dollars. I stood out for two thousand dollars. I told them I could not make it any other way. I did not vary. I suppose the purchaser’s terms and mine were the same when we closed. I told the plaintiff that I would close upon those terms.”

This evidence did not furnish any facts on which the jury were bound to say that they destroyed the force of the prima facie case of the plaintiff, especially when the means of explanation by defendant were so ample.

There was evidence interspersed, here and there which the jury must have noticed, in view of the doubt there evidently was in the minds of the defendant’s witnesses as to the exact character of the closing up. The plaintiff testified that after his last interview with the defendant, before the bargain was settled, having-received terms from the defendant, he went to the house of the purchaser. The purchaser said he had sent a man, meaning the person who was his own broker, into the defendant’s houses. The plaintiff remarked, “This won’t do. This is wrong.’’ The purchaser then said, “You sit down. You will get your commission—you are entitled to your commission—you stay here,” and some time after, told the plaintiff that the person who had acted as his broker “ has carried it through upon the basis I proposed.” After that, soon it was that the defendant made the admission referred to, that he had not made any different arrangement from what was proposed through the plaintiff.

It appeared from the testimony of the purchaser that his broker, in carrying the terms to the defendant, “ added the price of his brokerage to the value of the property,” i. e., the property he was to give in exchange for the defendant’s property, ‘ ‘ not that I paid it, but what he would have received, so that I could get from the defendant enough to make me whole after I paid my broker.” “ I was doing the best 1 could for myself. The commission was added to the value of my property.” And the purchaser had before testified, ‘I think my broker said he would charge no commission, none to me,” and afterwards, “I had no understanding with him that he was to get his commission out of the defendant.” The j ury may, or at least was at liberty to, infer that the purchaser had been relieved from his broker’s commissions.

On the other hand, there was testimony from which the jury was at liberty to infer that in the final closing up, the defendant had in that closing up considered that he might disregard the expense of any commissions, and could therefore abate eight hundred and fifty dollars from his terms. He testified that he never paid the gentleman (who had acted as the purchaser’s broker, and who upon the trial, it was claimed for the defendant, had induced the transaction in question) as his broker, and, in fact, had not paid any brokerage. Although he did not know how it came to be closed upon the terms which, in fact, made the bargain, he was able to testify “that in the final closing up something was said about commissions.”

The purchaser’s broker was in much doubt, as a witness, as to his status: “I have the impression that there was a trade of the house in Thirty-eighth street, i. e., one of the pieces of property that the purchaser gave in exchange for the defendant’s property. I presume that the purchaser has paid me, as his broker, for this portion of that transaction. The defendant has not paid me.” “I don’t know that I have not a claim’’ against the defendant. “I don’t know about that; I have not made up my mind.”

The jury must have considered what, in fact, from the circumstances in evidence, was “ the something that was said about commission, to the defendant in the final closing up. They may have inferred that because the plaintiff was not present at that closing up, the parties bargaining thought he would not be entitled to commission, and that such a consideration was urged by the purchaser’s broker, to show that the defendant might deduct that expense. As the plaintiff was not there to agree to that, his claim remained in abeyance, until he insisted upon it in this action. If the purchaser could give eight hundred and fifty dollars more because he paid no broker, and the defendant could deduct eight hundred and fifty dollars because he paid no broker, all of the difference in the two thousand dollars was disposed of excepting three hundred dollars. Under such a state of facts it can naturally be seen that after the plaintiff claimed his eight hundred and fifty dollars it was difficult for the parties to say whether the bargain was closed upon the terms carried by the plaintiff. I think the jury was at liberty to say that the plaintiff’s efforts had accomplished what was the actual result.

These details have been given because the defendant has no further appeal on such a matter, and because the learned counsel for the appellant made a very zealous and ingenious argument. But I can not help thinking that the jury had enough evidence before them to support the views which have been here indicated-I only add that there were pieces of testimony given by the witnesses for the defense at variance with what has: been here cited. In none of these cases, however, was-the evidence not noticed such a modification of what has been noticed that the latter should not be considered by itself. On the other hand, the plaintiff wag at liberty to ask the verdict of the jury between the two.

The judgment and order appealed from are affirmed, with costs.

Curtis, J., concurred.


text:
    ROBERT COCHRAN, Plaintiff and Appellant, v. CHRISTIAN GOTTWALD, and DANIEL A. MURPHY, Defendants and Respondents.
    In an action to recover the possession of personal property, where the-answer alleges that as to a portion of the property the defendants renounce all claim or interest thereto, and offers plaintiff a judgment as to that portion, with costs, &c., and upon an issue as to the rest, which was tried before a referee, the referee erred in finding that the defendants were entitled to the return of all the property mentioned in the complaint without excejjtion, or its value, fixed at five hundred and fifty-four dollars. The referee should not have included the value of the property in regard to which, by the answer, the defendant had renounced all right and interest.
    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.

      Appeal from judgment entered on report of referee.
    The complaint was that “ the defendants have become possessed of, and wrongfully detain from, the plaintiff the following goods and chattels of the plaintiff, that is to say,” with a statement of the property ; and the demand was for a delivery of the chattels, and damages for the detention.
    The answer was a denial that the plaintiff had any property in the chattels specified in the complaint, excepting certain chattels specified in the answer, and as to that excepted property, viz : “ skeleton road wagon, sleigh, two fur robes, and one black mare, defendants renounced all claim or interest to and in them, and hereby offer plaintiff judgment as to them, with the costs and expenses of re-possessing himself of them.”
    The answer further averred that defendant Gottwald recovered judgment against one Schiefferdecker, and execution was thereon issued and delivered to defendant Murphy, who was a marshal of the city, &c., and thereupon said Murphy levied said execution upon the property mentioned in the complaint, and that such property, with the exception stated, was the property of the judgment debtor.
    The plaintiff, by the usual proceedings, had procured the delivery of the property, and the defendant demanded the return and re-delivery, with the exception as aforesaid, and damages.
    On the trial before the referee, it appeared that the plaintiff claimed as mortgagee of Schiefferdecker. The mortgage was made on condition that the mortgagor pay the plaintiff a specified sum “ on demand.” It did not appear that before the levy there had been any demand of payment. The property when levied upon was in the possession of the mortgagor.
    The referee found, that the defendant was entitled to the return of the property mentioned in the complaint, not making any exception ; and if the re-delivery could not be had, then judgment in the sum of five hundred and fifty-four dollars. In fixing the value of the property taken by the marshal, the referee included the value of one road wagon, one sleigh, and one black mare, being chattels which the answer renounced a right to.

      A. J. Perry, for appellant.

      Spencer L. Hillier, for respondents.
   By the Court.—Sedgwick, J.

There must be a new trial, because it appears that the referee has given the defendant, as part of his damages, the value of •articles which the answer admitted the plaintiff should have judgment for, and also has directed that the defendant should have judgment for the return of these .articles. If it were not for the matter of damages, the error would not, perhaps, call for anything but a correction of the judgment. It is necessary, however, to have a correct assessment of the damages upon the new trial.

It may be as well, however, to say'a word upon the merits. So far as the testimony now stands, there never had been any default on the part of the mortgagor. The indebtedness had not ever become due, and no demand for payment had been made. The mortgagor was rightfully in possession, and therefore had an interest which could be levied upon under the execution. If nothing further appears upon the new trial, the defendant will be entitled to a judgment for the return of the articles which he claims under his answer, or for their value.

As to that part of the claim which is admitted by the answer, the attention of the appellant’s counsel is called to the last clause of §344 of the Code. I do not think § 385 is to be applied. It is not, however, meant to state here what is the proper course to be taken by the plaintiff.

The counsel for the defendant claims that there is no cause of action stated in the complaint, because no demand is averred. This assumes that the complaint states an action only for wrongful detention after a lawful possession. I am inclined to think that the position is correct. The complaint says defendants “became possessed of,” not “wrongfully possessed of,” and it does not charge that the defendants “ took.” If it was necessary to give a construction to the complaint, I think it would be that the defendants came into possession lawfully. This, however, can not be considered here, as cause of affirmance, because the trial took place without this point being raised, and it might have been cured by amendment upon the trial. The complaint sufficiently avers that the goods and chattels were the property of the plaintiff. Before a new trial, the plaintiff should determine whether he goes upon an unlawful taking or an unlawful detention, or both, and have the complaint so amended that his exact claim shall appear thereon.

For the reason 'first stated, the judgment should be reversed with costs to the appellant to abide the event, the order of reference discharged, and a new trial had.

Curtis, J., concurred.


text:
    CHARLES OFFINGER, et. al., Plaintiffs and Respondents, v. DAVID R. DE WOLF, Impleaded, &c., Defendant and Appellant.
    PRACTICE.
    Inteblocutoby judgment.

      Remedy of party aggrieved.

    The Code has made no provision for an appeal from an interlocutory judgment. An appeal must be based upon a final judgment, and is governed by § 368 of the Code; or in a case where there was a trial and decision and an interlocutory judgment, the remedy of a party aggrieved is by a motion for a new trial under the same section (368), and such a motion must be based upon a case made, &c.
    A party aggrieved by an interlocutory judgment, after a trial, can not be relieved on a motion to the court to vacate or modify such a judgment. He must move the court at general term for a new trial, &c.
    Before Curtis and Sedgwick, JJ.

      Decided February 7, 1876.
    Appeal by defendant from a part of an interlocutory judgment and from an order denying defendant’s motion to set aside or modify such interlocutory judgment.

      Nelson & Cooke, attorneys for appellants ; Erastus Cooke, of counsel.

      Kissam & Embury, attorneys for respondents ; Benjamin T. Kissam, of counsel.
   By the Court.—Sedgwick, J.

So far as this appeal seeks to review the interlocutory judgment—for it is a judgment (§ 267), and notan order (§ 400)—it is controlled by § 268. The only relief in such case is a motion for a new trial, and that must be made upon a case or exceptions, settled and filed. There is a necessity that in reviewing an adjudication the appellate ■court should have before it, in an authenticated form, the matters upon which the court below acted. At any rate, such is the law. The Code has made no provision for an appeal, as such, from an interlocutory judgment. It must be from the final judgment.

And so far as the appeal is concerned, which is from the order denying the motion of defendant “to vacate and set aside the order or decree entered in this action,” “and that the cause may be restored to the calendar for trial,” that motion was not made upon any alleged irregularity or surprise (Rule 41). It, in fact, related to the merits of the action, and was an attempted appeal from the judgment, except, perhaps, so far as it involved a position of defendant, that in fact there was no trial of the issues. On this question ■of fact there were affidavits for the defendant which at the most showed there was no trial; but opposed to them were affidavits for the plaintiff which showed there was a trial. There were the findings and conclusions of the judge, which recited that the issues were brought on for trial before him, and there were the exceptions taken by the defendant himself, in the form appropriate to a decision made upon a trial. On the facts, it was clear that the judge who tried the case and who heard the motion was right in decreeing that there was a ■ trial, and that the only remedy of the defendant to correct any error was by appeal from final judgment on a motion for a new trial, under §268.

There was a motion made by the respondent’s counsel, before the argument on these appeals began, that the appeal from the judgment should be dismissed. This motion should be affirmed, with costs of ten dollars.

The order appealed from should be affirmed, with ten dollars costs, and disbursements to be taxed.

Curtis, J., concurred.


author: By the Court.—Van Vorst, J.

text:
    WILLIAM MACPHERSON, Plaintiff and Respondent, v. WILHELMINA RONNER, Defendant and Appellant.
    PRACTICE IN AN ACTION BEFORE A REFEREE. '
    A motion to set aside the report of a referee should be made before judgment is finally entered, for, if successful, it would prevent the entry of a judgment. It would be useless work to vacate and set aside the report and yet allow the judgment to stand.
    In the case at bar, the referee allowed the plaintiff to amend his ' complaint on motion, giving the defendant twenty days to serve an amended answer, to which defendant objected and excepted, and refused to amend his answer, but afterwards went on with the defense on the trial, and after report and judgment thereon, he moved to set aside the report on the ground that the amendment so allowed by the referee was improper.

      Held, that this motion was too late.
    The defendant could have contested this question by a special motion to the court, at the time, for an order setting aside the amendment. In this way the matter could have been simply and expeditiously disposed of before the trial was concluded, if a motion in such a case was proper, It is too late to raise the question after the trial, report, and entry of judgment, except on appeal from the judgment.
    The report having become incorporated with the judgment, can not be detached and considered apart from it. The report and judgment must stand or fall together.

      Before Sedgwick and Van Vorst, JJ.

      Decided February 7, 1876.
    Appeal from order of special term.
    The complaint in this action alleges that the plaintiff performed certain work, labor, and services for and furnished certain materials to the defendant in the erection and construction of a certain dwelling-house for defendant in the city of New York. The answer, among other things, alleges that the plaintiff made an agreement with the defendant to erect and finish a dwelling house for the defendant for a certain price; that the building was never finished, to the defendant’s damage.
    The issues were referred to a referee for trial. During the trial before the referee, the plaintiff asked to amend his complaint by adding after the words “New York” in the complaint the following, “and for work and labor done and materials furnished for and at the request of defendant, in repairing other houses of the defendant, and in building fences upon the defendant’s premises.” The defendant objected to the amendment on the ground “ that it was new matter, that he was taken by surprise, and that the amendment was contrary to the statute.” The objection was overruled and the defendant excepted.
    The plaintiff was allowed to amend, the defendant to be served with a bill of particulars, and allowed twenty days within which to serve an answer. The bill of particulars was served, but was returned by defendant, who declined to serve an amended answer.
    After the amendment, however, the trial proceeded before the referee, and evidence was given by the defendant, to meet the plaintiff’s proof, in respect to the matters covered by the amendment,

      The referee reported in favor of the plaintiff, and upon August 3, 1875, ajudgment was entered in favor of the plaintiff, upon the referee’s report, and for the amount thereby awarded plaintiff.
    In September following, and after the judgment, a motion was made to set aside the report of the referee, on the ground that the amendment of the complaint was improper.
    Mo motion has been made to set aside either the order allowing the amendment or the judgment.
    The motion to set aside the referee’s report was denied, and from the order of denial this appeal is taken to the general term.

      Mr. Burwell, for appellant.

      Mr. Hall, for respondent.
   By the Court.—Van Vorst, J.

If the order made by the referee during the trial allowing the complaint to be amended was for any sufficient reason objectionable, and the defendant intended to contest it by a special motion, instead of proceeding with the trial, and giving evidence with respect to the subject-matter of the amendment, he should have at once applied to the court at special term for an order setting aside the amendment. There was abundant opportunity for this within the twenty days allowed the defendant to serve the amended answer, before further proceedings could be had before the referee.

In this way the matter could have been simply and expeditiously disposed of if a motion was at all proper.

I should say that it was too late to raise by motion an, objection to the amendment after proceedings on the trial have been had under it, and the referee has reported, and judgment upon the report has been actually entered.

By this final step the report has become incorporate with the judgment, and can not be detached and considered apart from it. The report and judgment must stand or fall together. To be effective, a motion simply to set aside the report of a referee should be made before judgment is finally entered ; if successful, it would prevent a judgment. It would be idle to set aside the report and allow the judgment to stand.

The defendant made his objection on the trial, at the time the amendment was asked for, and he excepted to the ruling of the referee on the subject.

He has taken an appeal from the judgment. If any error was made by the referee in allowing the amendment, the case on appeal will disclose it.

The court a‘t general term, when the appeal is heard, will determine whether the amendment was within the power of the referee to order, or if discretionary, whether the discretion was abused. We are of opinion that the defendant having sought a review of the proceedings on the trial by appeal, and which seems tobe the appropriate remedy, should be left to redress in that proceeding, if any be proper.

It is not necessary at this time, with an appeal pending, to express any opinion as to whether or not the amendment should or could have been allowed by the referee.

The order appealed from should be affirmed with costs.

Sedgwick, J., concurred.