text:
    THOMAS MACKELLAR, Respondent, v. GEORGE W. ROGERS, Impleaded, &c., Appellant.

      Jury trial of cause of action at law in counter-claim to an equitable action triable by the court—right of—requisites to obtain. '

    Where a counter-claim, founded on a cause of action at law, is interposed . to a complaint in an action for equitable relief, triable by the court without a jury, if a jury trial of the issues arising on such counter-claim is desired by either party, he must, within ten days after issue joined on the counter-claim,, give notice under Rule 81, of a special motion to be made on the pleadings; that the whole issue, or any specific questions of fact involved therein, be tried by a jury. If he omits to do this, ho waives a jury trial, and cannot, on the trial at special term before the court, claim a jury trial of the issues on the counter-claim, as matter of right.
    In such case; it is discretionary with the court to grant a postponement of the trial for the sole purpose of enabling said party to make such special motion.
    Sections 970 and 974 Code, construed.

      Before Van Vorst and Freedman, JJ.

      Decided December 7, 1885.
    Appeal from a judgment of the special term decreeing foreclosure and sale of mortgaged premises.
    The facts and exceptions appear in the opinion.

      Martin J. Keogh, attorney, and of counsel for appellant, argued:
    I. The counter-claim sets forth a cause of action at law, for damages for a breach of contract, and demands judgment for a sum of money only. It contains matter for which a separate cause of action might be maintained by defendant against plaintiff and upon which defendant is entitled to a jury trial as matter of right {Code, §§ 968, 974; Cook v. Jenkins, 79 N. Y. 575; Kain v. Delano, 11 Abb. N. S. 29 ; Hewlett v. Wood, 62 N. Y. 75 ; Clarke v. Brooks, 26 How. 285 ; McDonnellv. Stevens, 9 Hun, 28 ; Ross v. Combes, 37 Super. Ct. 289 ; Litchfield v. Dezendorf, 11 Hun, 358 ; Brady v. Cochran, 23 Ib. 274). For the purposes of this argument, the court must look at defendant’s counter-claim, as if it was in the form of a complaint in an action brought upon it by defendant against plaintiff (Code, § 974; Cook v. Jenkins, 79 N. Y. 575). Here defendant has interposed a counter-claim, and has demanded an affirmative judgment thereupon. An issue of fact arises upon this counter-claim made by plaintiff’s reply. Defendant is therefore clearly within Code, § 974. “ In each of the following actions an issue of fact must be tried by a jury, unless a jury trial is waived, or a reference is directed : (1.) An action in which the complaint demands judgment for a sum of money only” (Code, § 968). Here the judgment demanded is for a sum of money only. Even if an account were involved, it would not deprive defendant of his constitutional right to a jury trial (Bell v. Mayor, 11 Hun, 511; Camp v. Ingersoll, 86 N. Y. 433 ; Van Rensselaer v. Jewett, 6 Hill, 373 ; Thomas v. Reab, 6 Wend. 503; Magown v. Sinclair, 5 Daly, 63 ; Keep v. Keep, 58 How. 139 ; Townsend v. Hendricks, 40
      How. Pr. 143). The only recovery defendant can have is for damages (Jerome v. Scudder, 2 Bob. 169; Smith v. Kelly, 56 Me. 64 ; Love v. Cobb, 63 N. C. 324; Youell v. Allen, 18 Mich. 108 ; Vigers v. Pike, 8 Clk. & Fin. 582 ; Nelson v. Bridges, 2 Beav. 239 ; Story on Equity, § 769 ; Sternberger v. McGovern, 56 N. Y. 12 ; McDonnell v. Stevens, 9 Hun, 28; Wiswall v. McGown, 2 Barb. 270 ; Shepard v. Sanford, 3 Barb. Ch. 127 ; Newham v. May, 13 Price, 749 ; Blore v. Sutton, 3 Meriv. 247; Clifford v. Brooks, 13 Vesey, 130 ; Story on Equity, §§ 794, 749 ; Bradley v. Aldrich, 40 N. Y. 504; Ross v. Combes, 37 Super. Ct. 289).
    II. The cause of action in this case in favor of defendant, is clearly distinguishable from Cook v. Jenkins, (79 N. Y. 575), and Whiton v. Spring (74 Ib. 169). Those were equity actions. This is clearly a common law action, and defendant’s right to have it tried by a jury is absolute (Kain v. Delano, 1 Abb. N. S. 29 ; Hewlett v. Wood, 62 N. Y. 75; Constitution of N. Y., art. 1, § 2).
    III. Since it is clear that defendant is entitled to a jury trial upon the cause of action arising upon his counterclaim, the remaining inquiry is, as to whether he has waived his right. We submit that the defendant has not waived it, and that his legal rights have been preserved {Code, § 1009 ; Wheelock v. Lee, 74 N. Y. 495 ; Davidson v. Asso. of Jersey Co., 71 N. Y. 333; aff’g 6 Hun, 470; Hennequin v. Butterfield, 43 Super. Ct. 411; Hudson v. Caryl, 44 N. Y. 553 ; Litchfield v. Dezendorf, 11 Hun, 358). These authorities clearly dispose of the question of waiver. In Hand v. Kennedy (83 N. Y. 149), and Derham v. Lee (87 N. Y. 599), defendants lost their right to a jury trial solely because they failed to demand it, in the latter case, and failed to secure a ruling upon this demand for a jury in' the former.
    IV. The court erred in holding that the practice required the defendant Jo move at special term to frame issues, to be tried by a jury. It is only in a case where a party is not entitled to a jury trial as matter of right, that an order may be made framing issues for a jury (Code, § 823 ; Snell v. Loucks, 12 Barb. 385 ; Const, art. I. § 2). (1) The fact that the jurisdiction of courts of law and courts of equity are blended, and that the Code has abolished the distinction between remedies at law and in equity, does not deprive a party of a right to trial by jury, in a case where, prior to the adoption of the Code, he had such right, and any statute or provision of the Code, which would direct a court to frame issues in a common law action, would be unconstitutional {Const, art. I. § 2). (2) The language of the constitution on this point is clear and explicit, so as to preserve the ancient right to a jury in all cases in which it existed prior to the adoption of the constitution. The language is as follows: “§ 2. The trial by jury in all cases in which it has been heretofore used, shall remain inviolate forever.” (3) This constitution was adopted in 1846. The only inquiry, then, is whether a party in an action to recover damages for breach of contract, which is a simple action at law, was entitled to a jury trial in such an action prior to 1846. There can be no question on this point. No one will contend that an action for damages for breach of contract was within the jurisdiction or cognizance of a court of chancery prior to 1846. (4) Before the constitution of 1846, issues could be framed only in chancery suits, in a proceeding which, under the old practice, was denominated a “ feigned issue ” (3 Blackstone’s Com. 452 ; Baylies’ Trial Prac. 272 ; Snell v. Loucks, 12 Barb. 385 ; Laws 1838, p. 244 ; Griffith v. Griffith, 9 Paige, 315 ; Laws 1839, p. 292 ; Chancery Rule, 96; Lord Teynham v. Tyler, 6 Bing. 561; Barker v. Ray, 2 Russ. 63 ; Carroll v. Deimel, 95 N. Y. 252). (5) The term “ feigned issue” is thus defined by elementary writers : 66 An issue brought by consent of the parties or by the direction of a court of equity, or of such courts as possess equitable powers, to determine before a jury some disputed matter of fact which the court had not the power or is unwilling to decide ” {Bouvier’s Law Dict.). (6) The Code (§ 823) has abolished “feigned issues” and substituted instead the practice of framing issues. The result is that in equity suits, instead of resorting to the old practice of a feigned issue, the court makes an order to frame issues to be tried by a jury. (7) This practice, however, has nothing to do with common law actions. The court cannot frame issues in such actions under section 970 or 971, any more than a court of law could resort to a “feigned issue ” in an action for trover or conversion. And if any of these sections did compel the framing issues in common law actions, they would be unconstitutional in that respect. But the language used in the sections carefully provides against such a result. (8) In 823, the language as to framing issues is, that such issues may be framed “in any case, where neither party can, as of right, require a trial by jury.” (9) It follows then, that if either party can, as of right, demand a jury trial, issues cannot be framed. Now, what would be “ the mode of trial on this counter-claim,” if it arose in an action brought by defendant against plaintiff ?” (Code, § 974). (10) So the language of section 971 is equally guarded : “In an action where a party is not entitled, as of right, to a trial by jury.” (11) The language of section 970 is “where a party is entitled by the constitution or by express provision of law, to a trial by a jury, of one or more issues of fact, in an action not specified in section 968 of this act.” (12) It follows, that if defendant’s counter-claim “ arose in an action brought by defendant against the plaintiff ” it would fall within such actions as are specified in section 968 ; because the defendant asks no equitable relief, but “demands judgment for a sum of money only.” It is clear, therefore, that section 970 has no application to this case, and that defendant is entitled to a trial by jury as a matter of right. (13) In Carroll v. Deimel (95 N. Y. 252), the action was to foreclose a mortgage. The defense wras simply payment. The court held that the action was an equity action, and that findings of a jury, if afterwards disregarded by the chancellor, may be reviewed on appeal, but' in that case there was no counter-claim upon which defendant would have been entitled to bring a separate action against plaintiff. (14) Here, such a counter-claim is pleaded, and the question before the court is, “ If the counter-claim had arisen in an action brought by defendant against the plaintiff, for the cause of action stated in the counter-claim,” would he, in such an action, be entitled, as of right, to a trial by jury. Because ‘£ the mode of trial ” cannot be changed, for the reason that the cause of action happens to be embraced in the counter-claim, instead of in the original complaint {Code, § 974). (15) The court, therefore, must consider the question just as if no equity suit for the foreclosure of the mortgage were pending. Such suit has no bearing on the particular inquiry presented on this appeal.

      George M. MacKellar, attorney, and of counsel for respondent, argued:
    I. The defendant has no constitutional right of trial by jury of the questions raised by his counter-claim {Constitution 1846, art. 1, § 2 ; Chapman v. Robertson, 6 Paige, 627 ; Jennings v. Webster, 8 Ib. 503). Under the Code of Procedure, actions to foreclose mortgages wore tried by the court at special term, without a jury (Code Proc. §§ 253, 254 ; Goold v. Bennett, 59 N. Y. 124). The fact that an answer was interposed, demanding an affirmative judgment, did not alter the character of the action or the mode of trial (Welsh v. Darragh, 52 N. Y. 590; Townsend v. Hendricks, 40 How. Pr. 143; Verplanck v. Kendall, 45 Super. Ct. 525 ; Matter of Empire City Bank, 18 N. Y. 199). Under the Code of Civil Procedure such actions are to be tried by the court without a jury (section 969), unless the defendant proceeds to obtain a jury trial under the provisions of sections 974 and 970.
    II. The only right the defendant has to a jury trial of the counter-claim set up in the answer, is by virtue of the provisions of section 974 of the Code of Civil Procedure. Section 974 is not mandatory upon the defendant. Kor under that section can the court or the plaintiff compel a defendant to submit to a jury trial. It is optional with the defendant whether he will have such a trial or not. But if he wishes to avail himself of the provisions of section 974, and desires his counter-claim to be tried by a jury, he must proceed to obtain a jury trial in the manner directed by and in accordance with the provisions of section 970. Section 968 specifies the actions which must be tried by a jury unless a jury trial is waived, or a reference is directed. This is not one of the actions specified in section 968. That section covers cases where the complaint demands judgment for a sum of money only, and actions for ejectment, &c., specified in subdivision 2. The complaint in this action does not demand judgment for a sum of money only.
    III. Whatever right the defendant had to a jury trial he waived by failing to comply with the requirements of section 970 of the Code, and general rule 31. The defendant’s failure to move for the framing of issues within ten days after issue joined, and his giving a notice of trial for the special term, constituted a waiver of' his right to a jury trial under section 974. By failing to claim it at the proper time or in the proper manner, or by any conduct which would be sufficient to constitute a waiver of rights in other cases, the party is deemed to have wraived his right to trial by jury, whether that right be constitutional or legal (Baird v. Mayor, 74 N. Y. 382 ; Barlow v. Scott, 24 Ib. 40 ; Greasen v. Keteltas, 18 Ib. 491; West Point Co. v. Reymert, 45 Ib. 703 ; McKeon v. See, 51 Ib. 300).
    IV. The postponement or adjournment of the trial being discretionary with the trial judge, the exception to the refusal to postpone was not well taken.
   By the Court.—Freedman, J.

The only question presented by the exceptions is whether the trial of the action should or should not have been postponed until after a trial by jury was had, of the issue arising upon defendant’s counter-claim.

The action was brought for the foreclosure of a mortgage for $15,000, and interest. By his answer the defendant admitted all the facts set forth in the complaint, and then set up a counter-claim against the plaintiff for about $51,000, for a breach of contract, upon which he demanded an affirmative judgment. The plaintiff replied to the counter-claim. Both parties noticed the case for trial at special term, but when it was called for trial in its order upon the calendar, the defendant, before any evidence was given, demanded a trial by jury of the cause of action embraced in his counter-claim as his constitutional and legal right. The motion was denied upon the ground that the proper mode of apptying for a jury trial under such circumstances was by special motion to have issues framed and sent to a jury. To this ruling and denial of his motion, the defendant duly excepted.

The defendant then asked leave to make application at special term for the framing of issues. This motion was also denied, and the defendant duly excepted. The defendant thereupon withdrew from the case.

There can be no doubt that the claim of the defendant, as stated by the counter-claim, is one upon which, in a separate action directly brought upon it, he would be entitled to a jury trial as matter of right. But from this it by no means follows that he can rightfully claim the same mode of trial in the present action.

The constitutional right to a jury trial extends only to cases in which it existed prior to the adoption of the constitution. In the case at bar there is no such right, because the action is an equitable one which at all times was, and now is, triable by the court alone, formerly by the court of chancery, now by the court at special term, and because in the court of chancery of this state the right of set-off in such an action existed solely by virtue of the provisions of the ¡Revised Statutes (Chapman v. Robertson, 6 Paige, 627 ; Jennings v. Webster, 8 Ib. 504), which conferred no right of trial by jury, although the court had discretionary power to frame a feigned issue and order that to be tried by a jury.

Since that time the practice in this respect has been considerably changed. The jurisdiction of courts of law and of courts of equity has been blended ; feigned issues have been abolished, and the practice of framing issues has been substituted, and the right to interpose counterclaims has been enlarged. It consequently remains to be seen whether there is any statutory ground for the contention of the defendant.

Section 974 of the Code of Civil Procedure provides that where the defendant interposes a counter-claim, and thereupon demands an affirmative judgment against the plaintiff, the mode of trial of an issue of fact, arising thereupon, is the same as if it arose in an action, brought by the defendant against the plaintiff, for the cause of action stated in the counter-claim, and demanding the same judgment.

This section, therefore, upon an issue arising-upon a counter-claim like the one in suit, confers a right of trial by j ary, because the defendant would be entitled to such a trial, if he were to bring an independent action upon the same claim.

But the right is a purely statutory one. The section is not mandatory upon the defendant. It gives him an option whether he will have such a trial or not. If he wishes to obtain the benefit of the statute in an action triable by the court alone, he must proceed to exercise his option and take certain steps. His remedy is under section 970, which provides that, where a party is entitled, by the constitution or by express provision of law, to a trial by a jury of one or more issues of fact, in an action not specified in section 968, he may apply upon notice to the court for an order, directing all the questions, arising upon those issues, to be distinctly and plainly stated for trial accordingly, and that thereupon the court must cause such issues to be distinctly and plainly stated. Section 968 does not help a defendant, in such a case to escape from the necessity of making his motion or application, because, besides the actions of ejectment, for dower, for waste, for a nuisance, and to recover a chattel, it covers only cases in which the complaint demands judgment for a sum of money.

The fact is that the different provisions of the Code of Civil Procedure, bearing upon the point under consideration, can be harmonized in no other way than by holding that the only remedy of a defendant in such a case is under section 970. This alone would be sufficient to call for the construction of section 974 hereinbefore contended for. But there are additional considerations of great weight. The character of an action, and the mode of trial of the issues of fact tendered by the complaint therein, are in every case determined by the complaint. The intent of section 974 is to enable a defendant to have his counter-claim considered in the disposition of plaintiff’s case, whether such case be of a legal or equitable nature. In other words, the defendant may, in all cases, have his counter-claim determined in connection with the claim made by the plaintiff as one of the issues in the case. But this involves that the defendant must proceed in such a way that the court can do it without unnecessarily delaying the plaintiff’s case upon the main issue. If the cause of action brought by a plaintiff into court is one which must be determined by the court without a jury, the counter-claim of the defendant, though it may be triable by jury at the option of the defendant, must be presented at the trial of the main issue in such a shape that due effect can be given to it at the close of plaintiff’s evidence. For these reasons it would be unjust to construe section 974 to mean that the defendant in such a case, after the joinder of issue upon the counter-claim, may sit still for months, until the case is reached for trial in its order upon the special term calendar, then try plaintiff’s side of the case, which is the main issue, and after all that, when defeated upon that, claim a jury trial upon his separate issue, and thus prevent a final judgment for many more months, if not years. But this is what the defendant’s contention upon the present appeal amounts to, especially in view of the fact that his answer contains an express admission of all the material allegations of plaintiff’s complaint.

From what has already been said, it sufficiently appears that defendant’s remedy to obtain a jury trial upon his counter-claim, was by special motion under section 970. Such motion, under Bule 81 of the General Buies of Practice, should have been made within ten days after joinder of issue. By failing to thus move for the framing of issues, and by giving notice of trial for the special term, the defendant waived his light to a jury trial under section 974. After it had been waived, and when the case was actually called for trial in its order upon the calendar, it was discretionary with the court to grant a postponement of the trial for the sole purpose of enabling the defendant to do what he might have done long before. The case discloses no reason why the exercise of that discretion should be disturbed. The defendant, by refusing to litigate his counter-claim and withdrawing from the case, preserved his right to enforce it in a separate and independent action.

The judgment appealed from should be affirmed, with costs.

Van* Vorst, J., concurred.


source: Caselaw Access Project

author: By the Court.—Freedman, J.

license: Public Domain

text:
    GEORGE W. WOOD, Respondent, v. RUDOLPH F. RABE, et al., Impleaded with EMMA E. DURAND, et al., Appellants.

      Tender to stop interest—Pa/yment into court—Equitable principles as to—• Waiver by taking issue.

    Courts of equity apply the rule as to payment into court according to the equities of each case.
    In the case at bar, plaintiff was entitled, upon payment to one Maria Mulock of certain sums, to a re-conveyance of certain real estate, the legal title to which was, on the 23rd of February, 1860, and at the time of the commencement of the action, in said Maria Muloch, and of which she was in possession. On October 23, 1860, plaintiff tendered said sums, with interest to that date, to said Maria Mulock, and demanded a deed, which she refused to give. The complaint in the action, among other things, alleged a certain tender and refusal to give the deed, and contained an offer to pay the sums tendered, and prayed for a re-conveyance. The answer denied the tender alleged. Pending the action, Mrs. Mulock died, and it was revived against the defendants, the executors of her will, and her children. The court below rendered judgment decreeing the execution and delivery of a deed to the plaintiff, and that at the time of such delivery, plaintiff pay to her executors the said certain sums, with interest thereon to October 23, 1860.

      Held, a proper judgment; that under the circumstances of the case, the actual payment into court was not necessaiy to” work a stoppage of interest on October 23, 1860.

      Also held, that by taking issue on the tender, payment into court was waived.
    Before Sedgwick, Oh. J., and Freedman, J.

      Decided December 7, 1885.
    ' Appeal from judgment entered upon the decision of a judge at special term.
    The facts appear in the opinion.

      Rudolph F. Rabe, attorney, and Algernon S. Sullivan, of counsel for appellants, argued:
    I. To make a tender effectual for any purpose, it is the duty of the party pleading it to deposit the money into court and allege that fact, and if this is not done, the authorities hold that the tender is a nullity. This is so both at law and in equity (Becker v. Boon, 61 N. Y. 317 ; Harris v. Jex, 55 Ib. 421; Brown v. Ferguson, 2 Denio, 196 ; Bklyn Bk. v. De Grauw, 23 Wend. 342 ; Hills v. Place, 48 N. Y. 520, 523 ; French v. Simpson, 25 How. Pr. 464 ; Roosevelt v. Bull’s Head Bk., 45 Barb. 579 ; Tuthill v. Morris, 81 N. Y. 94; Shotwell’s Exrs. v. Denman, 1 Coxe, 202 ; Arrowsmith v. Van Harlingen’s Exrs., 1 Ib. 26 ; Stockton v. Dundee, &c., 7 C. E. Greene, 56 ; Shields v. Lozear, 7 C. E. Greene [N. J.] 447 ; Gyles v. Hall, 2 P. Wms. 378 ; De Wolf v. Long, 2 Gilm. [Ill.] 679 ; Doyle v. Teas, 4 Scammon [Ill.] 267 ; Jarboe v. McAtee, 7 B. Mon. [Ky.] 279 ; Aulger v. Clay, 109 Ill. 487 ; 31 Alb. L. J. 414; Mathison v. Wilson, 86 Ill. 51 ; Carr v. Miner, 92 Id. 604; Ventres v. Cobb, 105 Id. 33 ; Pulsifer v. Shepard, 36 Ill. 513 ; Webster v. Baxter, 35 Id. 211; Park v. Wiley, 67 Ala. 310; Hamlett v. Tallman, 30 Ark. 505 ; Bissell v. Heyward, 6 Otto, 580 [U. S. S. C.]; Brock v. Jones, 16 Tex. 461; Mohn v. Stoner, 11 Iowa, 30 ; Barker v. Brink, 5 Ib. 481; Clark v. Mullenix, 11 Ind. 532; Jarboes v. McAfee’s Heirs, supra; Dixon v. Clark, 5 Com. Bench R. 365 ; Claflin v. Hawes, 8 Mass. 261; Carley v. Vance, 17 Id. 392).
    II. Plaintiff may urge that the defendants have waived their rights to object to the defect in the plea and non-pa)rment into court, by having taken issue upon the plaintiff’s complaint, and cite in support of such claim, the case of Sheridan v. Smith (2 Hill, 538) ; but that case has been explained and distinguished in Becker v. Boon (61 N. Y. 317), where the same claim was made. It was there held by Earl, J., at p. 322, “that the answer contained another defense besides tender, and hence plaintiff was bound to receive it. He could not return it, or treat it as a nullity.” So in the case at bar, the complaint contained other allegations besides that of tender, and defendants have a right to avail themselves thereof at any time. They could not return a complaint and treat it as a nullity ; they were bound to answer, and did so. Their principal defense was in the beginning aimed at the law and equities of the case, to determine which it took two trials, two appeals to the general term, and one to the, court of appeals.
    III. The case of Wheelock v. Tanner (39 N. Y. 481), is-not an authority against our contention. The finding in. that, case was that the tender was bad because accompanied by the condition that a mortgage should be discharged. The question was whether imposing the-condition of the. mortgage before the property should be-delivered, vitiated the tender. There was no question but. that the defendants were entitled to have the mortgage-discharged before they could be required to deliver the, wagons. The condition was one upon which the defendants had a right to rely, and that condition did not vitiate the tender. The condition was a condition precedent to-the defendants’ liability to pay, and a tender of payment, on such condition was therefore a tender' of full performance of the defendant’s obligation. In the case at. bar, there was no such condition precedent. The agreement was that Mrs. Muloch should re-convey the interest, in said lands to her son whenever he should repay to her-the sums of money expended and laid out. This imposed: upon him a duty or obligation ; in fact, it was a condition, precedent on his part, to be performed before he could-, demand a reconveyance. The amount of money which, had to be refunded, in that way, in reality belonged to. Mrs. Muloch. Is is a familiar doctrine in courts of equity that “he who seeks equity must do equity,” and without, that the court of equity will not extend its arm for the-relief of the suitor. Though it was plaintiff’s duty to, repay the several sums of money to Mrs. Muloch, he-simply offered it to her, and during all this litigation has had the use of it. He comes into court, and asks for the redemption of certain property held in trust for him, to obtain which property the trustee expended a certain amount of money ; she refused to convey to him ; she has had no benefit by reason of her refusal; but the plaintiff has, because he has had the use of this money. It is well enough for him to stand on his equitable rights, and endeavor to obtain equitable relief, but that does not discharge him from the obligation to refund that which he has received, and not to traffic with the money, but to deposit it where the defendants may get it when they please. Law and equity both point out a way to be followed to save oneself from further interest and costs. This plaintiff had neglected to do, and he should therefore be chargeable with the consequences.

      Deyo, Duer & Bauerdorf, attorneys, and B. E. Deyo, of counsel for respondent, argued:
    I. The defendants have waived payment into court. The complaint alleged a tender. The answer denied that, such a tender was ever made (Sheriden v. Smith, 2 Hill, 538 ; Platner v. Lehman, 26 Hun, 374).
    II. Tender has 0been waived. This waives payment into court, because such payment is only made to keep a tender good. • The answer denied t,he existence of the alleged contract, and alleged that she owned the fee. The question of tender thus becomes eliminated, because Mrs. Mulock assumed the responsibility of saying, “ even if you did make the tender, I was not bound to convey.” This position would make a tender an idle ceremony (Crary v. Smith, 2 N. Y. 60).
    III. Mrs. Mulock claiming to own the property absolutely, ahd the premises being ample security, the amount to be received by her from the plaintiff would not have been ordered to be paid into court, even if a motion had been made to that effect (Jenkins v. Hinman, 5 Paige, 309 ; Wyckoff v. Anthony, 9 Daly, 417).
    IV. Wood’s tender and demand and Mrs. Mulock’s refusal to perform stopped the running of interest against Wood. He was not bound to pay except upon receipt of a deed. Mrs. Mulock refused to give it. She broke her contract. The authorities fully support the respondent’s position (Wheelock v. Tanner, 39 N. Y. 481; Davis v.
      Duffie, 8 Bosw. 691; Wilder v. Seelye, 8 Barb. 408 ; Hansard v. Robinson, 7 B. & C. 90 ; Smith v. Rockwell, 2 Hill, 482 ; Rowley v. Ball, 3 Cow. 303; Chitty on Bills, 260 ; Strong on Bills, §§ 448, 449 ; McDaneld v. Kimbrell, 3 Green [Iowa], 335 ; Williams v. Willhite, 3 Head [Tenn.] 344; Heywood v. Hartshorn, 55 N. H. 476 ; Washburn v. Dewey, 17 Vt. 92).
    V. Wood did not make a tender in the strict legal sense, and it was improper for him to have done so. There is no exc§ption to the rule that a legal tender must be unconditional (Wood v. Hitchcock, 20 Wend. 47; Breunich v. Weselman, 40 Super. Ct. 32). The only tender Wood did or could make was an offer to pay, conditioned on the delivery of the deed. He "was not endeavoring to get rid of an obligation, but to enforce the performance of a contract.
    VI. If Wood had paid into court the sum tendered, and had been beaten, he would have lost his property and his money also. Money once paid into court is irrevocably lost to the payer, although on the trial it is shown it was not owing (Bacon’s Abr. Tender, N. 3 ; Read v. Mutual Co., 4 Sandf. 54).
    VII. Wood made the offer so as to furnish evidence, on the trial, of his readiness to perform his part of the contract at the time when he demanded performance by his mother. In commencing his suit, he had his choice to recover damages at law, or to have a specific performance in equity (Crary v. Smith, 2 N. Y. 60). Had he sued in damages, it was not necessary to have tendered the money. He need only to have shown, at the trial, that at the time of demanding the deed, he was ready,— i. e., able,—to pay (Wheeler v. Garcia, 40 N. Y. 584 ; Currie v. White, 45 Ib. 822). He gave the highest proof of readiness by producing the money.
    VIII. An examination of the cases cited by the appellants will show that where payment into court was held to be necessary, it "was also held that the tender was or should have been unconditional, or was relied on to work an inequitable forfeiture of a lien. No doubt, great stress will be laid upon the cases of Tuthill v. Morris (81 N. Y. 94), and Shields v. Lozear (22 N. J. Equity [C. E. Green], 447); but they are clearly distinguishable.
   By the Court.—Freedman, J.

The case has been re-tried in conformity with the decision of the court of appeals, reported in 96 N. Y. 414, and judgment given in favor of the plaintiff.

By this judgment it has .been determined that Mrs. Mulock, in whom .was vested the legal title to an undivided interest in certain real estate, held that title as trustee for the .plaintiff, to whom she was bound to convey it on demand, and upon payment by the plaintiff of the sums advanced by her for the discharge of liens thereon, and of the amount of a judgment confessed by him to her.

Among other things it was found that, in point of fact, the plaintiff, in December, 18-59, demanded a conveyance from Mrs. Mulock, which was refused, and that on October 23, 1860, he duly tendered to Mrs, Mulock the sum of $4,322.67, which covered all the claims of Mrs. Mulock, together with interest thereon up to said 23d of October 1860, and again demanded a conveyance of her which was again refused.

Upon these facts it was held, as matter of law, that by reason of the said tender, demand and refusal on October 23, 1860, the defendants are not, nor are any of them, entitled to interest on the said claims of Mrs. Mulock, beyond the date of said tender, and that at the time of the execution and delivery of the conveyance which was decreed to be made, the defendants Babe and Goodridge, as executors, &c., are entitled to receive from the plaintiff only the sum of $3,225.50, with interest on $2,005 from November 27, 1855, to October 23, I860, on $807.50 from December 22, 1855, to October 23, 1860, and on $413 from February 16, 1856, to October 23, 1860.

By their points, the appellants have expressly limited the discussion to the question of their right to any interest since October 23, 1860.

Their contention is that the tender was insufficient to stop the running of interest from said date, because it was not followed up by a deposit of the money into court.

The common law rule of tender and bringing money into court, is stated in Bacon's Abridgment, title “Tender,” as follows, viz : “ It is in the general true, that if a debt or duty be not discharged by a tender and refusal, the tender must be pleaded with a proferí in curia; for as the debt or duty continues, it is not enough for the party who pleads the transfer, to plead a tender and refusal with uncore prist1, or with uncore prist together with -tout temps prist, as the case may require ; but he must also bring the money, or other thing which has been tendered, into court, that the other party may, if he please, accept thereof.”

• The rule originated in cases in which the defendant could not, and did not, deny the debt or duty on his part, but in which he nevertheless sought to defeat the action by a plea cf tender before suit brought. It was held that, to be effectual for that purpose, the plea of tender had to be accompanied by a payment of the money into court, and a notice expressing the fact. The money then belonged to the plaintiff, and had to be paid to him, though he failed in the action, as he was bound to fail, if the tender was properly made, and of the correct amount. But unless the money was paid into court, the plaintiff was at liberty to treat the plea of tender as a nullity, and to sign judgment as for want of a plea.

That in all such cases, the tender must be kept good by the payment of the money into court, is also the law of this state (Simpson v. French, 25 How. Pr. 464; Brooklyn Bank v. De Grauw, 23 Wend. 341 ; Brown v. Ferguson, 2 Den. 196 ; Hills v. Place, 48 N. Y. 520 ; Becker v. Boon, 61 Ib. 317).

The statutes passed from time to time, and the existing provisions of the Code of Civil Procedure, authorizing a tender and payment of the money into court by the defendant after suit brought, in order to affect the question of costs, and to stop the running of interest, are mere extensions of the rule.

Courts of equity, in matters not controlled by express statutory provisions, apply the rule according to the equities of each case, and irrespective of the question whether the party against whom it is to be enforced, is a plaintiff or a defendant in the case.

Thus, in Roosevelt v. Bull’s Head Bank (45 Barb. 579), which was an action to foreclose a mortgage, the question was whether the plaintiff was entitled to recover the principal and all the interest, or interest only to the time oí the tender. As it appeared that the notes- tendered and refused, were immediately afterwards mixed by the hank with its other funds and used in its banking business, and yielded a profit, the plaintiff was held entitled to a judgment for the principal debt and all the interest.

On the other hand, it was held in Jenkins v. Hinman (5 Paige, 309), that upon a bill to redeem, where the complainant is in possession of the premises, which are an ample security for the amount admitted by him to be due, and the defendant insists that he is the absolute owner of the premises and that the complainant is not entitled to redeem, the court will not order the amount admitted to be due to be paid into court, nor appoint a receiver of the rents and profits of the premises pending the litigation, if' the insolvency of the complainant is fully denied.

Many other cases might be referred to for the purpose of showing how exclusively the action of courts of equity is determined by the equities of each particular case in all matters not regulated by statute. But the two illustrations which were given, are sufficient for the present!

There are, no doubt, many cases, both at law and in equity, depending upon a tender, in which the money must be brought into court and the tender kept good. Every such case, however, implies an unconditional indebtedness by the party making the tender.

But in a case in which the acts of both parties should have concurred in the performance of the contract, and taken place simultaneously, it is enough for the plaintiff to show that he was ready, able and willing, and offered to perform his part, and that the defendant refused the other part. Having put the defendant in default, the plaintiff in such a case, if it be a case for specific performance, can go into equity with clean hands and demand-specific performance without being obliged to keep the amount in court. And for similar reasons it has been held, in Stevenson v. Maxwell (2 N. Y. 408), that where, under a contract for the sale of lands, the purchase money is to be paid or secured, and the conveyance executed on a particular day, .and neither party performs or offers to perform on the day, neither can maintain an action at law upon the contract, but that either may claim specific performance in equity, making in the bill the offer incumbent upon him. A tender may even become wholly unnecessary in consequence of a previous notice by the other party of refusal to perform (Crary v. Smith, 2 N. Y. 60).

At all events, a tender of performance may be accompanied with such conditions as were, by the terms of the contract between the parties, conditions precedent to be performed by the party to whom the tender is made. This doctrine was expressly laid down in Wheelock v. Tanner (39 N. Y. 481). The action was to foreclose a mortgage payable in money, with interest. The bond was capable of being paid in lumber wagons, at a stipulated price, to be delivered at such places as the mortgagee should designate. The wagons were ready for delivery at the time and place stipulated, and were not actually delivered because the mortgagee was not then ready to receive them, but requested that they should be kept until he was ready. Upon these facts, it was held that a further tender of the wagons was unnecessary, and that from and after the time when the wagons were ready to be delivered according to the terms of the contract, no further interest could be charged on the debt to be thus paid. And it also appearing that it was a condition of the bond and mortgage in suit, that the mortgagee was to pay off another mortgage held by one Tuttle, and that, if he did not, the defendants might suspend the payment of their bond and mortgage until the Tuttle mortgage was paid, it was further held that the tender of the wagons which was made by the defendants, was not bad because accom-panied by the condition that the Tuttle mortgage should be discharged.

The case at bar is an equitable action. The plaintiff was not bound to pay except upon receipt of a conveyance. Mrs. Mulock refused to make and give it. She therefore committed a breach of the contract. Moreover, she was in the possession of plaintiffs’ property by virtue of and under a deed to her which was absolute upon its face, and she thereafter continued in possession and enjoyed the fruits of ownership as if she were the absolute owner. Under these circumstances, it would be highly inequitable to award- to the defendants, as her representatives, interest on the amount tendered by the plaintiff, and refused by her, without making them account for the benefits derived by Mrs. Mulock from such ownership. Presumably, such benefits would exceed the interest withheld.

Tuthill v. Morris (81 N. Y. 94), does not help the defendants. It was an action to restrain the defendant from selling certain premises in statutory proceedings to foreclose two mortgages thereon, and to have the same adjudged to be extinguished, and to require the defendant to cancel them of record, on the ground that the amount of the mortgages had been tendered and refused. It was, therefore, the case of a mortgagor in possession, and receiving the income of the property, and at the same time enjoying the use of the money for the payment of which, the bond and mortgage had been given. The sufficiency of the tender made was doubted, and it was held that, even if a sufficient tender had been made, which, according to strictly legal principles, discharged the hen and constituted a good defense against its enforcement, equity would nevertheless withhold the affirmative relief sought by the plaintiff, viz.: the extinguishment of the mortgage upon the record. In this connection, it was said that the most that could be equitably claimed, would be to relieve the plaintiff from the payment of interest1 and costs subsequently accruing, and to entitle him to this relief, he should have kept his tender good from the time it was made.

Other cases cited by the learned counsel for the defendants may, for similar reasons, be distinguished from the case at bar. They have not been overlooked, but they are not mentioned, because a detailed examination of them is deemed unnecessary.

Upon the whole case, it sufficiently appears that the disallowance of interest after October 23, 1860, was right and proper. An additional reason why the disallowance should be sustained, is that, even if Mrs.' Mulock could have insisted upon payment into court of the money tendered, she waived her right by taking issue upon the tender. The complaint alleged full tender. In her answer, she denied that such a tender was ever made. This constituted a waiver under the authorities (Platner v. Lehman, 26 Hun, 314 ; Sheriden v. Smith, 2 Hill, 538).

The judgment should be affirmed, with costs.

Sedgwick, Oh. J., concurred.


author: By the Court.—Truax, J.

text:
    SAMUEL VON WEIN, Appellant, v. THE SCOTTISH UNION & NATIONAL INSURANCE Co., Respondent.

      Insurance policy—cancellation of—notice of how given.—Presumption as to credit for premium.

    Where the terms of the policy of insurance provide that it may be canceled at any time by the company, on giving notice to that effect, such notice must be given to the insured in person, or to some one authorized by him to act as his agent to receive such notice.
    A broker employed to procure insurance has no authority to accept or give a notice of cancellation of the policy. When he procures the insurance, his agency ends.
    Although the policy provides that the broker procuring the insurance shall be deemed to be the agent of the insured in any transaction relating to the insurance, this condition applies only to matters occurring before the issuing of the policy.
    The delivery of the policy to the insured without requiring the jmyment of the premium, raises a presumption that a credit was intended, and the policy is valid.
    Where a credit has been given as above, it is not necessary for the company to return or tender the pro rata unearned premiums, as provided in the policy, to constitute a valid cancellation thereof, the company never having received the premium.
    Before Freedman and Truax, JJ.

      Decided December 7, 1885.
    Appeal from judgment entered on the verdict of a jury, and from an order denying a motion for a new trial on the minutes, on the grounds set forth in section 999 of the Code.
    The action was brought to recover upon a policy of insurance for a loss sustained by fire. Among other defenses, the answer set up an allegation that, in accordance with a condition in the policy authorizing a cancellation thereof by the company at any time on notice, and on return or tender of pro rata unearned premiums, the policy was duly canceled prior to the loss in question. It also alleged that the policy contained provisions that the company should not be liable until the actual payment of the premium, and that no officer, agent or representative of the company should be held to have waived any of the terms and conditions of the policy, unless such waiver should be indorsed thereon in writing ; and also alleged that plaintiff had not paid said premium.
    The policy was put in evidence, and contained the provisions referred to.
    Other facts appear in the opinion.

      Benno Loewy, for appellant.
    I. The policy in suit was in force and of binding effect, even though no premium had ever been paid thereon (Boehen v. Williamsburgh City Ins. Co., 35 N. Y. 131). The delivery of a policy without requiring payment, raises a presumption that a short credit is intended. Where it is to be inferred from the facts of the case that a credit is intended, the policy will be valid though the premium has not been paid (Angell v. Hartford Fire Ins. Co., 59 N. Y. 171; Hodge v. Security Ins. Co., 33 Hun, 589, and cases cited).
    II. The policy in suit was never legally canceled, as the pro rata unearned premium had never been actually paid or tendered to the assured prior to the occurrence of the loss, as provided in the policy. The case of White v. Connecticut Ins. Co. (120 Mass. 330), is a parallel case. The insurance had been obtained through a broker who had a running account with the company’s agent; the premium had not been paid; the policy contained the same clauses as that in suit. The defenses were that there had been no actual payment of the premium made necessary as a condition precedent to its validity ; and second, that the risk was terminated before the fire, by notice from the company. The court says : “ It is a fair-inference, for all this, that the duly authorized agent of the company had accepted the individual credit of Hunt (the broker), as a payment of the required premium. It is not a question of waiver by parol agreement of an express stipulation in a written contract, within the cases cited by the defendant. It is rather a compliance with the condition required to give validity to the policy within a large class of cases, in which it is held sufficient (Taylor v. Merchant Ins. Co., 9 How. 390 ; Miller v. Life Ins. Co., 12 Wall. 285 ; Sheldon v. Connecticut Life Ins. Co., 25 Conn. 207 ; Bonton v. American Life Ins. Co., 25 Ib. 542) and the court further held, as did also the court in Bennett v. Maryland Fire Ins. Co. (14 Blatch. 422), that the giving credit to a broker operates as a payment in legal effect of the premium, preventing cancellation by the company, without paying or tendering the return premium.

    The authorities uniformly hold that there can be no cancellation of a policy when once in force, without the payment or tender of the unearned premiums (Hathorn v. Germania Ins. Co., 55 Barb. 28 ; Van Valkenburgh v. Lenox Fire Ins. Co., 51 N. Y. 465 ; .Ætna Ins. Co. v. Maguire, 51 Ill. 342).
    III. There was no cancellation of the policy, even if notice without repayment of the unearned premium had been sufficient, as there was no notice to or act of the assured. The clause in the policy, making the person who procures the insurance “the agent of the assured, in any transaction relating to this insurance,” does not make such person the agent of the assured to give or receive notice of its termination (White v. Connecticut Ins. Co., 120 Mass. 333 ; Grace v. American Central Ins. Co., 109 U. S. 278 ; reversing Id. 16 Blatch. 433 ; S. C., 8 Rep. 771; 7 Ib. 388 ; Rothschild v. Am. Central Ins. Co., 74 Mo. 44 ; First National Fire Ins. Co. v. Isett, 14 Rep. 278 ; Latoix v. Germania Ins. Co., 27 La. Ann. 113 ; Hodge v. Security Ins. Co., 33 Hun, 583 ; Van Valkenbugh v. Lenox Fire Ins. Co., 51 N. Y. 465 ; Stilwell v. Mutual Life Ins. Co., 72 Ib. 385).

      Wetmore & Jenner, for respondent.
    I. The scope of Rieger’s authority extended to the cancellation of the policy as well as the procurement. The policy provided that he should be deemed the agent of the assured “in any transaction relating to the insurance.” This language is broad enough to cover the act of cancellation. Rieger’s agency did not terminate with, the procurement of the policies. It included at least the payment of the premiums, and did not terminate until the premiums were paid.
    Although the policy had been delivered by the company to Rieger without the payment of the premium, and the policy would have been good because credit for the premium had been given to Rieger, it was competent for the company and Rieger, to whom the credit had been given, and until the premium had been paid, to stop the period of the credit and cancel the policy (Armour v. Ins. Co., 47 Super. Ct. 352 ; Standard Oil Co. v. Ins. Co., 64 N. Y. 85).
    II. The agreement of the company and Rieger operated to cancel the policy. Rieger, the broker, went to the office of the company and said that Mr. Von Wien “had insurance enough without, and I told Mr. Talbot that I wanted him to mark it off and consider it as canceled.” Talbot (on behalf of the company) said, “We will mark it off and consider it off now ; we want you to get the policies back as soon as you can.” This was a present agreement of cancellation, which became operative from that moment to cancel the policy. By the terms of the policy a verbal notice or agreement was sufficient. The man who applied for the insurance asked for its cancellation. The policy did not require notice to be given to the assured himself. There was no premium to be refunded, none had been paid. That the notice was effective, see (Story Agency, % 140, and cases cited ; Standard Oil Co. v. Ins. Co., 64 N. Y. 85 ; Armour v. Ins. Co., 47 Super. Ct. 352 ; Ins. Co. v. Mueller, 8 Ins. L. J. 263; Bank of U. S. v. Davis, 2 Hill, 461; McEwen v. Ins. Co., 5 Ib. 101; Fulton Bank v. Canal Co., 4 Paige, 187 ; Boyd v. Vanderkemp, 1 Barb. Ch. 273).
   By the Court.—Truax, J.

The trial judge erred in allowing the defendant to prove that it had given notice of the cancellation of the policy to Rieger ; or, in other words, it was error to hold that Rieger was the plaintiff’s agent to whom notice of the cancellation of the policy could be given.

The evidence shows that Rieger was employed by the plaintiff to procure certain insurance, and that he procured that insurance. His employment—his agency— then ended, and notice to him was not notice to plaintiff.

The defendant claims that Bpitzer was plaintiff’s agent, and that Rieger was Bpitzer’s, and, therefore, plaintiff’s agent. But there is no evidence that tends to show that Bpitzer was plaintiff’s agent for any other purpose than the purpose of procuring insurance. When the insurance was procured, his agency ended.

This view of the case is not affected by the clause of the policy that the insurance broker ‘ shall be deemed to be the agent of the insured in any transaction ^elating ■ to the insurance. ”

The giving notice of cancellation of the policy does not relate to the insurance ; it relates to the cancellation of the contract of insurance, and not to the making of such contract. An authority to make a contract for another does not carry with it by implication, authority to cancel that contract (Hodge v. Security Ins. Co., 33 Hun, 583 ; Stilwell v. Mut. Life Ins. Co., 72 N. Y. 385 ; Van Valkenburgh v. Lenox Fire Ins. Co., 51 Ib. 465 ; Grace v. American Central Ins. Co., 109 U. S. 278).

This rule works no hardship to the insurer. The right to cancel the contract of insurance still remains. It only requires that' notice of cancellation shall be given to the insured, or to this agent to whom he has given an authority to receive such notice.

The cases of Rohrbach v. Germania Fire Ins. Co. (62 N. Y. 47), and Alexander v. Germania Fire Ins. Co. (66 N. Y. 464), deal with matters before the issuing of the policy (Whited v. Germania Fire Ins. Co., 76 N. Y. 415), and the court of appeals says in the case last cited, that it has not yet extended the clauses of the policy quoted above, beyond matters that occurred before the issuing of the policy (p. 419). I cannot find that it has extended that clause any farther since the decision of the Whited case. ' "

This remark is to be borne in mind while considering the case of Standard Oil Co. v. Triumph Ins. Co. (64 N. Y. 85), in which case, the persons who procured the insurance were the plaintiff’s agents generally for placing and keeping upon plaintiff’s property a large line of insurance (p. 86), and they returned the policy for cancellation (p. 81). The question of notice of cancellation to an agent is not in that case.

The policy of insurance was delivered to the plaintiff without requiring the payment of the premium. This raises the presumption that a credit was intended and the policy is valid (Washoe Tool Co. v. Hibernia Ins. Co., 66 N. Y. 613 ; Angell v. Hartford Fire Ins. Co., 59 Ib. 171; Bowman v. Agricultural Ins. Co., 59 Ib. 521). But the fact that credit was given, does not make it necessary for the defendant to offer to return a premium that it never had received.

The judgment and order appealed from are reversed, and a new trial is ordered, with costs to the appellant to abide the event.

Freedman, J., concurred.


text:
    CLAYTON PLATT, Appellant, v. THE RICHMOND, YORK RIVER & CHESAPEAKE R. R. CO., Respondent.

      Common carriers.—Bill of lading —effect when put in evidence generally— clause limiting liability in ease of fire.—Burden of proof-—-Contracts— by what law to be tested.

    In an action against a common carrier for loss of goods, where the bills of lading are put in evidence by plaintiff generally, and-without limitation, it cannot be claimed on appeal that they do not constitute the contract between the parties.
    Where the bill of lading contains a clause exempting the carrier from loss or damage by fire, unless such fire be proved to have occurred from the fraud or gross negligence of defendant or his agents, the burden is on plaintiff seeking ■ to recover for such loss, to show that the fire occurred from the causes enumerated.
    It appeared that the defendant was a Virginia corporation, and that its line was wholly operated, and the loss occurred in that state. The bill of lading in question containing the above limitation on the carrier’s liability, was given in the state of South Carolina, and it appeared that by the laws of that state, no special contract shall “limit or affect the liability at common law of any railroad company within this state, for or in respect of any goods to be carried and conveyed by them.” Held, that defendant not being a railroad company in the state of South Carolina, on the evidence herein was not bound by the laws of that state, and that the clause in the bill of lading limiting the carrier’s liability was operative.
    ' Before Sedgwick, Oh. J., and Truax, J.

      Decided December 7, 1885.
    Appeal from a judgment in favor of defendant, entered on a verdict of a jury under the direction of the trial judge.
    The action was brought to recover the value of sixty-five bales of cotton lost in transportation by the defendant, as a common carrier.
    The facts appear in the opinion.

      Chambers, Boughton & Prentiss, for appellant.

      Butler, Stillman & Hubbard, for respondent.
   By the Court.—Truax, J.

The bills of lading offered in evidence by the plaintiff are evidence of the terms of the contract between the parties thereto. It is true that on the argument before the general term, the plaintiff claimed that the bills of lading were not offered in evidence as contracts, but were offered merely as memorandums by which to identify the cotton in suit; but such claim was not made on the trial. The bills of lading were offered generally and without any limitation, and they were treated by the court and the parties to the action as the bills of lading for the cotton shipped by defendant to plaintiff’s assignor, so that it is now too late for the plaintiff to claim that they do not constitute the contract under which the defendant received the cotton.

By this contract the defendant was exempted from any responsibility for any loss or damage arising from fire, unless such fire were proved to have occurred from the fraud or the gross negligence of the defendant or its agents. This put upon the plaintiff the burden of establishing the fact that the fire occurred from the fraud or gross negligence ” of the defendant, its agents or servants (Whitworth v. Erie Railway Co., 87 N. Y. 413). But the evidence shows conclusively that the fire occurred without any fraud or gross negligence on the part of the defendant or its servants or agents, and it was not error to direct a verdict for the defendant unless, as claimed by the plaintiff, the contract is prohibited by the- laws of the states where it was made.

The cotton was shipped from different places in Georgia, North Carolina and South Carolina, to the plaintiff’s assignor in New York. The complaint alleges, and the answer admits that the defendant is a corporation created by and under the laws of the state of Virginia. The proof shows that the defendant’s road extended from Richmond, Virginia, to West Point, in the same state. The defendant was acting in Virginia as a member of the Piedmont Air Line, and the other lines that received the goods in Georgia and North and South Carolina. The goods were destroyed in Virginia.

The plaintiff offered in evidence chapter 65, section 2, of the Revised Statutes of South Carolina (1873), which provides that no special contract shall “limit or affect the liability at common law of any railroad company within this state for, or in respect of any goods to be carried and conveyed by them.” But the defendant is not a railroad company within the state of South Carolina, and on the evidence in this case is not bound by the laws of South Carolina.

The plaintiff also offered in-evidence certain portions of the laws of Georgia which prohibit common carriers from limiting their legal liability by notice, but these laws also provide that the carrier “may make an express contract, and will then be governed thereby.” This, we have seen, was done by the defendant in this case.

The only evidence before the trial court of the law of North Carolina on this point was the case of Smith v. N. C. R. R. Co. (64 N. C. 235), but this case is an authority that a common carrier may in North Carolina limit his liability by special contract, as was done in this case.

I am of the opinion-that there was no evidence before the trial court that either of the bills of lading which are the evidence of the contract between the plaintiff’s assignor and the defendant, was prohibited by the laws of the state in which the bill of lading was issued.

This view of the case renders it unnecessary for us to determine whether the defendant is, or is not entitled to the benefit to be derived from and under the policy of insurance mentioned in the. evidence.

The judgment appealed from is affirmed, with costs.

Sedgwick, Oh. J., concurred.


author: Ingraham, J Per Curiam.

text:
    HENRIETTA C. SMITH, Appellant, v. JOHN I. CORNELL, as Executor and Trustee, &c., Respondent.

      Subrogation—Eventual liability of party seehing.

    One whose own property is eventually liable for a claim, to the payment of which other property is applicable in the first instance, will not be subrogated in the place of the party who held such claim, and to whom the same had been paid out of the property of the party seeking a subrogation, as to the rights which, before such payment, he had to require satisfaction of such claim out of the property which in the first instance was applicable thereto.
    Thus, two parcels of land were delivered to an executor, on a valid trust to receive and pay rents during certain lives, and the remainder in fee descended to the heir at law; at the testator’s death, certain taxes were due and unpaid. Pursuant t,o a judgment of foreclosure and sale made June 11, 1883, as to one parcel, and a judgment of sale in an action for dorver made September 20, 1883, as to the other, these taxes were paid out of the proceeds of sale (the executor not having previously paid them out of the personalty), and the surplus funds were paid to the executor as trustee. The testator died January 24, 1883, leaving sufficient personalty wherewith to pay these taxes, which were preferred debts. Letters testamentary were issued February 12, 1883. The heir at law commenced the action February, 1885, praying to be subrogated in the place of the authorities to whom such taxes were paid, as to the amount thereof, and that defendant pay the amount thereof with interest, to her. Defendant, by his answer, set up that he had received all the known assets or personal property of the testator, and that the admitted unpreferred claims against the estate were largely in excess of the assets received by him, including such surplus funds. Plaintiff demurred to the answer, as insufficient in the law.

      Held, that the answer presented a good defense.
    Before Sedgwick, Oh. J., Van Vorst and Freedman, JJ.

      Decided December 7, 1885.
    Appeal from judgment entered upon order overruling demurrer to defendant’s answer, and from such order.-
    The complaint avers that the plaintiff is the only child, and heir at law of Gershom B. Smith, deceased ; that Gershom B. Smith died leaving a last will and testament, which was duly proved on February 12, 1883 ; that on the sanie day, the defendant qualified as executor ; that by the third clause of the will, the said Smith devised certain premises owned by him in fee, and known as Nos. 18 and 20 Howard street, in this city, to the defendant Cornell as executor in trust to take charge of and collect the rents and income of such premises during the lifetime of two nephews, Thomas and Benjamin Olipbant, and to pa.y over to three nephews which were named, and upon the further trust, after the death of the two first named nephews, to convey the premises to certain parties named in the will, if they should then be living ; that at the time of the death of the testator, No. 18 Howard street was subject to unpaid, taxes, which, with interest, amounted to about $2,615, and No. 20 Howard street was subject to unpaid taxes, amounting, with interest, to about $1,570 ; that No. 20 Howard street was, at the time of the death, incumbered by two mortgages made by him, one for $7,000, and the other for $3,748 ; that after the death, an action was begun for the foreclosure of the mortgages upon No. 20 Howard street, and a judgment of foreclosure and sale rendered, under which the premises were sold, and out of the proceeds of sale, the amount of unpaid taxes upon the premises, viz., $1,574, was paid, in accordance with the direction of the judgment; that there was a surplus of $1,215, after payment of the taxes, the amount due upon the mortgage, and all other charges, which' surplus was paid to the defendant as trustee under the third clause of the will; that the testator left a widow, Ann E. Smith, who became entitled to dower, and brought her action for it, and in that action judgment was rendered that No. 18 Howard street be sold, and it was accordingly sold on October 18, 1883, and from the proceeds the taxes unpaid upon the premises, were paid with interest, in the amount of $2,615, in accordance with the directions of the judgment; that after payment of all charges and expenses, there was a surplus of $3,232, which was paid over to the defendant as trustee under the will; that after the sales of both of the premises, the plaintiff began an action, in which a judgment was duly entered, declaring that the trust described in the third clause of the will, so far as it authorized the defendant to collect the rent of the premises Nos. 18 and 20 Howard street, during the lives of the two nephews, was a valid trust in lands, and vested in the defendant an estate in such lands for the joint lives of the two nephews, but that the trust to convey the fee after the termination of said two lives was not a lawful trust, and did not vest in the trustee any estate ; that upon the death of the testator, the fee descended to the plaintiff as sole heir at law, subject to the life estate described ; and it was further adjudged that each surplus above referred to, was to be deemed real estate impressed with the valid trust, and that, subject to the execution of such trust, the principal of said funds was vested in the plaintiff, and should be paid over to her upon the termination of such life estate, as the owner in fee of the land represented by such funds; that the taxes hereinbefore referred to, in aU $4,185, were a debt or claim against the estate of the testator, which the defendant, as executor, was bound in law to have paid out of the personal estate of the testator in preference to and before payment of any other debts of less degree ; that the testator left personal estate to the amount of $9,000 and upwards, and more than enough to pay said taxes, and by the neglect of the defendant to pay the same, the said taxes were paid from the said lands, in the manner before described by the complaint.
    The complaint asked as relief that the plaintiff “may be subrogated in the place and stead of the authorities of the city of New York, to whom, such taxes were paid, as to the amount thereof; that such amount and interest thereon be adjudged to be a preferred claim against said estate in favor of the plaintiff as taxes due at the time of the death of the testator ; and that the defendant, as such executor of the will of said G-ershom B. Smith, deceased, may be adjudged to pay the plaintiff the amount of said taxes and interest as such preferred claim, out of the personal estate of the deceased in his hands after deducting only his lawful commissions and the charges of administration.”
    The action was begun in March, 1885.
    The answer alleged: “ First, that the admitted claims of unpreferred creditors against the estate represented by him are largely in excess of the assets received by him as alleged in the complaint, and that defendant has received all the known assets or personal property belonging to the testator at the time of his death. Second, that said surplus funds were paid into the hands of the defendant pursuant to orders of the court entered in the actions of foreclosure and dower alleged in the complaint, on the application of this defendant and with plaintiff’s consent, she being a party to said actions, as was also this defendant.”
    The plaintiff demurred to this as insufficient in law.
    The court overruled the demurrer and ordered judgment for defendant dismissing complaint, with leave to plaintiff to withdraw demurrer on payment of costs.
   The following opinion was rendered at special term:

Ingraham, J

“ Assuming that the complaint alleges a good cause of action, I think the defense that the claims against the estate are largely in excess of the assets, including the amount of the surplus funds received by the executor as described in the complaint, is a good defense to the cause of action set up in the complaint.

“It is clear that the plaintiff would not be entitled to the judgment she demands. The trust in the will by the testator, so far as it authorizes the trustee to rent the property and collect the rents and profits, and to pay the same to the beneficiary named, is valid, and that vested the title to the land during the lives of the beneficiaries in the trustee. During such period, the trustee would therefore be entitled to the possession of the premises, and, under the judgment entered, would be entitled to the surplus realized on the sale of the premises. The only judgment that could be granted would be, that the executor pay to himself, as trustee under the will, the amount of the taxes paid, to be held under the valid trust contained in the will.

“The trustee would, therefore, be a devisee of the testator, and would be liable for his debts to the extent of the estate that was devised to him by the decedent (Code, § 1843).

“ The demurrer admits that the admitted claims of the unpreferred creditors are in excess of the assets of the estate, including this fund.

“'It is apparent, therefore, that the judgment directing the executor to hold this fund under the trust contained in the will, would merely render necessary another proceeding to compel the trustee to pay the debts of the estate out of the trust funds in his hands.

“In an action between the same parties to recover taxes on certain other real estate that had been purchased by plaintiff, the general term of this court appear to have held, that under such circumstances, the action could not be maintained.

“ I think, therefore, the demurrer should be overruled, with costs, plaintiff to have leave to withdraw demurrer on payment of costs.”

The plaintiff did not withdraw the demurrer, and judgment was thereupon entered, dismissing the complaint, with costs.

From such judgment plaintiff appeals.

Stilwell & Swain, attorneys, and Benjamin M. Stilwell, of counsel for appellants, argued:

I. The plaintiff had an estate in the lands which were sold, and applied to the payment of the taxes in question, for which she was not liable, and which should have been paid by the defendant as executor,, and is therefore entitled to subrogation, in the place and stead of the corporation authorities of the city, as a preferred creditor of the estate.

II. An executor is required by law, before paying any general creditor, to pay, out of the personal estate, all taxes imposed upon the lands of the testator, and unpaid at the time of his death ; and it is admitted that the defendant as such executor had in his hands sufficient funds to pay the taxes in question, and neglected to pay them, and they were collected from the plaintiff’s land. Whether or not the claims of unpreferred creditors against the estate exceed the assets, is entirely immaterial. It cannot be claimed, that because the assets are not sufficient to pay the general creditors, the executor is excused from paying the preferred creditors, to pay whom he has abundant funds in hand. Nor can the defendant, as executor, claim an offset or counter-claim, against the plaintiff’s claim or that of the defendant as trustee, on the ground that the plaintiff, as heir-at-law, or that the defendant, as devisee, may become liable for the general debts of the testator, because of the insufficiency of the assets. Neither the heir-at-law nor the devisee is liable to the executor, but only to creditors ; nor can the executor maintain any action against the heir-at-law, or devisee, to recover the value of the land descended (Code, § 1848). Even the creditors have no cause of action against the heir-at-law or devisee until the expiration of three years after the issue of letters testamentary (Code, § 1844), which time has not yet expired.

III. The real estate, upon which these taxes were imposed, having been sold under prior incumbrances, and the proceeds distributed, as required by law, no action could be taken by the executor in the surrogate’s court, under section 2750, to reach these lands or their proceeds, for the purpose of applying them to the payment of the debts. These proceeds could only be reached by creditors under sections 1848-9. The fact that the plaintiff as heir-at-law, and the defendant as trastee and devisee, are liable to the creditors of the testator, to the extent of the estate, right and interest in the real property which descended, or was devised to them, would seem to be a good reason why they should recover from the executor these taxes, which are in effect a part of the value of the real estate, in order that they may be in funds to pay the debts for which they are liable.

IV. The learned judge below, in holding, that to sustain this demurrer and give judgment for the plaintiff in this action, would only render necessary another proceeding to compel the trustee to pay the debts of the estate out of the funds in his hands, overlooked the fact that such proceedings against the devisee could be instituted by the creditors, and, after they had exhausted their remedy, against the heir-at-law {Code, § 1849). The fact that the plaintiff, or the defendant as her trustee, may hereafter, under certain contingencies, be called upon by creditors to account for the moneys recovered in this action, would seem to furnish no reason why the plaintiff and the defendant as her trustee should not recover the same from the executor. If the heir-at-law is responsible for the debts of the testator, it is not to be presumed that she will refuse to pay them, or that any action will be necessary to collect the same to the extent of her liability.

A. J. McCidlough, attorney, and Horace Secor, of counsel for respondent, argued:

I. Even if plaintiff, as heir-at-law, were entitled to payment of these taxes, in preference to other debts, she wrould not be entitled to the judgment asked. In that event, the judgment would direct the defendant to add the amount of the taxes to the surplus funds already in his hands, and hold the entire amount upon the trust set out in the complaint, the life tenants having the same rights as plaintiff, as reversioner.

II. A complete answer to this action arises from the fact that the admitted claims against the estate represented by the defendant, are largely in excess of the assets received by him, including the amount of the surplus funds received by him. It therefore appears that if these taxes were paid out of the personalty, the decedent’s real estate would have to be sold to pay his debts. As it is, this surplus will have to be applied to that purpose. So that, if plaintiff succeeded in this action, the amount of her recovery would be followed in a proceeding by the executor to apply it to the payment of testator’s debts. Therefore, the dismissal of plaintiff’s complaint saves circuity of action, and under the rule which forbids circuity in legal proceedings—circuitus est evitandus : in accordance with which a court of law will endeavor to prevent circuity and multiplicity of suits, where the circumstances of the litigant parties are such that, on changing their relative positions of plaintiff, and defendant, the recovery by each would be equal in amount (.Broom’s Leg. Max. 343, et seq.). The demurrer was properly overruled, and the complaint dismissed.

Per Curiam.

This judgment should be affirmed, for the reasons adduced by the learned judge below in his opinion.

It appears from the facts averred in the complaint and answer, that if the taxes had not been paid out of the proceeds of the real estate, the executor, in the ordinary performance of the duties of his office, would have paid, in the first instance, the taxes out of the personal estate, then he would have applied the remainder of the personal estate to the payment of unpreferred claims, and, there being a deficiency, would have sold in proper proceedings the land, so far as necessary to provide for the deficiency; or the creditors not paid, would have applied to have the land sold (Code, § 2749, et seq.).

The fact that before there appeared to be any deficiency, the property had been sold in actions of foreclosure and for dower, would not have affected the application of whatever surplus there might have, been, with or without taxes first deducted ; for that surplus would be treated as if it were real estate (Code, §§ 2797, 2798). And the application of the defendant’s estate as trustee would have been postponed to the application in the first place of the remainder in fee in plaintiff (Code, § 2764).

As it stands, if the taxes be deemed paid, there will’ be a less deficiency of assets to pay the unpreferred claims, and the plaintiff’s estate will be to that extent relieved from the former obligation to pay the deficiency. If the amount of taxes that have been paid were now separated from the personal estate, and placed in the defendant’s hands as trustee, as real estate, it would, in the end, have to respond to the deficiency, that by the answer, admitted by the demurrer, it is certain there would be. And then the plaintiff would stand where she does now. In the end, the plaintiff will get all the interest she is entitled to have in the testator’s personal or real estate. The defendant, as executor, represents the right of creditors, and can interpose any equity in their behalf that they could interpose in person. If these views be correct, this action is simply to change a method of administration, when the change asked will not benefit the plaintiff pecuniarily.

The judgment should be affirmed, with costs, with leave to plaintiff to withdraw demurrer upon payment of the costs of the demurrer, and of the appeal.

      Smith v. Cornell, 51 Super. Ct. 354.


author: Per Curiam.

text:
    WILLIAM A. PITT, Respondent, v. AUGUSTUS C. DOWNING, Appellant.

      Evidente insufficient to warrant a recovery.—Performance of contract— following directions, when justifies finding of.—No offer to return, using, effect of.

    Plaintiff had three separate contracts with defendant for doing work and furnishing materials; on one he was to receive the cost of the labor and materials, and ten per cent, thereon ; on the other two he was to receive a specific sum. To sustain his claim on the first contract, he proved in a certain manner the value of the work and materials; he also proved that the stipulated compensations in the other contracts would not give him ten per cent, on either of them; he then testified that the whole bill for everything done under all the contracts, did not net him a greater profit than ten per cent.

      Held, insufficient to establish what the cost of the work and materials, under the first contract was, or what that cost, with ten per cent, added, would amount to, and not warranting a recovery on that contract.
    The plaintiff contracted to put in a house a steam heating apparatus, which should properly heat it. Defendant claimed that the apparatus, as put in, did not properly heat the house. The testimony admitted of the construction that the failure so to heat was due to the size, kind and situation of the boiler, as to which plaintiff followed defendant’s directions.

      Held, that upon the finding of said facts, a finding that plaintiff had performed his agreement, was justified.
    The not offering to return, using when such use is contemplated by the contract, to test whether the thing furnished comports with the contract, and the calling on the party furnishing to remedy defects, will not give an action on the contract if it has not been complied with; but may be used as evidence, in connection with all other pertinent facts bearing on the questions of waiver, or acceptance, or of performance.
    Before Sedgwick, Oh. J., Van Vorst and Freedman, JJ.

      Decided December 7, 1885.
    Appeal from judgment in favor of plaintiff against defendant, entered on report of referee.
    The facts appear in the opinion.

      Joseph W. Howe, attorney, and of counsel for appellant.

      Arnoux, Rich & Woodford, attorneys, and of counsel for respondent.
   Per Curiam.

This action was brought to recover $9,523.42, as a balance due the plaintiff for work done and materials furnished by plaintiff at request of defendant in plumbing, gas-fitting, steam-heating and roofing a dwelling-house of defendant. The plaintiff claimed to recover for the value of the work and materials furnished by him.

The answer averred that all the work and materials referred to in the complaint, were done and furnished under three separate special contracts. One related to plumbing and gas-fitting, and by it the plaintiff agreed to do the plumbing and gas-fitting for the cost of the labor and materials, with ten per cent, added. The second was for the roofing, and provided that the plaintiff should be paid $568. The third related to the steam-heating apparatus, and in it the plaintiff contracted to put steam-heating apparatus in the house for the sum of about $4,000, and agreed that he would put it in in a workmanlike manner, and that the same, when put in, should accomplish the purpose for which it was intended, namely, the proper warming and heating the said house. _

The referee found that the gas-fitting and plumbing were done under a special contract, like that in the answer. This would entitle the plaintiff to recover the amount provided to be paid to him by that contract. In a certain manner he proved the value of the work and materials. As there would be no presumption that this value was cost and ten per cent., it would not be the measure of his recovery. He beyond this proved, that the stipulated compensation for the roofing, &c., would not give him ten per cent, profit, and for the steam-heating apparatus would not give ten per cent, profit, and then he testified that the whole bill for everything that he did on the house, including the two contracts, did not net him a greater profit than ten per cent. There was no other evidence on the subject. It could not be inferred, from the testimony given, that the charge for plumbing and gas-fitting did not include more than ten per cent, on the cost of the work and materials. As the referee based the plaintiff’s recovery upon the special contract, and as there was no proof that the plaintiff’s charges in his bill accorded with the stipulated compensation, there must be a reversal of the judgment.

As to the steam-heating apparatus, the referee found that the plaintiff contracted with the defendant to put a steam-heating apparatus in his house for $3,936, which, when put in, should properly heat the house.

Undoubtedly, if the steam apparatus did not properly heat the house, the plaintiff would not have the right to recover.the stipulated sum, unless he showed a sufficient excuse for any deficiency in that respect. The referee refused to find that the steam-heating apparatus did not properly heat the house, after having found that the plaintiff performed his agreement in respect to it. The defendant’s counsel claims that the plaintiff’s own testimony on this point admits that the apparatus was not sufficient, because it gives excuses for deficiencies in this respect. It appears, however, that these excuses consist of directions that were given by the defendant through his architect to make certain parts of the apparatus,-—for instance, the boiler,—of a certain size and kind. The testimony admitted of the construction that if the apparatus failed to supply enough heat, it was due to the size and kind and situation of the boiler. If these followed the direction of the defendant, then the plaintiff’s contract would in substance be that the apparatus was to heat the house as well as might be with the use of- the boiler of the kind chosen by the defendant, placed according to the direction of defendant. If the referee found these facts to be as testified to by the plaintiff, he was justified in finding that the plaintiff had performed his agreement.

The findings proceed in favor of plaintiff on another ground. It is found that “the steam-heating apparatus was completed by the winter of 1881-82, and was in use during that winter and subsequently. No offer to return any part of it was ever made by the defendant to the plaintiff, but the plaintiff was called upon by the defendant, and did from time to time do certain work upon it, with a view to remedying defects as they were discovered.”

If the defendant did in effect accept the work, as satisfactory to him under the contract, there is no reason that he should not be liable for the contract price. This is said of this contract, in consideration of the uncertain condition of ‘ ‘ properly heating ” the house. To a certain extent that would be matter of opinion or judgment, and the defendant’s acts might conclude him.

The mere using of the apparatus, inasmuch as such use was contemplated by the contract for the purpose of ascertaining if the house could be properly heated by it, and the calling upon the plaintiff to remedy defects, and then the omission to offer to return such parts as could be severed from the house without damage, provided the special contract had not been complied with, would not have given an action upon the contract. If, as the referee has found, the contract had been performed, that ends all doubt; but if not, the particular facts alluded to will not necessarily show a performance. They can be used as evidence in relation to whether there was a waiver •of performance or an acceptance in fact with a waiver, and also, whether there had been performance, and as evidence they must be considered with all the other pertinent facts of the "case (Smith v. Brady, 17 N. Y. 173). This case shows that in an action upon a special contract, performance or waiver of performance must be proved to uphold a recovery upon it. There is no question presented on this appeal as to the right of the plaintiff to recover for the reasonable value of the steam-heating fixture.

No question has been made on this appeal as to the plaintiffs right to recover under the contract for roofing.

For the error in the judgment as to the plumbing and gas fitting, the judgment is reversed, and a new trial ordered, and the order of reference vacated, with costs of the appeal to abide the event.