author: PARKER, J.:

text:
    Booth Brothers and Hurricane Isle Granite Company and Others, Respondents, v. Matthew Baird and Charles Hart, Appellants, Impleaded with Others.

      General mage — knowledge of it, is presumed — knowledge of local mage, not presumed— meaning of “superficial yarrd.”

    When the usage in relation to matters embraced in a contract is reasonable, uniform and well settled, not in opposition to fixed rules of law, nor in contradiction of the express terms of the contract, and when the usage is so far established and known to the parties that it may be supposed that the contract was made iu reference to it, it is deemed to form a part of the contract, and may be shown in order to enable the court to declare what the contract expressed to the parties.
    There are usages, however, so restricted to locality, trade or business, that a party, ignorant of them, is not presumed to have contracted with reference to them. Alocal meaning of the phrase “ superficial yard,” contained in a contract, where such meaning is claimed to be other than its obvious one, must bo clearly established.
    Appeal by tlie defendants, Matthew Baird and another, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of New York, on the 3d day of April, 1894, upon the report of a referee.
    This action was brought to recover of the defendants a balance claimed to be due under the following contract:
    “New York, March 19th, 1889.

      “ Messrs. Matthew Baird, JohN G. Smith, William Nelly, Charles Hart:

      “ GeNtlemeN — We will furnish you ten millions granite paving blocks, 9 inch and upwards in length, three and one-lialf to four and seven-eighths inches wide, and from 7 to 8 inches deep, which shall be acceptable to the departments under which they are to be used, provided the specifications are tlie same as named by the said departments for the year 1888, during the season ending December 31st, 1889. The blocks to be used in the cities of New York and Brooklyn, and to be delivered on such docks in said cities as yon may designate, in equal monthly installments, as near as may be, subject to delays in transportation and obtaining transportation, occasioned by the dangers of the sea and the acts of God, for the following sums:
    “For all blocks used by you in the city of New York, one dollar sixty-seven and one-half cents ($1.6Y-J) per superficial yard.

      “ For all blocks used by you in the city of Brooklyn, one dollar and sixty-five cents (Si.65) per superficial yard.
    “For all blocks sold by you to be used on contracts other than your own, seventy-nine dollars ($19) per M., to average 21 blocks to the superficial yard, said blocks to be paid as follows:
    “ Twenty dollars per thousand on the Wednesday following the delivery of each thousand. Forty dollars per thousand on the 10th of each month for all blocks delivered the preceding month, and the balance on all blocks laid by you, the time of the completion and acceptance of the contract in which said blocks are used, and the balance of all blocks sold by you as aforesaid thirty days after delivery of same.
    “ You to provide good and suitable, docks for each vessel forty-eight hours after notice of her readiness to deliver blocks under this arrangement, and to receive said blocks at the rate of not less than one hundred tons per day, Sundays, holidays and rainy days excepted.
    “In the event that both of the cities of New York and Brooklyn do not make contracts requiring the use of ten millions of blocks, then the number of blocks to be taken by you under this arrangement shall be equal only to the number required under the said contract made by the said cities.
    “We will also carry for you at our quarries a number of blocks, not exceeding three millions, during the time covered by this arrangement upon your payment to us on account thereof $40.00 per thousand for so many as shall be thus carried.
    “Your early reply to this is waited.
    “ Very respectfully yours, *
    “BOOTH BROS. & HURRICANE ISLE GRANITE 00.
    “JohN Booth, Treasurer.

    “ NEW YORK, ME. GRANITE P. BLOCK. CO.
    “ By JohN Pieece, President.

    “ROCKPORT GRANITE CO.
    “ By Chas. S. Rogers, Treas.

    “ Accepted: Matthew Baied,
    JOHN G. SMITH,
    WilliaM Kelly,
    Ohaeles Haet.

      •“ Witness:
    “ CHARLES S. FiíEGuSON.”

      The plaintiffs recovered a judgment for $42,641, besides costs.
    The recovery is on the basis of the engineer’s measurements in Brooklyn, which includes the space occupied by railroad tracks and. manholes, where necessarily there was no granite.
    The importance of this item is suggested by the testimony of Dwyer, an engineer, who says that on the work done by the defendant Hart, the basis of computing the number of yards adopted by the referee, gives to the plaintiffs 6,253 square yards where no-granite blocks were in fact laid, which at $1.65 per yard amounts to-$10,317.15.
    The recovery includes a large amount for granite where none was-in fact laid by each of the other defendants, and the controversy involves a substantial amount.'
    The referee did not hold that the language employed in the contract, in the absence of evidence as to custom, would entitle the plaintiffs to recover for the entire superficial area of the streets-paved, less crosswalks or bridges, but that the evidence adduced as to the meaning of the term “ superficial yard ” showed that the term referred to the superficial yard measurement as given by the engineer in charge of the work for the city. His finding upon that subject-reads as follows:
    “ Third. That the price of the blocks sold by plaintiffs -to the defendants in and by the said contract as laid or used in the cities-of New York and Brooklyn, was fixed by a rate per superficial yard ; that the meaning of the term ‘ superficial yard,’ on the evidence, is the superficial yard measurement of the pavement laid and measured by the engineer in charge of the work for the city and returned to the city department. That said measurement in Brooklyn included a superficial area of the street paved, less or excluding the crosswalks or bridges and the receiving basins at the street cor- ' ners, but including all the other superficial area of the street paved.
    “ In Brooklyn no allowance upon or deduction from such measurement was made for railroad tracks, nor for sewer manholes,, when there were such in the street. In New York an allowance upon and deduction from such measurement was made for railroad tracks.”’

      Jesse Johnson and John C. Shaw, for the appellants.

      George F. Harriman, for the respondents.
   PARKER, J.:

It is conceded that, in the absence of evidence establishing that the term superficial yard,” as used in the contract, has by long-established usage come to mean the measurement of superficial yards as made by the engineer of the city of Brooklyn in chai’ge of the work, there could have been no recovery for the space occupied by railroad tracks and manholes.

"Whether the referee was right in deciding that the contract should be read as if it had been written, “Por all blocks used by you in the city of Brooklyn, one dollar and sixty-five cents., per superficial yard, to be determined by the measurements made by the engineer of the city of Brooklyn in charge of the work,” we shall consider.

It has long been the law of this State that usuage, in relation to matters embraced in a contract, when it is reasonable, uniform, well settled, not in opposition to fixed rules of law, not in contradiction of the express terms of the contract, and so far established and known to the parties that it may be supposed the contract was made in reference thereto, is deemed to form part of it, and may be shown in order to enable the court to declare what the contract expressed to the parties. (Walls v. Bailey, 49 N. Y. 464; Newhall v. Appleton, 114 id. 140; Smith v. Clews, Id. 190.)

In Walls’ case, in which Folger, J., delivered a well-considered opinion, reviewing at length the authorities bearing on the question, a contractor, who had agreed to plaster defendant’s building at a certain price per yard, made no deduction in his bill for cornices, baseboards, or openings for doors and windows.

On the trial it was proved that it was the uniform and well-settled custom of plasterers in Buffalo to so measure. It was held that the evidence was proper, and raised a presumption that defendant contracted with reference to that usage.

The judgment was reversed, however, because the defendant was not allowed to testify that he did not have knowledge of the custom claimed, and this was because the plaintiff had established a local usage as distinguished from one that is general.

The distinction pointed out after full discussion, was, that there are usages so general, and so universally received and acted upon, that they have become a part of the common law, and no one can be beard to profess ignorance of them. While, on the other hand, there are usages so restricted to locality or trade or business that ignorance of them constitutes a valid reason why a party may not be held to have contracted with reference to them.

It was the local usage in Brooklyn that the plaintiffs attempted to establish. It is not suggested by the testimony that the usage claimed is general. Indeed, it affirmatively appears that such custom does not prevail in the city of New York. These deductions, such as the defendants contend for here, are required.

The defendant Hart testified that down to the time of the making of the contract he never knew or. heard of any such custom, usage or practice as that contended for by the plaintiffs. His testimony brought him within the ruling of Walls’ case, but as he was a party to the action the referee was not bound by his testimony, although not directly contradicted.

"While he made no finding upon the subject, and may have treated this case as one where the general rule as to the effect of usage upon parties applies rather than the restricted rule applicable to a special locality, we must, nevertheless, assume that lie has found as a fact that he did know of it. And so assuming, we pass it without special consideration, because we think the evidence fails to show that the term “superficial yard,” as between contractors and producers of granite, has by local usage become so firmly established to mean “ superficial yards, as determined by the measurements of the engineer in charge of the city of Brooklyn,” as to be engrafted upon all contracts containing it on the assumption that the parties contracted with reference to it.

A brief analysis of the testimony will suffice to justify our conclusion. The first witness called by the plaintiffs on the question of usage was John Pierce, who testified that he had had considerable experience'in selling paving blocks, and that he had never sold them in any other way than on the engineer’s measurement. But there is nothing in his testimony which shows that the words “ superficial yard,” as used in this contract, had a definite and well-established meaning in the trade,- such as is claimed for them by the plaintiffs. The inference to be drawn from his testimony seems to be otherwise, for he stated that he usually sold the blocks by written contract, and that while he received pay for them on the basis of the engineer’s measurement, lie further stated : “ I can’t say whether it was put that way in the contract or not; I can’t say.” It seems that in the early days of granite pavement in Brooklyn the Rockport Company, of which Pierce was the president, sold a quantity of granite blocks to a contractor by the name of Dady, and when the time came for settlement Pierce, in behalf of his company, claimed the right to be paid on the basis of the engineer’s measurements, while Dady insisted that he was only entitled to receive payment according to the number of yards, to be ascertained by actual measurement. Pierce’s company finally settled with Dady, making in the main the deductions insisted upon, after which Pierce stated that in the future his contracts should specify engineer’s measurements.

Charles S. Ferguson, the assistant secretary of one of the plaintiffs, did testify that there was a custom among granite block sellers and layers in the cities of Brooklyn and New York in relation to the method of measurement, when blocks are sold by the superficial or square yard, and that such custom is to take the measurements filed by the city engineer. His testimony, therefore, may be said in a general way to fairly meet the situation, although he -failed to state a single instance where a written contract, in which the term “ superficial yard ” was used, was construed by the parties to mean that which he says was the established custom.

William Kelly, one of the defendants not appealing, also testified in a general way that it was the custom to make settlement according to engineers’ measurements.

He does not suggest an instance where a written contract providing that payment should be at a certain price per superficial yard was construed by the parties to mean superficial yards as determined by the measurement of the city engineer. Indeed, he testifies that prior to the making of the contract in question he had had but one contract where railroad tracks ran along the length of the pavement, and that was on Front street in Brooklyn. With reference to that contract he testifies: “ It was agreed that they were to be paid by engineers’ estimates. I made an agreement and signed it, to pay Booth Brothers that way, and I paid them by engineers’ measurements.” Had a similar agreement been made here, there could have been no such question as is now presented! While his testimony shows what he did under this particular contract, it does not show, or even tend to establish, that the term superficial yard ” has that well-understood and settled local meaning for which plaintiffs contend.

The defendant John O. Smith also testified that he made payments to the plaintiffs, under this contract, according to the engineer’s measurements, but he admits that he purchased of the plaintiffs all of the blocks which he used during the six years last past in Brooklyn by the thousand.

His personal experience touching the established local meaning-of the term “ superficial yard ” is confined to this contract, and,, therefore, does not tend to establish that it had a meaning other and. different from that given to it by the dictionary prior to the making-of this contract. No other witnesses were called by the plaintiffs-upon this branch of the case.

Their testimony does not justify a finding that at the time of the making of the contract the local usage of the term “ superficial yard ” was firmly established in the granite trade to mean something different from that which the term ordinarily imports.

"When, however, this testimony comes to be considered in connection with the evidence introduced by the defendants, it will appear that there never was any such established custom. It is testified to, and not disputed, that until 1885 it was the custom to purchase blocks by the thousand. That custom has been continued by many, but some of the contractors have from time to time made contracts for blocks to be paid for by the yard. "Whatever of custom there is, therefore, has grown up during a period of less than six years-immediately preceding the making of this contract. One of the witnesses produced by the defendants to prove that there was no such custom, was Yan Brunt Bergen, who for many years had the general superintendence and charge on behalf of the city of all the paving done for it. It is fair to assume that his position was-such that any custom between contractors and sellers of granite would be more likely to come to him than to the average businessman.

He testified that the fact is that the city, in paying the contractor, measures in the railroad iron. And it is so understood when the contracts are let, and the bids are made accordingly. But he declared that he had never heard of any custom, or a claim of a-custom, that the persons who furnished stone by the yard should have the railroad iron included in their measurements.

He gave an instance where the city had purchased granite blocks of one of these plaintiffs within two years of the time of the making of the contract in controversy.

The stone was purchased by the square yard of pavement on the requisition of the commissioner. One of the plaintiffs talked with the witness about making allowance for the space occupied by the railroad tracks before requisition was made, but the representatives-of the city refused to make any such allowance, and the result was-a requisition which was an equivalent to the contract in question. It-was subsequently carried out, the expression being treated as meaning precisely what would be its ordinary dictionary meaning. This-transaction of itself affords the most satisfactory proof that Booth Brothers, who are plaintiffs here, and the superintendent of paving' in the city of Brooklyn, did not know of the existence of any such, custom as the plaintiffs claim on this trial. One of the earliest-departures from the plan of buying blocks by the thousand was-through a contract between the Rockport Company, one of these-plaintiffs, and Dady and Oox, contractors. This contract was spoken of in considering the testimony of Pierce, the president of the company. We refer to the subject again because of the testimony of Dady and Cox. Cox points out that the real difference between Pierce and his firm was, that they refused to pay for the space taken by the railroad iron, while Pierce demanded payment for railroad-iron on engineer’s measurements.

But, finally, he says Pierce agreed to accept actual measurement' and a settlement was had on that basis. Dady testifies that after the-settlement was made, Pierce said that hereafter he would have a provision for engineers’ measurements inserted in their contracts. That-statement Pierce did not deny, nor did he attempt to make it appear' that he ever caused to be executed a contract other than the one in question, in which it was not provided that payments should be made according to the engineer’s measurements if the parties-had so agreed.

Thomas Monahan, who is largely engaged in paving streets with Belgian block, cobble stone and other material, says that he usually purchased his blocks by the thousand, but in the year 1889 he did make a purchase of blocks by the yard, but the contract provided that they should be paid for by the engineer’s measurements.

John H. O’Rourke had but one contract by which he agreed to pay for blocks by the yard prior to June, 1889 ; up to that time he bought mostly by the thousand. In answer to an inquiry whether the engineer’s measurements are usually specified in contracts or agreements, whether in writing or verbal, he answered: “ I .can only speak for myself; when I made a contract with Hr. Pierce (president of one of the plaintiffs) it was always agreed virtually between us that it was engineer’s measurement; * * * that is all the custom there is about it, the agreement that I make; I think that is all.”

Edward J. McKeever testified that the firm of which he was a member purchased blocks of one of the plaintiffs by the yard and paid for them by actual measurements. This the plaintiffs felt •called upon to answer in rebuttal, and they ju’oduced the contract by which the parties agreed that the settlement should be upon the basis of engineer’s measurements, but if the engineer’s measurements should include space occupied by rails that such space should be •deducted and allowed on the final payment. This only emphasizes what was undoubtedly the fact, that in some cases it was agreed in the first instance that the engineer’s estimate should be accepted as final without any deduction for rails or manholes, while in others it was agreed that there should be deductions.

"We have already referred to the testimony of the defendant Hart to the effect that he never knew or heard of any such custom or •usage as that claimed by the plaintiffs and found by the referee ; .and he refers specially to a contract made between him and the plaintiff, the New York Granite Company, in which the price was fixed by the company as follows : One dollar and seventy-five cents per square yard on the engineer’s measurement “ when laid in the street.” A reply was prepared by its president (Pierce), and by it Hart was made to say, I hereby accept your proposition ” at so much per square yard on engineer’s measurement when laid in the .street.”

In this particular case, therefore, it will be observed that he was .careful to’ have engineer’s measurements incorporated twice, evi~ dently intending that there should be no room for dispute as to whether iron and manholes should be measured as stone delivered by the company.

The testimony in this voluminous record would permit of a more extended discussion of the evidence bearing on this subject, buf our purpose has been, as briefly as possible, to make it deal that there is nothing in this testimony to support plaintiffs'' claim that by an established custom the term “ superficial yards” has come to mean superficial yards according to the city engineer’s measurements. If the evidence may be said firmly to establish anything about the question, it is that sometimes the parties agree to include rails and manholes in the measurements of stone and pay for the space they occupy as such, and in other cases they do not. "Whatever they agree to, if the contract is reduced to writing, finds expression in it. The term superficial yard ” is not used in one case to mean the engineer’s measurements without deduction for rails and manholes, and in the other that only actual measurement of stone shall be paid for.

According to the testimony of Engineer Dwyer, whether this contract shall be read as its language imports, or as the plaintiffs claim the evidence shows it should be read, involves to one of these appellants something over $10,000, and justifies him in insisting that the plaintiffs shall be compelled to establish it before he shall be deprived of the right apparently secured to him by the provisions of the contract. We agree with him that the. testimony contained in this record does not establish the custom which has been claimed to exist.

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

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

Judgment reversed as to appellants Hart and Baird, and new trial ordered, with costs to appellants to abide event.


source: Caselaw Access Project

author: Parker, J.:

license: Public Domain

text:
    Thomas A. Patteson, Jr., Respondent, v. The Ongley Electric Company, Appellant.

      Corporation — contract signed by its president — burden of proof— ratification of the act of its prresident.

    Where a promisee sues upon a contract made with him in the name of a corporation by its president, and the contract is one which the company could authorize its president to make or one which it could ratify when so made, the burden rests upon the corporation to show that the act of the president was unauthorized.
    The specific acts which constitute a ratification, considered.
    Appeal by the defendant, The Ongley Electric Company, from .a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 19th day of February, 1895, upon the verdict of a jury rendered by direction of the court after a trial at the New York Circuit.

      Rufus W. Peckham, Jr., for the appellant.

      John R. Dos Passos, for the respondent.
   Parker, J.:

In pursuance of a written contract signed The Ongley Electric Co., T. W. Robertson, President,” the plaintiff’s assignor, J". E. "Wiechers, undertook to, and did sell 1,500 shares of the treasury stock of the Ongley Electric Company for $90,000, upon an agreed commission of five per cent; $1,550 was paid out of the treasury of the company to "Wiechers on account of the commissions, but it has refused to pay the balance. The ground on which defendant bases its refusal to pay is that the president had no authority to make the contract.

The facts are, briefly, that on the 5th day of April, 1892, plaintiff’s assignor received a letter signed The Ongley Electric Company, T. W. Robertson, President,” in which reference was made to a conversation of the day before had between "Wiechers and Robertson on behalf of the electric company, which concluded with the proposition that for services to be rendered, the company would pay a commission of five cent upon the proceeds of the stock sold.

Subsequently, but on the same day, plaintiffs assignor received a contract signed as stated in the opening sentence, which provided, among other things, that he should receive a commission of five per cent, on account of stock sold for cash, for his services. "Wiechers brought about a sale of 1,500 shares to a Mr. Hopkins at sixty, making a total purchase price of $90,000. The contract of sale between the Ongley Electric Company and George B. Hopkins was in writing and signed in precisely the same manner as the contract with plaintiff’s assignor. It appears from the minutes of the board of directors that subsequently the contract of sale with Hopkins was fully ratified, and touching that general subject there was adopted a preamble and resolutions. One of the resolutions reads as follows: “ Resolved-, that all and every the acts of the president of this company and •of the said J. T. Thompson & Co. in respect of the stock which belonged to this company, above referred to, be and hereby are in all things approved, ratified and confirmed.” After the stock had been transferred to Hopkins and the defendant had received the price agreed to be paid therefor, Wiechers received $1,550, which was paid to him in five cheeks of the defendant, each of which was signed by the president and treasurer of the company.

These checks were paid in due course, and subsequently came back to the company. When produced upon the trial there was stamped on the face of each check the following : “ Henry M. Tate, Auditor, Feb. 3, 1893.”

The first check bears date November 10, 1892, and the last one November 21, 1892. In February following there was a meeting of the directors and stockholders of the defendant, at which Wiech•ers was present. At this meeting there was presented a balance sheet taken from the books of the company, which, among other things, purported to state the indebtedness of the company, and to whom such indebtedness was due, and that the same had been duly audited by Henry M. Tate, auditor of the company. This statement represented that there was due to Wiechers the amount which is claimed in this action. Wiechers says that there was no objection by- any one, and that there was a resolution adopting the statement as a whole. This statement is not controverted. On the contrary, it is fully corroborated by the books and testimony of certain officers -of the company.

John B. Underhill, who was at the time of such meeting the secretary of the company, read the following extract from the book of minutes of the company : “ The treasurer submitted a statement of the company of December 31, 1892, audited by Mr. Tate, the auditor of the conrpany. Mr. Dixon asked for the results, and on his being shown the balance sheet and examining it, moved that it be accepted, which motion was seconded bv Mr. Hopkins and Mr. Devine and passed by all present.”

There is no pretense that the president or other officers of the company attempted to keep away from the directors and stockholders the facts relating to the contract by which it was agreed to pay to Wiechers his commissions.

Borne of the officers at least knew it at about the time the contract was made, and it does not appear but that all of them did.

The secretary of the meeting, who was called by the defendant, admitted that he know that Wiechers was negotiating for the sale of the stock with Hopkins, and that it was agreed that he should receive live per cent for commissions if successful.

The transaction was entered upon the books of the company in the regular way, an account being opened with Wiechers after the sale of the stock in which he was charged with the payments made on account. And the bill of Wiechers came regularly to the attention of the auditor employed by the company to audit its accounts, who after making the audit, entered it in the statement as we have already observed, which in duo course came before the directors and stockholders at a meeting at which a majority of both were present.

This statement, as we have seen, was after an examination accepted and passed. It does not appear that there was any other method by which this company formally passed upon claims against it. At the close of the testimony the court directed a verdict in favor of the plaintiff for the balance claimed to be due, with interest.

We think this judgment can stand for two reasons :

(1) Because the contract made in the name of the corporation by its president is one the company had power to authorize the president to make or to ratify after he had made it, and, therefore, the burden was upon the corporation of showing that it was not authorized. (Patterson v. Robinson, 110 N. Y. 193 ; Jourdan v. L. I. R. R. Co., 115 id. 381; Oakes v. Water Co., 143 id. 430.)

This burden the appellant did not meet. Its counsel correctly states in his brief that all the evidence offered by either party, which in any way tended to show the powers of the president, was put in evidence by the defendant and consisted of a resolution of the board of directors appointing the president and two other members of the board an executive committee to act in minor matters.

(2) The evidence of ratification and approval by the defendant,, its officers, directors and stockholders, was so complete as to justify the direction of a verdict.

The appellant urges that this question ought' to have been submitted to the jury, but it seems to us not.

There was no disjiute as to the facts. The history of the transaction, from the date when the president signed the contract down to and after the meeting of the directors and stockholders, at which the auditor’s statement was presented, seems to be complete. No part of it is in conflict, and, therefore, it was proper for the court to determine what conclusion of law should follow from the undisputed facts.

The judgment should be affirmed, with costs.

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

' Judgment affirmed, with costs.


author: Parker, J.: Van Brunt, P. J.

text:
    Sarah Gleeson, as Administratrix, etc., of William J. Gleeson, Appellant, v. John Brummer, Respondent.

      Negligence — burden of proof as to freedom from, contributory negligence.

    In an action brought to recover damages, alleged to have resulted from the negligence of the defendant, the burden of proof is upon the plaintiff to show that he was free from contributory negligence.
    The rule laid down in Hart v. Hudson River Bridge Company (84 H. Y. 62) is still the law of the State.

      Tolman v. 8., B. & N. Y. R. R. Co. (98 N. Y. 203) and Calvin v. Mayor (112 id. 228), distinguished.
    Van Brunt, P. J., dissenting.
    Appeal by the plaintiff, Sarah Gleeson, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of New York on the 23d day of March, 1894, upon tlie dismissal of the complaint directed by the court after a trial at the New York Circuit before the court and a jury.

      Dudley R. Horton, for the appellant.

      E. W. S. Johnston, for the respondent.
   Parker, J.:

We agree that the jilaintiff failed to show freedom from contributory negligence on the part of Gleeson, within the rule laid down in Hart v. The Hudson River Bridge Co. (84 N. Y. 62); Hale v. Smith (78 id. 483); Warner v. N. Y. C. R. R. Co. (44 id. 471); Reynolds v. N. Y. C. & H. R. R. R. Co. (58 id. 248), and Cordell v. N. Y. C. & H. R. R. R. Co. (75 id. 330).

Whether the rule of contributory negligence announced in these .cases has since been overruled, presents the real point of difference.

The presiding justice is of the opinion that this result was accom-plished by the decisions in Tolman v. S., B. & N. Y. R. R. Co. (98 N. Y. 203), and Galvin v. The Mayor (112 id. 228).

It must be admitted that the expressions quoted from the opinion in Tolman’s case are not in harmony with the rule of the previous decisions, but it should not be held by this court that by it the Court of Appeals intended to overthrow the then existing rule and establish a radically different one, for two reasons: 1. Because the court was entirely familiar with the rule and the cases establishing it, and would have carefully considered and distinguished them had its purpose been to accomplish a modification of the rule. This was not done, nor were the cases even referred to.

2. The course of the argument strongly indicates that the court had no such purpose. The plaintiff’s intestate was killed at a crossing on defendant’s road, and the trial court refused to nonsuit on the ground that the plaintiff’s evidence failed to show freedom from contributory negligence. A judgment recovered in favor of the pdaintiff was affirmed at General Term, and this judgment the Court of Appeals reversed, holding that the evidence was insufficient to make the question of contributory negligence one of fact.

In view of the result, it is quite apparent that no change of rule was intended. The question of the desirability or propriety of a modification was not presented. t was not essential to the decision made that it should be passed upon or considered. What the court decided was that the plaintiff had not met the burden of proof resting upon her to show such facts as would authorize a jury to find that her intestate was free from contributory negligence.

This proposition the court attempted to, and did establish.

As a preliminary step in the argument by which that result was accomplished, the legal proposition for which the respondent contended, was conceded most strongly in his favor to the end that the (Strength of the argument should more fully appear. And discussing the evidence from that standpoint, the court reached the conclusion that the plaintiff should have been nonsuited because of her failure to prove such facts as would permit a jury to find absence of negligence on the part of the intestate.

Galwm v. The Mayor, which is as favorable to the appellant’s, contention as any case to be found in the books, presents no indications of an intent to change the rule of the cases we have cited. It neither discusses nor refers to them. The facts proved were dis•cussed by the court, and the comment made that “ many well-.grounded inferences are possible from the evidence.” After suggesting and considering some of them, the court concluded that part of the argument as follows: “ The inferences we have suggested were those which might reasonably have been deduced from the evidence by the jury, and we think it was error to take the case from it.”

My conclusion is, that the rule of the cases first cited still obtains .and justifies the decision of the trial court.

The judgment should be affirmed.

O’Brien, J., concurred.

Van Brunt, P. J.

(dissenting):

This action was brought to recover damages alleged to have been sustained by reason of the death of the plaintiff’s intestate. The defendant was at the time of the said death the owner of the premises No. 7 Cornelia street in the city of New York, which was occupied as a tenement house. On the 10th day of March, 1891, the deceased, the husband of the plaintiff, visited said building, and upon coming down stairs fell and was killed.

Evidence was given tending to show that some portion of these steps had been out of order for a considerable length that they were so at the time of the happening of the accident. Of this condition of affairs the housekeeper of the premises was notified, but they were not repaired. There was evidence also tending to show that the defendant, the landlord, was often at the house, being there almost every day collecting'his rents.

The only person who was a witness was ing the house as the deceased was coming down stairs, and saw him fall headlong to the bottom, where he was picked up dead. There was no evidence as to how the deceased was descending the stairs or what precautions he took in coming down. The witness who saw the accident testified that the deceased was about on the second step when he commenced to fall; and the evidence shows that the step which was more particularly out of repair at the head of the stairs was the third or fourth step.

In considering this testimony, however, it is to be observed the eye-witness evidently was not certain as to the exact location of the deceased upon the stairs when he commenced to fall; and the jury might have found as a fact that his fall commenced at the defective step.

At the conclusion of the plaintiff’s evidence the complaint upon the ground that there was no evidence that the want of repair of the step caused the fall of the deceased; and also that there was no evidence that he was free from contributory negligence.

In respect to the first proposition it seems to me that was evidence from which the jury might have found that the stairs in question were out of order at the time of the happening of the accident, and that as a result of such want of repair the deceased flipped and fell. It is impossible for the plaintiff, in a case of this description, to establish with absolute certainty the precise situation attending the happening of the accident. It is sufficient, however, if she places before the jury such a state of affairs that the jury would have a right to draw the inference that the accident was caused by the defective condition of the stairway ; and it is clear from the evidence in the case at bar that if such defective condition existed the jury might have been justified in finding it to have been the proxi- ' mate cause of the fall.

Upon the other ground upon which the complaint was dismissed, namely, that the plaintiff had not shown that the deceased was free from contributory negligence, it must bo admitted that there is no proof establishing this proposition; and if the rule of law laid down in Hart v. The Hudson River Bridge Company (84 N. Y. 62) is to be applied, the ruling of the learned court below was entirely correct. In that case the court charged the jury as follows: “ It is not enough to prove facts from which either the conclusion of negligence or the absence of negligence may be with equal fairness drawn, but the burden is upon the plaintiff to satisfy you that there was no contributory negligence on the part of the deceased.” The court held that there was no error in this charge, and that it was incumbent upon the plaintiff to satisfy the jury that there had been no contributory negligence by a preponderance of proof. And attention is called to the cases of Hale v. Smith (78 N. Y. 483); Warner v. N. Y. C. R. R. Co. (44 id. 471); Reynolds v. N. Y. C. & H. R. R. R. Co. (58 id. 248) and Cordell v. N. Y. C. & H. R. R. R. Co. (75 id. 330) as establishing the doctrine announced. I think, however, that all these cases upon this point have been overruled by a subsequent decision of the Court of Appeals. In Tolman v. Syracuse, Bing, & N. Y. R. R. Co. (98 N. Y. 203) an entirely different rule is laid down. In that case it is held that a case is made sufficient to go to the jury if the surrounding facts and circumstances reasonably indicate or tend to establish that the accident might have occurred without negligence of the deceased, in which case that inference becomes possible in addition to that which involves a careless or willful disregard of personal safety, and so a question of fact may arise to be solved by a jury and require a choice between possible but divergent inferences. In other words, upon an evenly balanced case, or where there is no evidence upon the subject of the happening of the accident, the jury have a right to find the affirmative fact that there has been no contributory negligence. The language of the court is: “ If * * * the surrounding facts and circumstances reasonably indicate or tend to establish that the accident might have occurred without negligence of the deceased, that inference becomes possible, in addition to that which involves a careless or willful disregard of personal safety, and so a question may arise to be solved by a jury.”

Therefore, the defendant must prove that the accident- could not-have occurred without negligence upon the part of the deceased, in order to prevent an affirmative inference establishing the want of contributory negligence, because in every case where the proof does not establish to the contrary, the accident may have occurred without the negligence of the plaintiff.

This rule seems to have been reiterated in the case of Galvin v. The Mayor (112 N. Y. 228), and as authority for the proposition announced in that case reference is had to the case of Johnson v. The Hudson River R. R. Co. (20 N. Y. 65). In that case (Galvin v. Mayor) there was no evidence as to how the accident happened,, and the court said : In an action for personal injury from negligence of the defendant, the absence of any fault on the part of the plaintiff may be inferred from the circumstances in connection with the ordinary habits, conduct and motives of men,” and that the character of the defendant’s negligence may be such as primafacie to prove the whole issue.”

The court further said: The proof did not show affirmatively a-want of care on the part of the deceased, and was quite consistent-with the exercise of due care and caution in approaching the grating”— a very different rule from that which is laid down in the case first cited. I think, therefore, that these cases have been distinctly overruled, and that in the absence of any proof whatever upon the question of contributory negligence, the jury may find that the plaintiff has established this affirmative issue in his favor, the only test being that such conclusion shall not be inconsistent with the facts proven although it may have no evidence to support it.

Applying this rule to the case at bar, there is no evidence whatever that the deceased did not use ordinary precautions in coming down the stairs, and, hence, the jury might have inferred that he was free from contributory negligence.

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

Judgment affirmed, with costs.


author: Parker, J. :

text:
    Thomas Adams & Company (Limited), Appellant, v. Nicholas Albert and Others, Respondents.

      Loan to a partnership — knowledge of misrepresentations, essential to an estoppel— confession of judgment in famor of a creditor without his knowledge.

    Where a person who had been a partner in a firm loans money to its successor,, he cannot he affected by representations made upon the part of the new firm, that the loan constitutes a part of its capital, unless knowledge of such representations comes to him.
    Where a son is justly indebted to his father for a loan, made to the son, but for the benefit of a firm in which the son is a partner, the fact that the son, without-the father’s knowledge, confesses judgment in favor of the father, does not in itself indicate fraud on the part of the father, and the father may stand on rights acquired upon an execution issued upon such a judgment.
    Appeal by the plaintiff, Thomas Adams & Company (Limited),, from a judgment of the Supreme Court in favor of the defendant Nicholas Albert, entered in the office of the clerk of the county of New York on the 18th day of February, 1895, upon the decision of the court rendered after a trial at the New York Special Term.

      W. W. MacFarland, for the appellant.

      James L. Bishop, for respondent Nicholas Albert.
   Parker, J. :

This is a suit in equity brought to procure an adjudication that a judgment recovered by the plaintiff against the defendant Henry C. Albert, December 29, 1893, for the sum of $39,480.32, and the levy and execution thereunder, be declared to be a lien upon certain goods belonging to the defendant Henry C. Albert, prior and superior to the judgment, execution and levy of the defendant Nicholas Albert, recovered December 23, 1893, for $51,445.

To prevent a sacrifice, incident to a sale of the goods at public auction, an agreement was entered into by which the goods were sold in the usual way, and the proceeds deposited in the Farmers’

Loan and Trust Company, such proceeds to be treated as a substitute for the goods, for the purpose of determining the rights of the parties.

The claim of the plaintiff upon the trial was and now is :

(1) That the sum for which Nicholas Albert obtained judgment was in fact part of the cajiital of the firm, and, therefore, subject to a lien in favor of firm creditors.

(2) That if it were not a part of the capital Nicholas Albert is estopped from asserting that it was not.

(3), That the evidence establishes a trust in favor of the plaintiff, arising ex maleficio, and an equitable lien in favor of the plaintiff superior to any right of Nicholas Albert.

Nicholas Albert came to this country in 1854. In 1867 he became a partner in the firm of Oscar De Lisle & Co. In December, 1872, that firm was dissolved, and a new partnership was formed to carry on the business, consisting of all the members of the old firm except De Lisle, and the firm name was changed to Albert, Haager & Walburger. During the existence of this firm Nicholas Albert resided in St. Gall, Switzerland, his duties as a member of the firm consisting in the purchase of goods to be shipped to New York for sale. That firm was dissolved December 31, 1885. The day following a new firm was organized, the members being Haager, Walburger and Henry C. Albert, a son of Nicholas. Nicholas Albert’s capital in the firm at the time of the dissolution was $115,385.96. Of that amount he loaned $50,000 to his son, to be employed in the business of the firm as Henry O.’s contribution to the firm’s capital.

Of the rest of his capital he left $50,000 with the firm. The plaintiff says lie left it as a part of the capital, while the defendant Nicholas Albert insists that it was a loan to the firm. Thereafter he received thereon from the firm interest at the rate of five per cent for three years, and afterwards at the rate of six per cent.

From time to time, as he needed it, he drew certain amounts from the firm, with the result that at the day of the entry of the judgment, December 23, 1893, there remained unpaid of the original -capital, plus a small amount of interest, over $51,000.

The learned judge at Special Term reached the conclusion that the only part of Nicholas Albert’s capital which found its way into the capital of the new firm was the sum of $50,000 which Nicholas loaned to his son Henry 0., in order to enable him to contribute towards the capital of the firm the sum agreed upon between him and his partners, the residue being a loan to the firm. The rule which should govern this court in reviewing findings of fact of a trial court clearly protects this finding from reversal. But we also think it should be said that, while there is evidence tending to support a contrary inference, after a careful examination of it we have reached the conclusion that the proper inference of fact was drawn. But, in view of the very full discussion had at Special Term, we do not feel justified in doing more than record our approval of the decision in such respect.

The next question is, whether Nicholas Albert was estopped from .asserting that the $50,000 for which he recovered judgment was not capital? TJnder this head two grounds of estoppel are assigned by the plaintiff. In the first place, it invokes the rule that where a man holds himself out as a partner, or allows others to do it, he is thereby properly estopped from denying the character of that which he has assumed, and upon the faith of which creditors may be presumed to have acted.

The appellant also' quotes from Parsons on Partnership, 495, the following: “If, therefore, this person, instead of permitting himself to be held out as a partner, permits his property to be held -out as the property of the firm, and as forming a part of the foundation on which its credit rests, the very same reason which held him personally in the first case, with all his property, would now hold that part of his property so permitted to appear as the property of the firm.”

The word permitted is used by the learned author in the sense of •allowed, suffered or acquiesced in. If a person loans money to a firm he of course cannot be affected by the representations of that firm to the effect that such loan constitutes a part of the capital of the firm if knowledge of such representations does not come to him.

Aside from a conversation had with a representative of the plaintiff, Mr. Carver, to which reference will be made under the second head, we are unable to find any evidence in this record that Nicholas Albert knew, or had reason to believe, that the money due to him was held out by any one as constituting a part of the property or capital of the firm. He never saw the books of the new firm of which his son was a member, and it appears from his testimony, which is uncontradicted in such respect, that he never asked for an account or statement of tlie business of the firm and never received one. Nowhere in this record can we find any evidence pointing in the direction of either knowledge or suspicion on the part of Nicholas Albert that the $50,000 which he says he loaned to the firm was held out by them, or any one of them, as a part of the capital of the firm.

The appellant further insists that the representations made by Nicholas Albert to a representative of the defendant about the 15th of July, 1891, upon which plaintiff relied and subsequently acted, brings into operation another rule of estoppel, to wit, that where a man makes a representation to another which he intends shall affect his action, and the representations are of such a character as a man would take to be true and he believes that it was intended that he should act upon it, and does so act, the party making the representations is precluded from contesting their truth. (Continental Nat. Bank v. National Bank, etc., 50 N. Y. 575.)

About the 15th of July, 1891, the firm of Albert & Haáger was indebted to this plaintiff in the sum of about $45,000 for goods sold and delivered to it. A Mr. Carver, the manager of the plaintiff, called upon Mr. Henry C. Albert, who was at that time at St. Grail, Switzerland, for some assurances touching the condition of the affairs of the firm of which he was a member. Later in the day he called upon Mr. Nicholas Albert at his residence, and liad an interview with him in the presence of Henry C. Albert. The court finds that the statement made to Mr. Carver by Nicholas Albert at that interview was as follows : “ You need not have any fear at all. That is all right. Your firm wont lose anything, because as much as I know, the business over there is good, and I have over $100,000 capital in the business; $50,000 as a loan to my son, and the remaining part to the firm, so you need not be afraid at all; that is all right.” Had Nicholas Albert concluded his representations with the statement “ I have over $100,000 capital in the business,” it might be urged that it was reasonable -for Mr. Carver to have inferred from that statement that Nicholas had $100,000 in the capital of the firm, but that phrase constituted only a part of a sentence, which, when completed, makes it entirely clear that he intended to give no such assurances, but, on the contrary, intended that Mr.. Carver should understand what the fact was, to wit, that $100,000 of his original capital was employed in the business, $50,000 of it-having become the capital of his son, and the other $50,000 being’ loaned to the firm. This expresses the exact situation and was not-calculated to mislead an ordinarily prudent man. As to so much of the statement as we have quoted, there is no substantial dispute, but Carver claims that Nicholas Albert further said that in the event of the non-renewal of the contract of partnership between Haager and his son, which was to expire by limitation on the thirty-first of December following, his money would not be withdrawn until plaintiff’s claim should be paid, and that it was understood between the parties at that interview that Nicholas Albert’s statement should, be reduced to writing and presented to Carver, which Carver says-was done. Nicholas Albert positively denies that at that conversation any such assurances as that were given, or that there was any understanding that the conversation should be reduced to writing,, and further that he never heard of the existence of any such writing until after the commencement of this action.

The judge, at Special Term, credited this statement, and we see-no reason to differ with him. The son did write and deliver to Mr.Carver a statement which reads as follows :

“ St. Gall, July 16th, ’91.
Mr. Carver :
“Dear Sir — Referring to our conversation of to-day, and wishing to - set your miud entirely at ease conc’g our indebtedness to-your firm, I wish to say that my father has a capital of about one-hundred thousand dollars in the business, half of which is at the-bus. risk and balance loaned to me, and that in the event of non-renew;al of contract between Mr. Haager and myself, you can rest assured of being paid in full before withdrawal of said capital.
“ Sincerely yours,
“H. O. ALBERT.”

It will be observed that this'statement purports on its face only to-be an assurance of Henry C. Albert on his own behalf. It refers to a conversation had with Mr. Carver on that day, and it ajipearsbeyond controversy that he did have a conversation with Carver-prior to the meeting between Carver, his father and himself. The form of the statement, the fact of the previous interview between. Iiemy O. Albert and Carver, the testimony of Henry C. Albert tliat it was written by him and delivered to Carver before the meeting of the three at Nicholas Albert’s house, and the circumstances .attending its writing, together with the testimony of Nicholas Albert that he never authorized any such statement and did not know of it until after the commencement of this action, were sufficient to justify the trial court, in believing as it did that Nicholas Albert was not a party to the statement in any manner whatever.

That being so, it is entirely unnecessary to consider how the state*ment would have affected the rights of the parties had it been made upon the authority of Nicholas Albert.

We shall not discuss the proposition that the fund in question is subject to a trust in favor of the plaintiff arising ex maleficio, further than to say that there is no substantial basis for it in the evidence. The $45,000 which was owing the plaintiff by the firm of Albert & Haager, in July, 1891, was paid, but other indebtedness was contracted from time to time during the year and a half following by the firm of Albert & Haager, or Albert individually, so that there was due plaintiff, at the time it obtained judgment in December, 1893, something over $30,000. But there was no fraudulent conduct on the part of Nicholas Albert; he trusted his son fully down to the last moment; the $50,000 which Nicholas loaned him to put in the business has disappeared in losses; it is not pretended that he has even received any part of the $100,000, of which half was loaned to the firm and half to the son, or that it is possible for him to receive anything on account of that indebtedness other than the money in the Farmers’ Loan and Trust Company, which is the subject of this controversy.

It is true that the son confessed judgment in favor of his father without his father’s having knowledge that he intended doing so, or that there was any occasion for it; but surely that does not tend to show wrongdoing on the part of Nicholas Albert; and wo find nothing in the record which indicates to us that he intended at any time to deceive or wrong any one, or that he had any suspicion even that the business was insolvent. Finding a judgment in his favor for a debt lawfully due, an execution issued thereon and a levy thereunder, he stands upon the rights thus acquired to secure to him the little that is left of what he once regarded as a substantial fortune. This lie may do if be cliooses, inasmuch as it does not appear that his judgment debtor confessed the judgment as a part of a fraudulent scheme to cheat and defraud his creditors, or that the father was guilty of any act which in' equity should deprive"him of the rights of an ordinary judgment creditor.

The judgment should be affirmed, with costs.

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

Judgment affirmed, with costs.


text:
    Annie Bryant, as Executrix, etc., of William E. Bryant, Deceased, Respondent, v. Jacob A. Ondrak, Appellant, Impleaded with Others.

      Oral agreement — not binding, when it is to he embodied in a written one.

    The fact, that parties negotiating for the purchase and sale of personal property decide to have a formal written agreement executed, is strong evidence that the prior oral agreement was not understood or intended to he binding.
    Appeal by the defendant, Jacob A. Ondrab, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 12th day of November, 1894, upon* the verdict of a jury rendered after a trial at the New York Circuit, and also from an order entered in said clerk’s office on the 12th day of November, 1894, denying the defendant’s motion for a new trial made upon the minutes.

      Charles M. Demond, for the appellant.

      Albert H. Atterbury, for the respondent.
   Parker, J. :

We shall only discuss one of the several questions brought to our attention by the appellant, because the conclusion we have reached in respect to it calls for a reversal of the judgment.

We think the plaintiff failed to establish the contract upon which recovery was sought, and, therefore, the defendant’s motion to dismiss the complaint should have been granted. The preliminary facts, essential to an understanding of the situation which led up to tlie meeting of tlie parties, which the plaintiff alleges resulted in the making of the agreement sued on, are as follows :

Prior to February 25, 1894, the defendant Jacob A. Ondrak and tlie plaintiff’s testator, William E. Bryant, were partners in business .as ladies’ tailors at No. 314 Fifth avenue, New York city. They had a written partnership agreement which provided that in the .event of the death of either partner the survivor might carry on the business for six months succeeding the first of January or July next .ensuing and have two. months thereafter to close up the business. On the date above named William E. Bryant died, leaving him surviving a widow, this plaintiff, and six adult children who were joined as defendants. By his will he gave all of his property to his widow, whom he appointed executrix.

The will was not proved until April 23,1894, letters testamentary •thereon being issued to the plaintiff on the day following. About .a week after the death of Bryant, Ondrak told Miss Kate Bryant, a daughter of the deceased, and who had been for a long time in the employ of the firm, that he would purchase her father’s interest in the business forthwith and suggested an appraisal to that end. Over a month before the will was proved, and without any knowledge on the part of Mr. Ondrak of its contents, and on March 13, 1894, Mr. Ondrak with his appraiser, John S. Wetherley, and his lawyer, Charles S. Hayes, met Miss Bryant, representing her mother, the plaintiff, and her brothers and sisters, together with her appraiser, .Jonas IT.' Monlieimer, and her lawyer, Boudinot Keith, at the store. The fixtures, stock, book accounts and good will were appraised .separately, and after a discussion of several hours, in which all of the parties present, including the appraisers and lawyers, took part, the terms of the agreement were, as the parties seem to have supposed arrived at, by which Ondrak was to pay $11,000 for the •interest of his deceased partner, including the good will of the business. The agreement was to be reduced to writing, and the •fixtures, stock, book accounts and good will to be assured to him by the execution of the. agreement by the widow and six children. After discussing the various questions which were presented and .-arriving, as the parties supposed, at the terms of the agreement, one or both of the lawyers were instructed to prepare a written contract for execution. For some reason the contract was not at once prepared, and the day following Miss Bryant called upon the defendant and informed him that they were in need of ready money for the payment of funeral and other expenses and so he advanced to her the sum of $2,500. Ondrak’s lawyer, who insists that it was the understanding that he was to prepare the contract, a few days after the meeting of the parties prepared and sent to Mr. Keith, the attorney for the Bryants, a proposed agreement to be signed by Mrs. Bryant and the children. It was not acceptable and the Bryants refused to sign it, asserting that it embraced matters not included in the oral arrangement, although it appears from the testimony of Ondrak and his lawyer to have been actually in conformity therewith as they understood' it. Mr. Keith then submitted a proposed agreement to be signed by Mrs. Bryant, and a supplemental agreement to be signed by the children as an estoppel, but they were never signed, and Miss Bryant, who alone represented the Bryants’ interest on the thirteenth of March, upon her examination in relation to said contracts, was asked this question, “ But you were not willing that you and your brothers and sisters should sign the agreement that your counsel had prepared 2” Tb which she replied, “No; not to sign any agreement.” Ondrak’s lawyer subsequently proposed a modification of the proposed agreement prepared by Mr. Keith, and also made some changes in the draft of the one which he had submitted, but neither of them proved acceptable to Miss Bryant, and the attempt to prepare a written contract which should meet with the approval of all the parties was then abandoned by both lawyers. The main point of difference between the parties seems to have related to the manner by which the good will which it was conceded Ondrak was to have and was to pay for, should be assured to him. But the negotiations did not stop with the failure to agree upon a writing which should express the understanding of the parties. Mr. Atterbury, who had formerly been the attorney for the Bryants, on his return from Europe early in April following, undertook to adjust the difficulties between the parties. As he testifies, he attempted to bring about some compromise, and for that purpose met Miss Bryant and Mr. Ondrak with his counsel, Mr. Hayes. In the course of this interview Mr. Atterbury suggested tentatively, as he expresses it, a new appraisement, conveying at the same time an intimation that, as a result of it, Mr. Ondrak might be obliged to pay more money. He also intimated that it might be proper to have a receiver appointed as a last resort, although one of the things that he was most anxious to avoid. On another occasion Ondrak was asked by Miss Bryant’s counsel, in her behalf, what lie would take to sell out. Without further detailing the various conversations between the parties and the attempts to adjust matters in controversy, it is sufficient for present purposes to say, that they continued all through the month of April. But about the first of May plaintiff’s counsel apparently reached the conclusion that, notwithstanding it was a part of the original arrangement that the terms of the agreement should be reduced to writing and signed by all of the Bryants, the failure of the Bryants to execute an agreement embodying its terms even as they claimed to have understood them to be, and the various other negotiations and propositions looking to a settlement and adjustment of the differences between the parties, they could treat the conversations between the parties, of March thirteenth, as resulting in a completed contract and recover the price agreed on. If it were a completed contract the position taken was correct. But it seems to us very clear that the contract was not completed. That as a matter of fact the minds of the parties never met upon the terms of the agreement. This appears from the dispute which the parties had over the terms of the proposed written contracts, to which we have already paid sufficient attention. There is other and conclusive evidence that the minds of the parties did not meet, either as to the nature of the agreement affecting the transfer of the good will of the business to Ondrak, or as to the persons who were to be parties to it. But to that we shall refer later. Did the parties to this alleged oral agreement understand that the contract was so far completed that nothing more needed to be done in the premises ? It would seem not for several reasons.

(1) They provided that a written agreement should be prepared and executed. The authorities have always recognized, that the circumstance that the parties decided to have a formal written agreement, is strong evidence that the oral agreement was not understood or intended to be binding. (1 Whart. on Cont. § 5; Pollock on Cont. [3d ed.] 41; Brown v. N. Y. C. R. R. Co., 44 N. Y. 79-86.)

(2) Again, Ondrak was attempting to make an arrangement with all the Bryants, and. this could only be accomplished by having them parties to an agreement in some form. They were not present, and Miss Bryant neither produced nor pretended to have any written authority to act for them, and under such circumstances -it is hardly to be presumed that his attorney would advise that he would be sufficiently protected as against all of them by her assurances.

That Ondrak understood that he was to have the agreement of all the Bryants, not of the plaintiff alone, is evidenced not only by the fact that he did not have knowledge of the contents of the will, but-by his conduct and language and that of his counsel at the time of the negotiations. The testimony of Keith, the counsel for the Bryants on that occasion, sufficiently establishes that fact.

He said : I think Mr. Hayes (Ondrak’s counsel) said, I hand you. this dollar on behalf of Mr. Ondrak as representing yourself, your brothers, your sisters and your mother • — • to you on behalf of your mother and brothers and sisters.” It was not pretended at that time, nor was it on the trial, that Miss Bryant had been authorized by her mother or her brothers and sisters to sign for them any contract to which she and Ondrak might agree.

Necessarily, therefore, it could not have been intended that Ondrak should be bound before the other parties, which was intended to be provided for by the execution of the agreement which all understood was to be prepared by one or both of the lawyers.

(3) The minds of the parties did not meet. This not only appears from their subsequent conduct over the several proposed agreements, and the efforts for compromise on other lines than that expressed in the writings prepared by the attorneys, but it appears from the testimony of the parties. The testimony of Ondrak and his counsel, Hayes, shows that they understood that the agreement which Ondrak was to have was not to be from Mrs. Bryant, but from her and all of the children.

From Ondrak’s standpoint there were two reasons for it: First, he had no knowledge of the disposition which Bryant had made of the property; and, second, two of the Bryant children were experts in the business, and one of them had been for a long time employed in the store under the name of Miss Williams. He was desirous, therefore, of securing such an agreement as would cover all the Bryants’ interest in the first place, and in the second to assure to him the good will of the business beyond doubt. This he may well have supposed might not be fully accomplished, if two experts in the business by the name of Bryant should be in no way obligated to him. Not only is the appellant’s testimony corroborated by his counsel, and by the reasons we have suggested, but it is fully supported by the testimony of Keith, counsel for the Bryants, in the quotation which we have already taken from his testimony, which purports to give what Mr. Hayes said to Miss Bryant when he handed her the dollar. **

But Miss Bryant testifies that the understanding was not that all of her brothers and sisters, as well as her mother, were to sign the agreement, but that they were to sign a writing consenting that their mother should sign the agreement with Ondrak. It may well be that that was her understanding of the terms of the agreement, but it certainly was not the understanding of the other parties. The-'difference between them was substantially as we have observed, ;and it operated to prevent them from uniting in the written agreement, which all of the parties understood should contain a full and complete expression of the terms and conditions of their arrangement. Other facts might be cited in support of the position we have taken, but we think enough has been said to make it reasonsonably clear that the defendant Ondrak was entitled to a dismissal of the complaint upon the ground that the plaintiff had not established the contract alleged' in her complaint.

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

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

Judgment reversed, new trial granted, costs to appellant to abide event.


author: Ingraham, J.:

text:
    Frances Nathan and Others, Respondents, v. Edmund Hendricks and Others, Respondents. Morris B. Baer, Appellant.

      Marketable title — will — contingent remainder — when it rests.

    The court will not compela purchaser of real estate at a judicial sale to complete his purchase, unless the title furnished to him is free from reasonable doubt and he will acquire by the purchase a marketable title to the property in question.
    The will of a testatrix provided that, in case her daughter Matilda should survive her daughter Emeline, and the latter should die without issue, the rents and profits of certain real and personal estate held in trust for Emeline should be applied to the support of Matilda during life, and after her decease the trustees were directed to convey the real and personal estate to the children and lawful heirs of the deceased brother of the testatrix, share and share alike, per stirpes. Emeline died without issue and before Matilda. An action was brought to partition the property, and only the descendants of the deceased brother of the testatrix who survived Matilda and Emeline were made parties. The purchaser at the sale in partition refused to complete his purchase.

      Meld, that the children of the testatrix’s brother did not take a vested remainder as of the death of the testatrix;
    That the bequest was contingent upon Bmeline’s dying without issue;
    That, as upon her death the trustees were to hold the property in trust for Matilda, the fee thereafter vested in the trustees until her death and then first became a vested remainder in the heirs of the testatrix’s brother, who were such at that time.
    Appeal by Morris B. Baer, purchaser, from an order of the 'Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 28th day of May, 1895, denying his motion to be relieved from his purchase of premises sold pursuant to an interlocutory judgment of partition and sale.
    The action was brought for the partition of certain real property devised by the will of Charlotte Gomez, the fourth clause of which was as follows:
    “ Fourthly. In case my said daughter Matilda should survive her sister Emeline, my said daughter Emeline dying and leaving no child or children or their issue descendants of her body her surviving, I bequeath and devise the real and personal property herein-before devised and bequeathed to be held in trust for my said daughter Emeline by my said executors to my said executors to be held in trust to apply the rents, income, dividends and profits of all and singular the same to the support, maintenance, wants and necessities of my said daughter Matilda during her natural life, and after her decease to transfer, convey and set over all and singular the same, my real and personal estate, so left in trust, to the child”en and lawful heirs of my brother Harmon Hendricks, deceased, to share and share alike, per stirpes / saving and reserving, however, both from this last bequest and devise in trust for the use of my daughter Matilda and the children and heirs of my brother Harmon Hendricks, in case my daughter Emeline should by her last will or other lawful direction dispose of the sum of $5,000 to be paid out of my said estate so held in trust after the decease of my said daughter Emeline to such person or persons as she may deem proper.”
    The objections of the purchaser were as follows :
    “ The said testatrix left her surviving the two children named in the will, viz.:
    “ (1) Emeline Gomez (who subsequently married one Adolphus), and who died intestate on March 20, 1885, without issue.
    “ (2) Hetty Matilda Gomez (called ‘ Matilda ’ in the will), who was then and continued of unsound mind and died intestate December 6, 1893,-without issue and unmarried.
    “ The plaintiffs have joined as parties to this action only those persons who, at the death of Hetty Matilda Gomez on the 6th day of December, 1893, answered to the description of the then living heirs of Harmon Hendricks named in the will as brother to the testatrix.

      “ Said Harmon Hendricks had died previous to the time when said Charlotte Gomez made her said will; he left him surviving ten children, to wit: Hetty Hendricks Gomez, Uriah Hendricks, Henry Hendricks, Washington Hendricks, Montague Hendricks, Emily G. Hendricks, Hannah Hendricks, Eosalie Tobias, Hermoine Tobias and Selina Hendricks, all of whom also survived the said Charlotte Gomez.
    “ The said ten children of Harmon Hendricks have since died (all of them dying before March 20, 1885), and their several residuary devisees, that is to say, the United States Trust Company of New York, as trustee under the will of Emily G. Nathan, and others, whose names your petitioner is unable at present to specify, who took the interest in the said premises No. 27 Mercer street, which was vested severally in said ten children, are not parties to this action.

      “ Nor have the plaintiffs joined as parties hereto the devisees of descendants of Harmon Hendricks who were living at the death of Emeline Gomez (Adolphus), on March 20, 1885, and who died prior to the death of Hetty Matilda Gomez on December 6, 1893.”

      Townsend Wandell and Thomas W. Butts, for the appellant.

      Edgar J. Nathan, for the plaintiffs, respondents.
    Present — Van Brunt, P. J., O’Brien and Follett, JJ.
    Order affirmed, with costs, on opinion of the court below.
   The opinion of the court below was as follows:

Ingraham, J.:

I fully appreciate the strength of the purchaser’s position — that the court should never compel a purchaser of real estate at a judicial sale to complete his purchase unless the title furnished to him is one free from reasonable doubt, so that he can get a marketable title. But, as this question is purely a legal one which depends upon the construction of the will under which the parties to this action claim, it seems to me that it would be for the interests of both parties to have the title settled on this motion.

The only question involved is whether or not the defendants, being the descendants and lawful heirs of the testatrix’s brother, Harmon Hendricks, took a vested remainder in the real estate described in the fourth clause of the will, so that it passed to their devisees or heirs at law, or whether the remainder was contingent, to be divided among the lawful heirs of Harmon Hendricks at the time of the determination of the life estate.

There is a general rule in this State which is well settled that where “ the only gift is in the direction to pay or distribute at a future time, the case is not to be ranked with those in which the payment or distribution only is deferred, but is one in which time is of the essence of the gift. * * * In such cases, until the happening of the future event, it must necessarily remain uncertain whether a gift would exist at all, and that could not be said to have vested which was not certainly given.” (Smith v. Edwards, 88 N. Y. 104.) In Goebel v. Wolf (113 id. 412) the rule is stated as follows : “ In harmony with this general rule another general proposition has been form ulated, that, where the only gift is found in a direction to divide at a future .time, the gift is future and not immediate ; contingent and not vested.” ,

The case of Delaney v. McCormack (88 N. Y. 174) is in point. There the testator gave his real estate to his son for life, and in fee in case his son married and had issue. If his son died without lawful issue, the will directed the executors to sell the real estate and distribute the proceeds among the testator’s next of kin. It was-held that the proceeds of the real estate were to be distributed among those who were such at the time of the distribution and that-the devise was contingent. In this case the real estate was devised to the trustees to receive the rents, income and profits and pay the-same to her daughter Emeline, and in case she should die leaving lawful issue, then to grant and convey the said real and personal estate to such issue. The bequest was, therefore, contingent upon Emeline dying without issue. Emeline lived until 1885, and then died without issue. Matilda survived her and died in 1893. It is-clear that during Emeline’s life the devise was contingent. It was uncertain whether or not the land would go to her issue, and what was said by Finch, J. (Delaney v. McCormack, supra), applies to this case: “ Here a future condition or contingency attached to the substance of the gift. It was conditioned upon the death of James(Emeline) without having had lawful issue, so that the vesting was plainly postponed and the gift was future.” Upon the death of Emeline without issue the trustees were to hold the property in trust for Matilda, and upon Matilda’s death they were to convey and set-over said property to the children and lawful heirs of the testatrix’s-brother. There are here no words of gift to the heirs of Harmon.. On the contrary, the whole fee is vested in the trustees, and the only provision is that after the death of Matilda they are to transfer, con- and set over all the real and personal estate so left in trust to the children and lawful heirs to the testatrix’s brother Harmon Hendricks.

I think that under this provision of the will the remainder was-contingent and did not vest until the termination of the life estate. I think, therefore, the motion should he denied. The question,, however, is not free from doubt, and under the circumstances I will grant a stay of proceedings pending appeal to the General Term, so-that the quéstion can be passed upon at the General Term during the June term.


author: Patterson, J.:

text:
    National Park Bank of New York, Appellant and Respondent, v. Warren N. Goddard and Others, Respondents and Appellants.

      Sale induced by fraud — levy upon the goods by a creditor of the vendee — when replevinwill not lie — equitable remedy of the defrauded vendor — confusion of goods.

    Where the sale and delivery of goods has been induced by fraud, but the vendor has not rescinded the sale, the vendee has a leviable interest in the goods which can be taken by the sheriff under attachment. When so taken by the sheriff the goods are in the custody of the law, and an action of replevin upon the part of the defrauded vendor does not lie. The amendment to section 1690 of the Code of Civil Procedure, made by chapter 305 of the Laws of 1894,. changing this rule and in effect permitting an action of replevin in such a case, has no retroactive effect.
    Where the plaintiff in an attachment suit brings an action in equity to procure an adjudication as to the rights of various claimants to a fund realized from the sale of the property in dispute and in the hands of a receiver of the court, the rules of equity govern the decision of the case.
    In this view, replevin actions brought by defrauded vendors, and their demands for their property from the sheriff, constitute a rescission, displace the lien of the sheriff in favor of their original title, and give them an equitable title which the court will enforce.
    Where, however, the articles in question are manufactured garments, and the claim of the vendors is only for the merchandise which entered into the manufacture, the court will protect the vendors only to the extent of the value of the merchandise.
    Where the lights of innocent third parties intervene the usual rule as to confusion of goods will not be applied, and an attempt will be made to protect all who have an interest in the subject-matter.
    Appeal by tlie defendants, Warren N. Goddard and others, from a judgment of the Supreme Court determining the rights of numerous parties to a fund in the hands of a receiver, entered in the office of the clerk of the county of New York on the 4th day of January, 1895, upon the decision of the court rendered after a trial at the New York Special Term, and also an appeal by the plaintiff from the whole of said judgment, except that part which adjudges and decrees “ that the defendants, and each of them, their agents and attorneys, and the coroners of the city and county of New York, be, and they hereby are, restrained and enjoined from prosecuting the actions against the sheriff of the city and county of New York brought by said defendants respectively, as alleged in the complaint herein, and from further enforcing, or seeking to enforce, the requisitions to replevin issued in said actions.”

      Barlow do Murray, for the plaintiff.

      Abrahann Gruber and Louis Marshall, for the defendants.
    Judgment affirmed with costs, on the opinion of the court below.
    Present- — -Van Brunt, P. J., Follett and Parker, JJ.
   The opinion of the court at Special Term was as follows:

Patterson, J.:

By the agreed statement, setting forth all the facts to be considered by the court in deciding this cause, it appears that the plaintiff sues to obtain an adjudication of the rights of various claimants to a fund now' in the hands of a receiver of this court, which fund consists of the proceeds of certain manufactured garments which were sold by the receiver under an order of the court. Yarious claims to the goods were urged by many parties, among them the plaintiff and such of the defendants as are now before the court, and whose names appear in the statement referred to. The plaintiff claims under an attachment, judgment and execution against the property of Levy Brothers. The defendants now before the court claim by title revested in them to goods sold and delivered by them to Levy Brothers, the sales having been procured to be made by fraudulent representations of Lev} Brothers, and the defendants having rescinded the sales and elected to treat them as null. It also .appears that the sheriff of the city of New York levied upon the property which the defendants had sold to Levy Brothers, such levy being under the attachment in the plaintiff’s action against that firm. This levy under the attachment was made before the defendants elected to rescind the sales. While the goods were in the sheriff’s possession under the attachment, the defendants brought actions of replevin and issued process to the coroner, who seized the manufactured goods for the making of which in part the defendants’ merchandise had been used. There were altogether some fifty actions of replevin brought, and, thereupon, this suit was instituted for the express purpose of having an adjudication by this court as to the rights of the parties to all those actions in and to the goods. Interlocutory proceedings were had in this action, by which the receiver of the merchandise was appointed, and .lie was instructed -to sell the property and to hold the proceeds subject to the order of the court. The actions in replevin were enjoined, and the various defendants have come into court with their answers setting up their claims and insisting upon their rights to the fund, the subject of the litigation. It further appears by the agreed statement of facts that -the goods sold by the defendants to Levy Brothers were made up, with other goods, into garments, and the defendants now urge that by reason of the changed form into which their merchandise has heen put, and the impossibility of separating that merchandise from the garments without destroying its value, they are entitled to the proceeds of sale of all the goods on the principle which applies to cases of accretion and confusion of property. In passing upon these claims, it is apparent at the outset that when the attachment issued in the plaintiff's action against Levy Brothers the defendants in that action had an interest in all the merchandise which could be levied upon and held by the sheriff, and also that, as the property was situated at the time the defendants’ replevin actions were begun, it then being in the custody of the sheriff and hence in the Custody of the law, those actions of replevin were not maintainable, and possession of the goods could not be lawfully obtained by the defendants under the replevin suit. (Wise v. Grant, 140 N. Y. 593.)

As the matter stood, therefore, when the actions in replevin were 'begun, which was subsequent to the levy under the attachment, the sheriff had a lien upon the merchandise, and the plaintiffs in the replevin actions could not recover the goods. But, notwithstanding that condition of things, when the defendants now before the court elected to rescind the sales, as they did by their demands on the sheriff, and the institution of replevin actions (Moller v. Tuska, 87 N. Y. 166 ; Powers v. Benedict, 88 id. 605), the lien of the sheriff was displaced in favor of the original title of the sellers of the .goods, so that when the present action was begun this plaintiff and the defendants now claiming were standing before the court, the former on an alleged right as a lienor creditor, the latter with a title revested in them to the merchandise, but prohibited from taking possession by reason of the statute, which, in consequence only of the particular situation of the property, deprived them of the sub- stantial right to reduce it to actual possession. These are the claims and that is the condition in which they come before the court, and they must be regarded with reference toothe equitable rights of the parties, for it is exactly the aspect in which the plaintiff, by bringing this suit, has chosen to put the matter, and in which it asks the judgment of the court; it seems to me, therefore, that the question of legal right to possession as predicated only ujDon the defendants’ claims under the actions of replevin is not to control in the disposition of the cause, and that although the actions of replevin were not maintainable, and the property could not be taken from the possession of the sheriff in actions of replevin, yet as the lien of the sheriff was displaced by the rescission, and the title was revested by the act of rescission, the defendants have shown an equitable title which can be protected and enforced in this action, for that would seem to be the necessary effect of the extinction of whatever lien existed in favor of the plaintiff by reason of the sheriff’s possession, so that, although these actions of replevin were futiíe as remedies, they, nevertheless, were effectual as evidences of the intent and determination on the part of the defendants to-rescind. the contracts of sale, and for the purpose of the restoration of title to the goods to themselves. It seems-to me they, therefore, stand as having paramount claims in a court of equity to their particular goods, and consequently to their proceeds now in the custody of the officer of the court. This follows from their being the real owners of the goods, and while, under ordinary circumstances, the sheriff would not be enjoined from proceeding under an execution, yet the plaintiff having brought the-whole controversy into court it may be disposed of as justice and equity dictate.

It is claimed, however, by the learned counsel for the plaintiff' that the only remedy open to the defendants upon the state of facts-disclosed by the submitted record was in trover against the sheriff. That such action would lie I think is clear, and I also concur in the argument that nothing in the pleadings in this cause, or in any of the papers now before the court, can turn the defendants’ claims into technical actions of conversions against the sheriff or the plaintiff. But I appehend that the subject-matter of this action does not come before the court upon a question of pleading, nor are these claims to be disposed of otherwise than according to the equities as they appear by the concession of all the respective parties. They have-been brought before the court by the act of the plaintiff in instituting the suit, and in so doing it has shown that the lien of its process-upon the goods has been superseded, and it has also shown that-the clear title of the defendants to their goods has been restored, and it would be unjust for the plaintiff to insist that the defendants-should be deprived of their equitable rights when the plaintiff itself has no superior equitable claim to have the proceeds of the goods-applied to the payment, of its debt. A court of equity will not aid in applying the property of a third party to the payment of a debt-of a stranger, and while the defendants gain nothing by their replevin, suits they may stand here on their ownership.

But while I am of the opinion, upon all the facts, that the defendants are entitled to protection, it can only be granted to the extent of the value of their merchandise which entered into the-manufacture of the garments sold. It is true that the general rule of law respecting the accretion and confusion of property is that, as between an innocent party and a wrongdoer, where the property of the former has been mingled with, and cannot be separated from, that of the latter, the whole bulk shall be adjudged to the former,, and it is a rule of strict application between the parties to the transaction. But where the interests of other persons intervene,, and full protection can otherwise be given to the innocent person whose goods are thus wrongfully used, the rule should not be-applied. The other parties in this case are the creditors of Levy Brothers. It is sufficient for the indemnity and protection of the defendants in this cause that so much of the proceeds of the goods-be adjudged to them as is equal to the price at which they sold the goods to Levy Brothers, and interest, and to that extent a decree will be directed in their favor.

Before dismissing the subject it is proper to consider a contention made by the defendants, that notwithstanding the general rule com cerning the right to maintain replevin, as laid' down in the Wise case, a particular rule of decision has been made in this case recognizing the validity of the actions brought by these defendants-against the sheriff, and that, therefore, the defendants have a legal as well as equitable claim to relief. This contention is based upon certain interlocutory or collateral proceedings which were had in this case concerning a title to piece or unmanufactured goods, which by the consent of the plaintiff were restored to the defendants. I do not think any of these proceedings should be regarded as a final adjudication of the question as to the defendants’ right to the possession of all the goods manufactured, as well as unmanufactured.

It is quite apparent from an inspection of these papers that it was the intention of the parties and of the court in making its orders upon the subject, to separate the two classes of goods, and, while the right of possession of the goods released from the suit was recognized, it is expressly provided that tlie^ proceeds of other goods (and that refers to the manufactured articles) should be brought into court to await its final order. The clear inference from this is that neither of the parties contemplated that any estoppel should arise by reason of this merely interlocutory proceeding. This question was raised as one of evidence, and is disposed of on the record by the rejection of the documentary evidence which was offered to sustain this claim of an estoppel by adjudication.

One other question was discussed to which reference should be made, and that is the claim of the learned counsel for the defendants, that, by the amendment of the Code of Civil Procedure, chapter 305 of the Laws of 1894, modifying the provisions of section 1690, the decision in the case of Wise v. Grant has become nullified, and that this amendment has a retroactive operation and consequently affects this case, so that the actions of replevin, although untenable when brought, have become established'by virtue of this subsequent legislation. I do not consider this amendment as having any retrospective effect, nor do I think the intention is to be attributed to the Legislature of enacting a new rule of law to control a pending cause, for such a construction would be to confer a right of possession, which is a substantial legal right, as contra-distinguished from a mere remedy, and which right had no existence at the time replevin suits were brought. The defendants’ rights are purely equitable and they are considered and recognized only in that light.

A decree in accordance with those views may be entered, to be prepared by the attorney for the defendants, and to be settled on two days’ notice.