text:
    Lafayette E. Pruyne, as Trustee, etc., Respondent, v. The Adams Furniture and Manufacturing Company (Limited) and Others, Defendants; Martha A. Sinclair and The Citizens’ National Bank of Adams, N. Y., Appellants.

      Corporation — form of a certificate of acknowledgment by — surrender for a special purpose of bonds secured by a mortgage — ■mortgage not discharged thereby.

    It is the policy of the law to uphold a certificate of the acknowledgment of an instrument by a corporation when substance is found in the certificate, and it should be the aim of courts, in cases of defective certificates, to preserve and not to destroy their efficiency.
    There is no particular form required by statute for the acknowledgment of an instrument, when such acknowledgment is made by a corporation.
    In an action brought to foreclose a mortgage given by a corporation to a trustee to secure bonds, it appeared that when the mortgage was given the capital Stock of the corporation was §20,000; that bonds were issued under the mortgage, and were sold at par to the stockholders of the company; that thereafter the company went into the hands of a receiver, and subsequently the capital stock was increased to §40,000, and the bonds, in pursuance of a, resolution of the board of directors, were exchanged for stock of the corporation, and were surrendered for the purpose of being guaranteed by individual stockholders, and then being sold to third persons for the purpose of raising money, which was done under the express understanding and agreement that the bonds when surrendered were not to be canceled, but were tobe reissued.

      Held, that there was no merger," and-that the mortgage was not satisfied by the surrender of the bonds.
    Appeal by the defendants, Martha A. Sinclair and another, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Jefferson on the 21st day of June, 1895, upon the decision of the court rendered after a trial at the Jefferson Special Term.
    The action was brought to foreclose a mortgage or trust deed executed by The Adams Furniture, and Manufacturing Company (Limited) to the plaintiff. It was dated the 15th day of August, 1889, recorded on the twenty-eighth of the same month, and given to secure thirty-six bonds of $500 each, payable on the 15th day of August, 1899, with semi-annual interest, payable on the fifteenth day of February and August of each year. It was given pursuant to the consent of the stockholders and a resolution passed at a meeting of the directors of the corporation. It was attested : “ In Witness Whereof, the party of the first part has caused its corporate seal to be affixed hereto, and these presents to be subscribed by its president and secretary, and by the party of the second part the day and year first above written.” (Signed) “ DeAlton Dwight, President. L. E. Pruyne. Attest, John Sinclair, Secretary.” The proof or acknowledgment was as follows:

      “ State of New York,

      County of Jefferson,

      ■ss.:

    “ On this 22d day of August, 1889, before me personally came John Sinclair, to me known and known to me to be the secretary of the Adams Furniture & Manufacturing Company, Limited, of the village of Adams, New York, the corporation mentioned and described in the foregoing mortgage or deed of trust as the party of the first part thereto, who being by me duly sworn did depose and say that he resided in the village of Adams, N. Y.; that he is the secretary of the Adams Furniture & Manufacturing Company, Limited, and knows the corporate seal thereof; that the seal on the foregoing mortgage, or deed of trust is the corporate seal of said company, and was affixed thereto by the order of the Board of Directors of said company, and especially authorized by the stockholders of the company in meeting duly assembled, and that he signed his name thereto by like order as secretary of said company. And deponent further says that he is acquainted with DeAlton Dwight, and knows him to be the president of said company ; that the signature of said DeAlton Dwight _ subscribed to the foregoing mortgage or deed of trust is in the genuine handwriting of said Dwight, and was thereto subscribed by like order of said Board of Directors in the presence of said deponent. (Signed) John Sinclair. Sworn to before me, August 22,1889. A. F. Saunders, Notary Public, Jefferson county.” It was also acknowledged on the twenty-seventh of August by such trustee.
    The thirty-six. bonds secured by the mortgage or trust deed were issued and sold at par to the stockholders of the company. A year or so after the company failed, and went into the hands of a receiver. Subsequently the capital stock was increased, and the then holders of the bonds were requested to surrender them and take stock therefor, which they did. They were surrendered for the purpose of being guaranteed, and then sold to persons not connected with the corporation. It was expressly agreed and understood that they should not be canceled when surrendered, but resold for the benefit of the company. In pursuance of this understanding the bonds were surrendered, guaranteed by individual stockholders, and resold by the officers of the company without any new consent of the stockholders or any written resolution of the directors. The defendants, the Citizens’ National Bank of Adams and Martha A. Sinclair, are judgment creditors of the corporation, their judgments having been obtained in March, 1895.
    On the trial the Special Term held that the plaintiff’s mortgage was a lien prior to the judgments of the defendants, and ordered the usual judgment of foreclosure.

      Lansing, Lcmsing & Jones, for the appellants.

      Rogers <& Abwdl, for the respondent.
   Per Curiam :

The appellants insist that the lien of the mortgage or trust deed given to the respondent by The Adams Furniture and Manufacturing Company (Limited) is inferior to the lien of their judgments because it was not properly acknowledged, or f attested by one witness, as required by the statute. (4 R. S. [8th ed.] 2451, § 137.) We are of the opinion that the proof _pf acknowledgment was a sufficient compliance with the statute,- and that the trust deed or mortgage, when thus acknowledged and delivered, became effectual against subsequent purchasers or incumbrancers. We find no statute which prescribes any particular form of proof or acknowledgment of a deed or mortgage made by a corporation. It was in form like the precedent in Jenkins’ Clerk’s Assistant, which has been in use and followed for many years. No case is cited and none has been found where the precise question involved has been decided, yet the cases we have examined, so far as they bear upon the question, tend to sustain the validity of the acknowledgment. (Lovett v. The Steam Saw Mill Association, 6 Paige, 54; Trustees of Canandaigua Academy v. McKechnie, 90 N. Y. 618, 621.)

In Merrill v. Montgomery (25 Mich. 73), where a conveyance was sealed with the corporate seal, and signed by the president and cashier, it was held that an acknowledgment by the cashier was sufficient. The same doctrine was laid down in Devlin on Deeds (§ 468).

In Claflin v. Smith (15 Abb. N. C. 241, 248) the rules of construction applicable to certificates of acknowledgment are collated and commented upon. In the opinion in that case, among other things, it is in effect said, that where no form of certificate is prescribed it need not be in any particular form, and that “ it is the policy of the law to uphold a certificate when substance is found, and it should be the aim of courts, in cases of defective certificates, to preserve and not to destroy, and the court should be astute to find means to make official acts effectual,” citing Morse v. Clayton (21 Miss. 373); Wells v. Atkinson (24 Minn. 161). If correct in our conclusion that the mortgage or trust deed was properly acknowledged or proved, it follows that it was a lien upon the premises superior to that of the appellants’ judgments.

The appellants, however, insist that even if the mortgage was valid it was discharged by payment of the bonds it was'given to secure. When this mortgage was given the capital stock of the corporation was $20,000. The bonds were all taken by stockholders. It was subsequently determined that the capital stock should be increased to $40,000. The stockholder's who held the bonds were then requested to, and, in pursuance of a resolution adopted by the board of directors of the corporation, did exchange them for stock o'f the company. The bonds were then surrendered to the company by the holders for the purpose of having them guaranteed by individual stockholders and sold to persons who were not connected with the corporation. It was expressly agreed, and distinctly understood, that the bonds were not to be canceled when surrendered, but were to be thus, resold. This was done.

The contention of the appellants is that this mortgage was dis_ charged by the surrender of the bonds, and that their resale without the further consent of the stockholders, or a further resolution of the directors before the rights of the appellants had accrued^ rendered the mortgage invalid as to them. If these bonds had been surrendered for the purpose and with an intent to discharge the debt secured thereby, it would, perhaps, follow that the mortgage would be invalid as to the appellants’ judgments. But manifestly that was not the intent. The bonds were surrendered for the purpose and under an express agreement, or understanding, that they were not to be canceled, but were to be resold to raise money to-conduct the business of the company. Under these circumstances, there was no merger, as clearly such was not the intention of the parties. (Beach on Modern Eq. Juris. § 457; Smith v. Roberts, 91 N. Y. 470; Matter of Gilbert, 104 id. 200; Asche v. Asche, 113 id. 232.) Indeed, there does not seem to be any question of merger involved in this case. The question is whether the surrender of the bonds, in pursuance of the agreement between the holders and the corporation, operated as a payment and consequent discharge of the mortgage given to secure them. As a general rule the payment of a debt secured by a mortgage will extinguish the mortgage. But the intent of the parties will govern, and the mortgage will not be extinguished by the payment if it was the intention to still keep it alive. (Beach on Modern Eq. Juris. § 457; Coles v. Appleby, 87 N. Y. 114; Harbeck v. Vanderbilt, 20 id. 395; Kellogg v. Ames, 41 id. 259, 263; Champney v. Coope, 32 id. 543; Hubbell v. Blakeslee, 71 id. 63; Houseman v. Bodine, 122 id. 158, 164.) It is manifest that it was not the intention of the parties that this mortgage should be extinguished. But the agreement between them shows conclusively ■ that they intended that it should continue in existence as security for the bonds after they were resold by the corporation.

Thus we are led to the conclusion that the contention of the appellants cannot be sustained; that the mortgage was a valid security for the payment of the bonds, and was a lien upon the premises prior and superior to that of the appellants’ judgments. The judgment must be affirmed, with costs.

Present — Hardin, P. J., Martin and Merwin, JJ.

Judgment affirmed, with costs.


source: Caselaw Access Project

author: Per Curiam :

license: Public Domain

text:
    Ellis R. Williams, Appellant, v. The Delaware, Lackawanna and Western Railroad Company, Respondent.

      New trial — decision of Court of Appeals oil a former trial followed, notwithstanding some changes in plaintiff’s testimony.

    "Where a case has been twice before the General Term and has also been heard in the Court of Appeals, and the testimony given upon the last trial at the Circuit is not materially different from that given upon a former trial, the decision, of the Court of Appeals upon which has been followed in the last trial, the General Term will not interfere with the last judgment rendered at the Circuit, especially in a case where it is apparent that the plaintiff has attempted on the last trial to change his testimony so a’s to avoid the effect of the rules of law laid down in the case by the Court of Appeals.
    .Appeal by the plaintiff, Ellis R. Williams, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Oneida on the 28th day of July, 1890, upon an nonsuit granted by the court after a trial at the Oneida Circuit on the 13th day of May, 1890, and also from an order entered in said clerk’s office on the 28th day of July, 1890, granting a nonsuit.

      W. T. Dimmore, for the appellant.

      W. <& N. E. Kernan and William Kerncm, for the respondent.
   Per Curiam :

This action was to recover for j)ersonal injuries sustained by the plaintiff. It was based upon the alleged negligence of the defendant in maintaining a low bridge over its track at Norwich, N. Y., without notice to the plaintiff of its condition or other protection against injury therefrom.

The plaintiff, at the time of his injury, was a brakeman in the employ of the defendant. The accident occurred July 8, 1882. This action was commenced December 30, 1882. It was first tried in February, 1884, when a verdict was rendered for the plaintiff. The defendant thereupon moved for a new trial, which was denied. It then appealed from the judgment and order to the General Term. The appeal was twice argued, and in January, 1886, a decision was handed down reversing the judgment and granting a new trial. The case was again tried at the Oneida Circuit in May, 1886, and the. plaintiff again recovered a judgment. From that judgment and from an order denying the defendant’s motion for a new trial, the defendant appealed to this General Term, and in January, 188J, a decision was handed down affirming the judgment and order, with costs. From the judgment and order of affirmance, the defendant appealed to the Court of Appeals, where the case was argued before the Second Division of that court. In December, 1889, a decision was rendered reversing the judgment and granting a new trial, with costs to abide the event. The case was again tried at the Oneida Circuit in May,'1890, and at the close of. the evidence the .plaintiff was nonsuited.

From this history of the case, it will be seen that it has become somewhat familiar to this court. This is the third time it has been before us. On the first appeal, this court held that the question whether the defendant was negligent in maintaining a bridge at the height of that in question, without notice to its employees or otherwise protecting them against injury from it,»and whether the plaintiff was guilty of contributory negligence, were questions of fact and properly submitted to the jury. The judgment was, however, reversed upon the ground that the trial' court erred in submitting the case to the jury on the theory that the defendant was negligent in not furnishing four brakemen instead of three, as there was no evidence that the plaintiff’s injury was the natural or probable result of that omission, or that the accident would not have occurred without them; or, in other words, because the evidence failed to show that such omission was the proximate cause of the plaintiff’s injury.

After a retrial of the case and upon the second appeal, the court followed its decision upon the former appeal and affirmed the judgment and order denying a motion for a new trial. On the appeal to the Court of Appeals, the judgment was reversed, that court holding that as the accident occurred in the daytime, as the bridge was in plain sight, and as the plaintiff knew the train was about to pass under it and turned his back to it and passed towards the rear of the train when he was struck, a refusal to nonsuit was error, and that if the plaintiff had exercised ordinary care and observation he must have known that the bridge was not of sufficient height to permit a person to pass under it standing on the .top of the car. It was, in effect, further held that the rale that the plaintiff assumed the usual risks and perils of the service and of the open, visible sti’uctures known to him or which he must have known had he exereised ordinary care and observation was applicable, and he was guilty of such contributory negligence as to bar a recovery in the action.

It is contended by the respondent that this decision is controlling and that the actum of the trial court in nonsuiting the plaintiff should be sustained. This contention must be upheld unless the evidence upon the last trial is essentially different from that given upon the foi’mer one. We have exa2nined the evidence contained in the record before us, and also that contained in the appeal book upon which the former appeal was decided. While it must be admitted that the evidence of the plaintiff is somewhat diffe2’ent from that given by hi2n upon the former trial, yet most of the material facts relied upon by the court on the foi’mer appeal as a basis for revei-sing the judgment were established upon the last trial, and most of them were undisputed. Under these circumstances we are reluctant to distui’b the decision of the tidal court, as it is manifest that it sought to follow the rule established by the Court of Appeals in this case, and especially in view of the appar■ent disingenuousness of the plaintiff in giving his testimony upon "the last trial, and his obvious effort to so change his evidence as to ■avoid the former decision in this case. In the case of Hunter v. C. & S. V. R. R. Co. (126 N. Y. 18), where upon a retrial the evidence of the plaintiff’s witnesses was essentially changed for the apparent purpose of avoiding a former decision, the court intimated that in view of the doubt resting upon the character and correctness ■of the evidence as thus changed, it might take as the fact the evidence given by the witnesses on the former trial. In that case the judgment was again reversed, although the General Term was of the opinion 'that under the evidence as changed it was not within the former decision, and was sufficient to present a question of •fact for the jury. While the question of the credibility of the plaintiff’s evidence was doubtless a question for the jury, still, under the circumstances and in view of the former decision of the Court ■of Appeals in this case, we are not disposed to interfere with the judgment appealed from, or to follow or distinguish the other decisions of that court which the appellant contends are not in harmony with its decision in this case. We are of the opinion that that decision was broad enough to cover the decision of the trial court, and that if it is to be modified or overruled it should be by that ■court, and not by this.

Nor do we think that we should disturb the judgment upon the .ground that the court erred in not permitting the plaintiff to read in evidence the testimony of witnesses sworn upon a former trial to the effect that three brakemen were not a sufficient number to prop■erly manage the train. .Upon a former appeal, where all this evidence was before us, this court held that it was insufficient to justify the trial court in submitting to the jury the question of the defendant’s negligence based upon an omission to furnish four brakemen instead of three, as such omission was not the proximate cause of the plaintiff’s injury and did not contribute to produce it. (39 Hun, 430,)

The judgment must be affirmed, with cos-ts.

Present' — Hardin, P. J., Martin and Merwin, JJ.

•Judgment and order affirmed, with costs.


author: Merwin, J.:

text:
    Catharine A. D. Huber, Respondent, v. The Manchester Fire Assurance Company, Appellant.

      Mre insurance — when a dwelling house is “ occupied ” — •when it is not “ vacant ”— effect of a condition that the “ entire policy" shall he void.

    The term “occupation,” as used in policies of fire insurance, means that human beings are present in a dwelling house as at their customary place of abode, not absolutely and continuously, but the house must be the place of usual return and habitual stoppage.
    The cases relating to what constitutes an occupation of a dwelling house examined and considered.
    In an action brought upon a policy of fire insurance against loss to household furniture, it appeared that the policy contained the following provision: “This entire policy * * * shall be void if a building herein described, whether intended for occupancy by owner or tenant, be or become vacant or unoccupied, and so remain for ten days.” Upon this point the evidence was that the plaintiff, who was and for a long time had been a tenant of the house, in which she had been living alone, on August 24, 1892, left the house intending to be absent five or six weeks, at the end of which time she expected to return to the house. The fire occurred in the night of September 17, or the morning of September 18, 1892. .
    It appeared that the agent of the owner had agreed, during the absence of the tenant, to paper and paint every room, except one in -which the tenant had stored substantially all the furniture in the house. She kept the key of this room, nailed up two of the doors of the house, locked up the other two and gave the key of the front door to a friend of hers, with instructions to go there every day to see that the doors were locked and blinds closed after the painters left. The friend, however, did not go every day. It also appeared that all the painting and paper hanging was finished upon September seventh, and that, after that date, nobody was in the house at any time before the fire,

      jReid, that while the house -was not “vacant,” within the meaning of the policy, yet it was “ unoccupied,” and that the plaintiff could not recover;
    That, as the policy provided that, if this condition of vacancy or non-occupancy occurred, the “entire policy” should be void, the plaintiff could not recover under it for the loss of personal property contained in the building.
    Appeal by tlie defendant, The Manchester Fire Assurance Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 16th day of November, 1894, upon the verdict of a jury rendered after a trial at the Onondaga Circuit, and also from an order entered in said clerk’s office on the 23d day of November, 1894, denying the defendant’s motion for a new trial made upon the minutes. .

      W. /S. Jewney, for the appellant.

      Hoyt (& Fcvrrington, for the respondent.
   Merwin, J.:

This action is on a policy of insurance issued by the defendant on the 6fch of June, 1892, insuring the plaintiff for one year; to an amount not exceeding $1,500, against loss or damage by fire to household furniture therein described, “all contained, and while contained, in the two-story shingle roof frame building and its additions, adjoining and communicating, occupied, and to be occupied, as a' dwelling house and situate No. 445 on the East side of South Salina St., in Syracuse, New York.” A fire occurred late in the evening of September 1Y, or early in the morning of September 18, 1892, by which the property was destroyed or injured to the amount, as the jury have found, named in the policy.

In the policy there was the following provision: “This entire-policy, unless otherwise provided by agreement, indorsed hereon or added hereto, shall be void * * * if a building herein described, whether intended for occupancy by owner or tenant, be or become vacant or unoccupied and so remain for ten days.” The defendant, as one of its defenses, claimed that the dwelling house in which the property was, was for more than ten days prior to the fire vacant or unoccupied. The trial court left it to the jury to say whether or not, within the meaning of the policy, the house became or was vacant or unoccupied, and they found in effect that it was not. The defendant claims that upon the undisputed evidence it should have been held by the court that the clause in question was violated, and that the exception of the defendant to a refusal to so rule should be sustained.

The plaintiff rented the house of one Mrs. Dissell and she had lived there for about ten years. She rented it from month to month at thirty dollars a month. The house was fully furnished, and for some time before she left she had been living there alone. On the 24th of August, 1892, she went to Perth Centre, New Brunswick, to visit her mother, and she did not return until after the fire. It was her intention wlien she went away to stay five or six weeks. Before she left, as she testifies, she put all the furnitpre in the house up stairs in one large side room, and every room in the house was perfectly bare except that room, except that the sitting-room stove was left in the sitting room down stairs, and there was an ice box, a jar and a can that were not taken to the up-stairs room. There was an arrangement between the plaintiff and the agent of the owner by which the agent agreed during her absence to paper and paint every room excepting the one the furniture was in. This room was piled full of furniture clear to the ceiling so that, as plaintiff says, “ you could not walk a step in there.” This room the plaintiff locked up and took the key away with her, and left no key with any one else. There were four doors into the house besides the front door. The plaintiff had two of the four doors nailed up. One of the others was locked and the key placed 'in the room where the furniture was, and the key of the other was given to the paper hanger so as to permit him to go in and do his work. The key of the front door the plaintiff gave to a Miss Bates, a friend of hers. Miss Bates, called as a witness by plaintiff, testifies as to instructions from plaintiff, “ she ^wanted I should go there every day, afternoon or evening, to see things were — how the doors were locked and blinds were closed, after the painters left.” This witness, in pursuance of these instructions, went often into the house, but did not go every day. As to the situation after plaintiff left, it was at the trial “ agreed that the painting was done on the 26th, 27th and 29th days of August; and the paper hanging work at various times, twenty-four hours in all, and the work finished on the 7th of September, but the work might have been done any time prior to the 7th for twenty-four hours. The last time anybody was in .the house was before the 7th day of September. No mechanic was in the house, after that date, and before the fire.”

The plaintiff, as she testifies, did not intend to give up the house, and the jury had a right to find that the plaintiff when she left intended to return and live at the house as she had before done.

The foregoing are substantially the facts, as shown by the plaintiff or as agreed on at the trial.

It is quite clear that the house in this case was not vacant. The more serious question is whether or not it was unoccupied within the meaning of the policy. The description of the subject of the insurance is coupled with the clause “ all contained and while contained ” in a certain building “ occupied and to be occupied as a dwelling house.” The kind of occupancy, therefore, within the contemplation of the parties was as a dwelling house.

In Herrman v. Adriatic Fire Ins. Co. (85 N.Y. 162) the plaintiff in June obtained from defendant a policy upon a dwelling house used by him for a summer residence, and upon furniture therein. The policy contained a clause declaring it void in case “ the above-mentioned premises shall * * * become vacant or unoccupied, and so remain for more than thirty days, without notice to and consent of this company in writing.” The plaintiff was then living in the house, but he left with his family in November following, and returned to his city residence to remain for the winter, leaving, however, in the house insured all his furniture and the summer clothing of himself and family. lie also left the house in charge of his farmer, who occupied the farm house, and members of whose family visited and aired the dwelling once a week, and the plaintiff and his wife also visited it once a fortnight. It was held that the dwelling house -was not occupied within the meaning of the policy. At page 169 it is said : “We have already said enough to show our opinion that for a dwelling house to be in a state of occupation, there must be in it the presence of human beings as at their customary place of abode, not absolutely and uninterruptedly continuous, but that must be the place of usual return and habitual stoppage. We think that a verdict of a jury -would not have been allowed to stand that found that this dwelling house was occupied at the time of the fire within the terms of the policy.”

In Johnson v. N. Y. Bowery Fire Ins. Co. (39 Hun, 410) the provision of the policy was that it should be void, unless proper consent was obtained, “if the building herein described be or become vacant or unoccupied for the purposes indicated in this contract.” The insurance -was upon furniture. The plaintiff and her family, a week or ten days before the fire, left on a visit, leaving no one in the house. During this time the husband of plaintiff came back and stayed in the house over night on two occasions, and he and another man stayed there the night of the fire, and the plaintiff expected to return the next day. It was lield that a verdict for plaintiff should not be disturbed.

In Wait v. Agricultural Ins. Co. (13 Hun, 371) the condition in the policy was that if the dwelling house should cease to be occupied by the owner or occupant in the usual and ordinary manner in which dwelling' houses are occupied as such, then the policy should be void until written consent was obtained. The dwelling was occupied by a tenant who commenced to move out on the fifteenth of March, taking most of his furniture and all his family. No one was left in the house, and on the night of the sixteenth it was destroyed by fire. There was some proof that the plaintiff had no notice of the removal of the tenant. .It was held that the question whether or not the house was unoccupied at the time of the fire, within the meaning of the policy, was properly left to the jury.

In Gibbs v. Continental Ins. Co. (13 Hun, 612) the question was whether the premises “ became unoccupied.” The plaintiff slept in her daughter’s house adjoining the premises insured, but her furniture and clothing were in her own house, and she spent the day there. It was held that the house was not unoccupied. In Kelly v. Home Ins. Co. (2 N. Y. Wkly. Dig. 479) there was no time named in the condition during which the building might remain unoccupied, and the question was held to be whether there was an' abandonment of the premises as tenantable property, or a vacancy for an unreasonable time. In Woodruff v. Imperial Ins. Co. (83 N. Y. 133) the form of the condition was vacant and unoccupied,” and it clearly appeared that the building was not vacant. In Vanderhoef v. Agricultural Ins. Co. (46 Hun, 328) the form of the condition was the same as in the W%it Oase (supra), and it was held that the question of occupancy was for the jury. In Stupetski v. Transatlantic Fire Ins. Co. (43 Mich. 373) it was held that a clause avoiding a policy in case the premises should “ become vacant or unoccupied,” did not apply where a man and his family left home for twelve days to visit a sick daughter, and engaged a person to go to the house daily to look after the house and feed the stock. In Franklin Fire Ins. Co. v. Kepler (95 Penn. St. 492) the only question -that seems to have been decided was that the premises were not “ vacated ” by a temporary absence of four days. A similar question was considered in Springfield F. & M. Ins. Co. v. McLimans (28 Neb. 846). In Phœnix Ins. Co. v. Tucker (92 Ill. 64) the terms of the condition were, “ be vacant or unoccupied or not in use,” no time being fixed. The non-occupancy, if any, occurred while a transfer of possession was being made to a tenant. It was held to be a question for the jury, the court saying that what was meant by the terms vacant or unoccupied, as used in the policy, was a question of law, but whether the house was, at the time of the loss, vacant and unoccupied, was a question of fact for the jury. A similar view was taken in Rockford Ins. Co. v. Storig (131 Ill. 646).

The cases we have thus referred to are cited on the part of the plaintiff as supporting her view of the case. They do not seem to be decisive in that direction.

A dwelling house is unoccupied when no one lives therein. (Herrman v. Merchants’ Ins. Co., 81 N. Y. 184, 188.) In Paine v. Agricultural Co. (5 T. & C. 620) it is said that “ occupation of a dwelling house is living in it, not mere supervision over it.” In that case the condition was that in case the house shall be “ left unoccupied ” without giving immediate notice to the company the policy should cease The owner and occupant was absent for six weeks for medical treatment, visiting the house, however, upon different occasions, and maintaining a general oversight over the property therein contained. No notice was given to the defendant. It was held that a finding in favor of the plaintiff could not be sustained.

In Barry v. Prescott Ins. Co. (35 Hun, 601) the tenant of the plaintiff, who occupied the house at the time of the insurance, left it and gave the key to the plaintiff, who thereupon commenced to plaster and whitewash it, and to move her furniture into it with a view of occupying it, and all her furniture had been moved in three days before the fire, but no person was living in it when it took fire. It was held that the house was ifnoccupied within the meaning of the provision that if the premises became vacant or unoccupied, and so remained with the knowledge of the assured, without notice to and consent of the company in writing, the policy should be void. And it was said that under the Herrman Case (85 N. Y. 162) a dwelling house is to be deemed unoccupied when for the time being it is not the place of abode of human beings and used as such. A similar view was taken in Martin v. Rochester German Ins. Co. (86 Hun, 35). In 1 May on Insurance (3d ed., § 249c) it is said: “ The mere presence of goods in the house and a supervision over it is not an e occupancy.’ That requires a living in it.”

In the present case, when the plaintiff placed practically all her furniture in the one room up stairs, filling it full and locked the room, taking the key away with her, and then left the premises and went to New Brunswick, the house ceased for the time being to be the place of her abode, and no one else was living in it. There was in it no inhabitant The fact that her agent had a key and had the supervision of the property was not an occupation as a dwelling-house. That was decided in the Ilerrman case. After the plaintiff left the house was not inhabitable in the ordinary way unless other furniture was moved in, as the plaintiff’s furniture was locked up. The intention of plaintiff to return in four or five weeks did not make an occupation during her absence according to the doctrine of the Ilerrman case. There the plaintiff intended to return in the spring. Yssurne that as between plaintiff and the owner her tenancy continued and she would be deemed to be in possession, that would not answer the requirement. The plaintiff in the Ilerrman case had beyond doubt the legal possession and occupancy. And so it was in the Barry case.

In this case, as in the Ilerrman case, there was a time fixed within which non-occupancy might exist. The question, therefore, does not arise, as in some of the cases, whether the property was unoccupied for an unreasonable time. The parties contemplated that there might be a non-occupancy for a certain time, thereby presumptively covering the exigencies that might be likely to .arise by reason of sickness or sudden or temporary emergencies and sufficient opportunity was given to enable the parties to protect themselves. It was assumed there might be a temporary absence, but a limit was placed. The plaintiff left on the twenty-fourth of August, and from that time to the time of the fire on the seventeenth or eighteenth of September no one was living in the house.

The principle of the Herrman Case (85 N. Y. 162) seems to us'to be directly applicable to this case, and following that case we see no escape from the conclusion that upon the undisputed facts it should have been held that the dwelling house became and was unoccupied and so remained for more than ten days.

But tbe plaintiff further contends that if the house was unoccupied it should not affect the insurance upon the personal property. The provision was that the “entire policy” should be void in the contingency named. The insurance in terms was on certain property contained in the building, and “ while contained ” in it “ occupied and to be occupied as a dwelling house.” Clearly the provision as to non-occupancy must be construed to refer to the particular building that was specified as containing the property and where it was to remain and which was then occupied and was to continue to be occupied as a dwelling house, and necessarily was designed to affect the risk on the personal property insured. The case of Halpin v. Ins. Co. of N. A. (120 N. Y. 73) does not help the plaintiff, while the case of Halpin v. Ætna F. Ins. Co. (120 N. Y. 70) tends to support the view of the defendant. The foregoing considerations lead to g, reversal.

Hardin, P. J., concurred ; Martin, J., not voting.

Judgment and order reversed and a new trial ordered, costs to abide the event.


text:
    George W. Hey, Respondent, v. Matthew J. Dolphin and The International Postal Supply Company of New York, Appellants.

      Contraai —joint agreement between stockholders not to pledge or sell stock for a certain period, not void'as against public policy — power of attorney to vote upon stock so held, when irrevocable.

    As a rule those who have the largest interest in a corporation may control its affairs, since they have the greatest interest that its business shall be well managed.
    In an action brought to have a contract in relation to a transfer of stock in a corporation and a power of attorney declared void as against public policy, it appeared that George W. IIey, Matthew J. Dolphin and three others, who were interested in the development of machines for canceling stamps and postmarking letters, had obtained patents for this purpose, which were transferred to the International Postal Supply Company, a corporation organized' for the purpose of manufacturing and dealing in machines for stamp canceling and post-marking mail matter, and also for the purpose of acquiring and dealing in letters patent for such machines. One-half of the capital stock of the corporation, amounting to 10,000 shares, was issued to the five owners as a payment for the patents, they contributing 2,000 shares, which were placed on the market and sold to provide funds for the corporation.
    Subsequently Hey and Dolphin entered into a written agreement for the purpose of consolidating their interests, by which it was agreed that the parties should jointly own all inventions and improvements in post office machines theretofore or thereafter made or purchased by either party, and that they should contribute equally to the expense of the business and share equally the profits; that all sales of stock of the International Postal Supply Company should be for their joint benefit, and that neither should have the right to dispose of any invention or patent without the consent of the other.
    It appeared that on February 27, 1888, in pursuance of this agreement, three contracts were entered into between Hey and Dolphin, as parties of the first part, and the International Postal Supply Company, as party of the second part, which provided, among other things, for the assignment of their inventions to the International Postal Supply Company, in consideration of the issue of cer- ■ tain shares of capital stock to Dolphin and Hey jointly, each to own one-half, and to be entitled to one-half the dividends declared thereon, the certificates of such stock not to be surrendered or others issued in their stead for the period of ten years, without the joint consent of Dolphin and Hey, nor were the shares to be disposed of or pledged during the same period without the joint consent of Hey and Dolphin. The instruments appointed Matthew J. Dolphin as proxy to vote on said shares, the power of attorney to remain unrevoked and irrevocable for ten years, unless its revocation was sooner assented to by both Dolphin and Hey.

      Held, that the agreement upon the part of Dolphin and Hey that the stock should be held for ten years, during which time the power of attorney was to remain irrevocable, was not void as against public policy;
    That the effect of the arrangement was not materially different from an agreement to become partners as to the stock for a period of ten years;
    That the power of attorney was not revocable at the pleasure of Hey, since it had been given for a consideration and was coupled with an interest;
    That section 21 of chapter 687 of the Laws of 1892, relative to proxies, which was passed after the contracts in question were made, did not apply.

      Semble, that if the statute were tobe given a retroactive effect, it would not apply to the case of a proxy on stock so situated that neither owner could vote thereon without the consent of the other.
    Appeal by the defendants, Matthew J. Dolphin and another, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 10th day of July, 1895, upon the decision of the court rendered after a trial at the Onondaga Special Term, declaring void, certain provisions of three contracts entered into between plaintiff and the defendants on the 27th day of February, 1888, and directing the division between the plaintiff and the defendant Dolphin of certain shares of stock in the defendant corporation.
    The action was in equity, and the relief demanded is

      First. That a certain power of attorney, contained in three contracts entered into between the plaintiff and the defendant Dolphin, as parties of the first part, and the defendant corporation as party of the second part (under which power of attorney the defendant Dolphin was constituted the proxy for the plaintiff in regard to 10,000 shares of stock of the defendant corporation issued in the joint names of the plaintiff and the defendant Dolphin) be declared void and of no force and effect, and that it be canceled and extinguished.

      Second. That the defendant corporation be adjudged and decreed to issue to the plaintiff a certificate or certificates of 5,000 shares of stock, being his proportion of the 10,000 shares of stock issued to. him and the defendant Dolphin jointly.
    ' Third. That the defendant Dolphin be enjoined from voting upon or otherwise interfering with the said 5,000 shares of stock of the plaintiff.

      Samuel ITntermyer, Louis Marshall, Be Witt C. Brown and William S. Andrews, for the appellants

      John IF. Suggett and Ceylon II. Lewis, for the respondent.
   Merwin, J.:

The defendant, The International Postal Supply Company of New York, was duly incorporated under the laws of this State on the 10th of July, 1885. It was formed for the purpose of manufacturing and dealing in machines and other supplies for use and employment in the post offices in this and other countries, including machines and devices for stamp-canceling and post-marking mail matter, and also for the purpose of acquiring and dealing in letters patent for such machines. Its capital stock was $2,000,000, divided into shares of $100 each. The number of its trustees was seven, and they were duly elected. The plaintiff and the defendant Dolphin have been trustees since the organization, Dolphin being the president of the board. The place of business of the corporation is Brooklyn.

Prior to the organization of the corporation Hey and Dolphin with three others were owners, or interested in the development of inventions for machines for stamp-canceling and post-marking letters, and had obtained or applied for two patents covering such inventions. These patents or applications were on the organization of the corporation transferred to it, and 10,000 shares of stock were issued thereupon to the five parties. Of this stock the parties contributed 2,000 shares which were placed on the market for the benefit of the corporation, and sold to provide funds for developing the inventions. On the 14th of October, 1887, Iley and Dolphin entered into a writtén agreement, in and by which,, after reciting that the parties had been engaged in the business of inventing and developing machines for stamping and canceling mail matter and were the joint owners of pending applications for patents and other joint interests connected with the business, and that it was deemed for the best interests of both parties, for the purpose of preventing-friction and disputes, to consolidate their interest in the business into a joint interest as far as it could be effectually done consistently with the rights and obligations of the parties in and to the International Postal Supply Company, it was, therefore, agreed that the parties should own jointly all inventions and improvements in the post office machines of every name and nature theretofore or thereafter made or purchased by either party. A schedule of twelve applications was attached, supposed to include all then made. It was also agreed that the parties “shall contribute in equal shares to the expenses of the said business and of developing and patenting the said inventions, and shall share equally the profits thereof ; ” that all sales of stock of the Postal Company made by either should be for the joint benefit of both, and that neither of the parties should have the right to dispose of any invention, application or patent or of any interest therein without the consent of the other.

On the 27th of February, 1888, the three contracts in question were made between the plaintiff and the defendant Dolphin as parties of the first part, and the corporation defendant as the party of the second part, by which, taken as a whole, the plaintiff - and Dolphin sold and transferred to the company the twelve applications, and inventions contained in the schedule annexed to the contract between Hey and Dolphin, and agreed to assign all inventions or improvements which they, or either of them, might make in post office machines of any description.

One of the contracts specifically covered one of the named applications, and the price to be paid by the company was $400,000 in the capital stock of the company at par value, and it was provided that the stock should be issued in a single certificate of 4,000 shares K to Matthew J. Dolphin and George W. Hey jointly, and the beneficiary interest in the said four thousand shares of stock is hereby apportioned, ascertained and declared to be as follows, viz.: The said Matthew J. Dolphin shall own an undivided one-lialf interest in the said stock, and the said George "W. Iley' shall own the other undivided one-lialf interest therein. The said certificate of four thousand shares shall not be surrendered and another or others issued in its stead for the purpose of dividing the- said stock among the said joint owners thereof, or among them and other or others for the period of ten years from the date of this instrument, without the joint consent of said Dolphin and Iley, which said joint consent shall be reduced to writing and filed with the said company. The said four thousand shares of stock shall not be sold, pledged or otherwise disposed of in whole' or in part during the said period of ten years without the joint consent of the said Dolphin and Hey being so filed with the said company as aforesaid; but it is expressly agreed that the said party of the second part shall interpose no objection or hindrance, but, on the contrary thereto, shall consent, and does hereby consent, to any disposition of the said stock, or any portion thereof, which shall be made by and with the joint consent of the said Dolphin and Iley. The said invention, and others for similar uses, assigned by the said parties of the first part to the said party of the second part in other instruments of assignment, bearing even date herewith, have cost the said parties of the first part great expenditures of time and money, and they have, therefore, made it a condition of this agreement and assignment, as well as of the otliers above referred to, that without the joint consent the stock paid to the said parties of the first part shall not, during the time named, be sold in whole or in part, and shall not be divided among themselves or others, but shall remain as first issued for the purpose of enabling the said parties of fclie first part to prevent the control and management of the said company from passing over to persons who might be less qualified, or less disposed, to make the business of the said company a success and its stock valuable. All dividends paid, and all payments for any cause, or from any source, which may be made by the said company upon the said four thousand shares of stock shall be divided among and paid to the said Dolphin and Iiey, share and share alike, according to their respective interests in the said stock. * * * The said parties of the first part do hereby jointly and severally constitute and appoint the said Matthew J. Dolphin to be their lawful attorney, substitute and proxy for them, and in their names and stead to vote on the said four thousand shares of stock at all annual elections of trustees and inspectors of election for the said company, and at all meetings of the stockholders of the said company, as fully and witli the same force and effect as either of them might or could do if the said stock stood in his individual name on the books of the said company, and he were personally present at such elections or such meetings. This power of attorney shall remain unrevoked and irrevokable for the said period of ten years from the date of this instrument, unless its revocation shall sooner be assented to jointly by the said Matthew J. Dolphin and George W. Hey. In the event of the death of the said Matthew J. Dolphin within the said ten years, the said four thousand shares of stock shall be divided according to their respective interests therein between the said George W. Hey and the heirs or legal representatives of the said Matthew J. Dolphin, and the power of attorney herein executed shall be revoked, unless all parties in interest shall jointly agree to a different disposition of the said stock and its management.”

Another of the contracts covered another application and invention at the same price, with similar provisions as to the form of' the certificate and its disposal and the power of attorney.

The third contract covered the other ten inventions or applications at the price of §200,000 in stock, with similar provisions as to the form of certificate and its disposal and the power of attorney.

The certificates were issued in the form designated, and thereby Hey and Dolphin became joint owners of one-half the stock of the corporation. It appears that at that time they, to some extent, each individually, owned other shares of the stock, not affected by the agreements.

In the complaint it is alleged, among other things, that Dolphin has, since the said contracts were made, controlled the corporation and its business, and has mismanaged the same in divers-named particulars to the great injury of plaintiff and the other stockholders ; that the power of attorney is void under the laws of the State and is contrary to public policy and has been revoked by plaintiff. Belief is asked that it be declared void, and that the corporation issue to plaintiff a certificate of 5,000 shares.

It was found by the Special Term that Dolphin, by virtue of the power of attorney and by exercising the voting powers thereby conferred, has been and still is enabled to control and manage the affairs of the company, but that the plaintiff had not proved any fraudulent mismanagement on the part of Dolphin. At the trial it was held that the evidence on this subject on the part of the plaintiff did not, of itself, call for a revocation of the agreement, or call for a reply on the part of the defendants, and the defendants gave no evidence on the subject. It was, however, held as matter of law that the provisions in the contracts making the power of attorney or proxies irrevocable for ten years, unless their revocation was sooner assented to by Dolphin and Hey, were contrary to public policy, and that plaintiff had a right to revoke the same; that those parts of the contracts that provided that the certificates should remain as they were, and that the stock should not be sold or divided during the period of ten year's without the joint consent of Dolphin and Hey, were contrary to public policy and void, and that plaintiff was entitled to judgment accordingly, and for a partition and division by the corporation of the 10,000 shares equally between Hey and Dolphin.

No question is made about the validity of the issue by the defendant corporation of the 10,000 shares of stock, or as to the right of Hey and Dolphin to buy them, or about the right or power of the corporation to make the contracts. The real contest is between Hey and Dolphin about the character of the ownership of the stock and about its management. The other stockholders are not here complaining, nor is the corporation.

The plaintiff seeks the benefit of the contracts so far as they give him an ownership of ah undivided one-lialf of the stock, but repudiates some of the conditions of the ownership that are connected with the acquisition and are a part of the same transaction. It is not entirely clear that the plaintiff can repudiate conditions which, seem to be somewhat material and still claim full ownership.

But passing that, we come to the question whether the agreement that the stock should beheld for ten years and the power of attorney be for that time irrevocable, was void as against public policy. The-object and purpose of the arrangement as stated in the contracts is not of itself vicious, but rather the contrary. This is not a ease-where, as in some of the cases cited by the respondent, there is a combination of stockholders for the special benefit of some party, or where the power to cast the vote is in a party having no beneficial interest. The arrangement purported to be for the benefit of all the stockholders and the attorney was one of the parties beneficially interested. Nor is it a case of combination of stockholders within the decision of Fisher v. Bush (35 Hun, 641), upon which the respondent relies,, for, in that case, it is said by Judge Barker, page 643 : The owner of property may withdraw it from the market as long as he deems: it for his interest to do so ; and if these parties and their associates were the promoters of this corporation, or owned these shares in common, or as co-partners, then, doubtless, they could have entered into a valid agreement regulating a sale of the same and requiring-the owners to hold them from market for a reasonable and definite-period of time, and thus forbidding a sale by either of his interest to one against whom his associates might have a reasonable objection. (Moffatt v. Farguhar, 7 Ch. Div. 591, in 23 Moak’s Eng. Rep. 731.), A stipulation of that character would not be illegal as against public policy, as it would be simply a provision, assented to by all, that the new comer into the business transaction should be with the-approval of the other joint owners.”

It will hardly be claimed that a majority of stockholders may not combine to control an election of directors. (Havemeyer v. Havemeyer, 43 N. Y. Super. Ct. 506; Barnes v. Brown, 80 N. Y. 537.) In the latter case it is said: “ It is the general rule, sanctioned by the policy of the law, that those who have the largest interest in corporations may control them, as they have the greatest interest that they shall be well managed.” In Brown v. Pacific Mail S. S. Co. (5 Blatchf. 525) it was held that an irrevocable power of attorney or proxy, given by an owner of stock in a corporation, to vote upon such stock, and to continue for the period of four years, reserving certain privileges to such owner in regard to the manner of dealing-in the stock and withdrawing- from such ownership, is not contrary to public policy or open to objection.

It is to be borne in mind that the plaintiff and Dolphin, under the agreement of October 14, 1887, were joint owners of the inventions transferred to the corporation and were partners in the business' of developing and patenting those and similar inventions. Evidently this relation existed when the contracts in question were made, and they related to a part of that business. The relation between Hey and Dolphin was not terminated, but changed; the common property assumed another form, and its management for a definite period, for reasons satisfactory to themselves, and not as between themselves illegal, was intrusted to one of the parties. This was the effect of the power of attorney. The consideration for this was ample, as it was a part of the transaction of the sale of the inventions and the purchase of the stock. It may be assumed that neither of tljie parties would have assented to the sale and purchase except on those conditions. The right to a partition may be waived. (17 Am. & Eng. Ency. of Law, 693, and cases cited.) As partners or as tenants in common, Hey and Dolphin liad the right to deal with the corpus of the stock as a unit, and it is difficult to see why it would be any more against public policy for them to withdraw it from the market for a definite period than it would be for an individual to do so under the same circumstances, -or that any illegal restraint of trade would be accomplished. (Hodge v. Sloan, 107 N. Y. 244.) The nature of the ownership was such that one could not sell without the consent of the other. (1 Cook on Stock, etc., § 429.)

We are of the opinion that the court erred in holding that the provisions complained of were void as against public policy. Nor should it be said that the power of attorney was revocable at the pleasure of the plaintiff. It was a power given for a •consideration, and Dolphin had an interest in the property itself. The stock being issued to the two together, the power of attorney or proxy was necessary in order to carry out the arrangement. (Matter of Pioneer Paper Co., 66 How. Pr. 111; 1 Tliomp. on Corp. 731.) In Story on Agency (§ 477) it is said that where an, authority or power is coupled with an interest, or where it is given for a valuable consideration, it is from its own nature and character in contemplation of law irrevocable, unless there is an express stipulation to the contrary.

The plaintiff further claims that the power of attorney or proxy is revocable under the provisions of section 21 of the General Corporation Law (Chap. 687 of 1892), which, so far as it is important here, is as follows: £: Every proxy must be executed in writing by the member himself, or by his duly authorized attorney. No proxy hereafter made shall be valid after the expiration of eleven months from the date of its execution, unless the member executing it shall have specified therein the length of time it is to continue in force, which shall be for some limited period. Every proxy shall be revocable at the pleasure of the person executing it, but a corporation having no capital stock may prescribe in its by-laws the persons who may act as proxies for members, and the length of time for which proxies may be executed.”

This act was passed after the contracts in question were made, but it is claimed to be effective here under the power reserved in the Legislature to amend or modify a law relating to a corporation. It is not clear that this act, in this regard, was intended to be retroactive. (N. Y. & Oswego Midland R. R. Co. v. Van Horn, 57 N. Y. 473, 477.) Besides, the power of attorney or proxy here considered is not of the ordinary character. Had plaintiff not given it he could not have voted on the stock without the consent of Dolphin. Neither could vote on it without the consent of the other. (Matter of Pioneer Paper Co., supra.) The statute referred to is not, we think, applicable here.

It seems to us that the court erred in holding, as matter of law, that the provisions of the contracts for not disposing of the stock for the period of ten years without the consent of both parties were illegal, and that the power of attorney was void or revocable. The contracts as between the plaintiff and Dolphin were quite analogous to a partnership arrangement for a definite period, and we see no good reason for allowing one party to terminate it at his pleasure. If the plaintiff can show a good reason for a termination of the relation it is to be assumed that he wfill get relief. That question is not before us, nor is the question as to whether some other stockholder may not have a right to intervene.

Hardin, P. J., and Parker, J., concurred.

Judgment reversed and a new trial ordered, costs to abide the event.


author: MerwiN, J.:,

text:
    Minnie M. Albrecht, by John M. Albrecht, her Guardian ad Litem, Respondent, v. Robert H. Canfield, Appellant.

      Cfua/i'dian ad litem— an order appointing Mm stated to have been made at a term of the County Court, but signed by the judge, is a cha/mber order — entry thereof not necessa/i'y — improper allegation in a complaint as to the appointment of a guardian, not an estoppel.

    Where a petition for the appointment of a guardian ad litem for an infant plaintiff is addressed to the county judge, but the order for the appointment is entitled as having been made at a term of the County Court, the court will disregard the caption of the order and hold the order valid upon the assumption that the county judge acted in the capacity in which he was called upon to act, and in which he had a right to act.
    The fact that the order was entered as an order of the County Court does not estop the plaintiff from asserting its true character, as the validity of an order does not depend upon the form of its entry.
    As a rule, an ex parte order of a judge need not be entered, although the papers should be filed.
    An allegation in a complaint, that the guardian ad litem of an infant plaintiff was appointed by an order of a County Court, when in fact the order was made by the county'judge, does not conclude the plaintiff upon a motion made to dismiss the proceeding upon the ground of such irregularity.
    Appeal by the defendant, Robert H. Canfield, from an order of the Supreme Court, made at the Onondaga Special Term and entered in the office of the clerk of the county of Oneida on the 29th day of May, 1895, denying the defendant’s motion to dismiss the action, the complaint herein and all proceedings, upon the ground that the order of the Oneida County Court, purporting to appoint the guardian ad litem for the plaintiff, was made without jurisdiction, or that the plaintiff be required to procure the appointment of some suitable and proper person.

      Henry F. ds Jmnes Coupe, for the appellant.

      M. V. B. Me Or aw, for the respondent.
   MerwiN, J.:,

The heading or caption of the order in question is : “Ata term; of the Oneida County Court, held at the Chambers of the Oneida. County Judge, in the city of Utica, N. Y., on the 29th day of April, 1895. Present, Hon. W. T. Dunmore, Oneida County Judge.” In the body of the order the petition for the appointment of a guardian is referred to as being annexed. At the close of the order it is dated April 29, 1895, and is signed, by the county judge. There is no direction for its entry. Upon referring to the petition, which is handed up as a part of the papers, it appears to be addressed to the county judge and not to the County Court. There was, therefore, no application to the County Court, but there was an application to the county judge. It must, I think, be assumed that the county judge acted in the capacity in which he was called upon to act, and in which he had a right to act. That being so the caption of the order may be disregarded and the order remain properly signed as a valid order. (Phinney v. Broschell, 19 Hun, 116; affd., 80 N. Y. 544; In the Matter of the Knickerbocker Bank, 19 Barb. 602.) (See, also, Dresser v. Van Pelt, 15 How. Pr. 19; People v. Kelly, 35 Barb. 447.)

The fact that the attorney entered the order and called it an order of the County Court does not estop the plaintiff from asserting its true character. Its validity did not depend upon the form of the entry. As a rule an ex parte order of a judge need not be entered (1 Rumsey’s Pr. 213), though the papers should be filed. (Rule 2 of Supreme Court.)

Nor did the allegation in the complaint that the guardian was appointed by an order of the Oneida County Court conclude the plaintiff upon the motion made to dismiss the proceedings. The papers were all before the court and the question on the motion was, not whether the complaint was demurrable (Grantmam, v. Thrall, 44 Barb. 173; Bartholomew v. Lyon, 67 id. 86), but whether there was in fact a valid appointment of a guardian.

The motion was, we think, properly denied and the order of the Special Term should be affirmed.

HaRdiN, P. J., and Martin, J., concurred.

Order affirmed, with ten dollars costs and disbursements.


author: Merwin, J-: .

text:
    Clarence G. T. Smith, Respondent, v. Leopold Leo, Appellant.
    . Unjustifiable expulsion from, a dancing hall — sufficiency of the complaint — measure of damages.

    ' The complaint in an action alleged that the plaintiff, upon the invitation of the ■ defendant, presented himself at the defendant’s dancing school for the purpose ■ of dancing there with the class; that he paid the price of admission and was ¡admitted, but was subsequently expelled, by means of which he had been :greatly injured in his good name and brought into public scandal, infamy and ■disgrace among his associates.

      jHeld, that the complaint stated a sufficient cause of action;
    That as plaintiff had, at the invitation of the defendant, paid the admission fee and entered the hall, he could not be turned out of the hall except for cause;
    That the court properly charged, in effect, that the plaintiff might be compensated for tile indignity and disgrace of a public expulsion; that, while not '•entitled to exemplary damages, the plaintiff’s right of recovery was not to be limited to the price which he paid to secure admission to the hall
    Appeal by the defendant, Leopold Leo, from a judgment of tlie 'Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Tompkins on the 21st. day of March, 1894, upon the verdict of a jury rendered after a trial at the Tompkins ■Circuit; also from an order entered in said clerk’s office on the 8th •day of July, 1895, denying the defendant’s motion for a new trial made upon the minutes, and also from a judgment entered upon .said order in said clerk’s office on the 8th day of July, 1895.

      Tompkms <& Gobb, for the appellant.

      Clarence G. T. Smith and W. B. Estabrook, for the respondent.
   Merwin, J-: .

There are two questions that may be considered in this case: JFirst, whether the complaint is sufficient, and, second, whether the •court erred on the subject of damages.

1. The complaint is somewhat indefinite, still its allegations are 'to be liberally construed with a view to substantial justice (Code Civ. Proc. § 519), and it has been said that less strictness should be ■observed in considering objections to a complaint not made until 4he trial than if they were raised by demurrer. (St. John v. North rup, 23 Barb. 26.) Facts may be impliedly averred. (Marie v. Garrison, 83 N. Y. 14, 23.)

In the complaint it is alleged that the plaintiff, upon the invitation of the defendant, presented himself at defendant’s dancing school on a certain evening for the purpose of dancing with defendant’s dancing class, at that time and place congregated; that the plaintiff was admitted to the hall occupied by the dancers upon the payment by him to defendant of the sum demanded as the price of admission ; that after plaintiff made himself ready for dancing and had been in the hall some time, he was expelled from the hall by the defendant, by means of the committing of which grievance by the defendant the plaintiff has been and still is greatly injured in his good name, fame and credit, and brought into public scandal, infamy and disgrace with and amongst his associates and others to the damage of the plaintiff of §2,500. Judgment for that amount was demanded.

In substance it was alleged that, the defendant had willfully deprived the plaintiff of the enjoyment of a right that he had purchased of the defendant. The method of expulsion is not stated, but the word expel ordinarily means to drive or force out or reject. So that the defendant impliedly not only deprived the plaintiff of liis right, but, with indignity and disgrace, put him out of the hall where, by liis contract witli defendant, he had a right to be.

The action is quite analogous to that of a passenger for illegal removal from a railroad train, and is, we think, maintainable under the allegations of the complaint. The plaintiff having, at the invitation of defendant, paid the admission fee and entered the hall, the defendant had no 'right to turn him out in the absence of sufficient cause. (Magoverning v. Staples, 7 Lans. 145, 148; Drew v. Peer, 93 Penn. St. 234, 242.) (See, also, McGowan v. Duff, 14 Daly, 315; McCrea v. Marsh, 12 Gray, 211.)

2. A point is made by the defendant on the theory that the court allowed the jury to give exemplary damages. This, however, is not a correct assumption. Taking the whole charge together, the jury were only allowed to give compensatory damages, and there is nothing in the amount of the verdict that indicates that the jury did otherwise. The court, in effect, charged that the plaintiff might be compensated for the indignity and disgrace. In Hamilton v. Third Ave. R. R. Co. (53 N. Y. 25), which was an action for being improperly ejected from the defendant’s car, it was held that, as a part of the compensatory damages, there could be given a suitable recompense to plaintiff’s feelings. A like view was taken in Buck v. Webb (58 Hun, 185) and Fisher v. Met. El. Ry. Co. (34 id. 433), and the fact that no actual force was applied was not deemed to vary the rule. In 1 Sedgwick on Damages (8th ed., § 47, p. 67) it is said : “ Sense of insult or indignity, mortification or wounded pride is a Subject of compensation. A common instance is where a passenger is wrongfully ejected from a railroad train,” and numerous cases are cited. The difficulty in estimating'such damages is no objection to their recovery. (Id. § 46, p. 63.)

The plaintiff paid as the price of his admission one dollar and forty-five cents, and the defendant claims that the recovery should be limited to that amount. Upon this subject, the plaintiff having been limited in his recovery to the damages actually sustained by him, we think the court did not err.

It is suggested by the defendant that the court at the commencement of the trial, in denying a motion made by the plaintiff to amend the complaint, limited the scope of the action in stating that it was an action for damages under a contract for being expelled from a hall! The most that the courtheld w&s that the plaintiff must stand by his complaint and the facts therein alleged.

We find no sufficient ground for reversal.

Hardin, P. J., and Martin, J., concurred.

Judgments and order affirmed, with costs.


text:
    Pius Stahlberger, Respondent, v. New Hartford Leather Company, Appellant.

      Principal and agent — power of the general manager of a corporation to hire employees — acope of his appan'ent authority where restrictions thereon are not communicated to the employee.

    In an action brought by a servant to recover, as damages for a breach of contract, his wages for the balance of a year, it appeared that the defendant was a corporation having a general manager named Rose, who had been employed shortly before the time of the hiring of the plaintiff for a term of five years, under a contract which provided that his actions as general manager and superintendent were to be in all things under the direction and control of the board of directors of the defendant. It also appeared that about the time of the malting of this contract a director named Seaton was appointed managing director, but it did not appear that Seaton had ever hired any one, or that he had ever asked the plaintiff in regard to the arrangement under which he was working for the corporation.
    Held, that a judgment in favor of the plaintiff should be sustained;
    That the court properly refused to hold as a matter of law that the defendant was not bound by the acts of Rose;
    That the court properly refused to charge that the contract made between Rose and the defendant did not confer authority upon Rose to bind the defendant by a contract of hiring for one year ;
    That in the absence of proof that Seaton had advised or controlled Rose in the selection of servanreT the presumption was that Rose had the general authority of a general, manager, and consequently such request to charge could not be sustained upon the theory that the approval of Seaton was necessary to give validity to his acts;
    That the company would be bound to carry out an agreement made by Rose with any person dealing with him, within the apparent scope of his agency and without knowledge of any restriction upon his presumptive powers.
    Appeal by the defendant, the New’- Hartford Leather Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the cleric of the county of Oneida on the 26th day of March, 1895, upon the verdict of a jury rendered after a trial at the Oneida Circuit, and also from an order entered in said clerk’s office on the 18th day of April, 1895, denying the defendant’s motion for a new trial made upon the minutes.

      Vcm Aulcen dk Pitcher, for the appellant.

      Atyles, Searle dk Sayles, for the respondent.
   Merwin, J.:

Tlie defendant is a domestic, corporation, organized in the spring of 1893, for the purpose of tanning and manufacturing fancy leather at the village of New Hartford. .The plaintiff is a tanner by trade, and on the 24th of July, 1893, he entered into the employ of the defendant under a contract of hiring, as he claims, for the term of one year, at the price of wages of thirteen dollars and fifty cents a week, payable at the end of every week. He continued at work to the 21st of October, 1893, and was then discharged. This action is to recover, as damages for the breach of the contract, his wages for the balance of the year, less what he has been able to earn elsewhere, and the recovery is on that basis. The claim of the defendant is that the hiring was by the day, and not otherwise, so that it had a right to discharge the plaintiff at any time.

The contract with plaintiff was made on the part of defendant by one Rose, who was its general manager. Rose had a written contract with defendant, dated June 30, 1893, by which he was employed by the defendant for the term of five years to act as its general manager and to superintend the manufacturing and tanning of leather, and it was by the contract provided that he was to be in all things under the direction and control of the board of directors of the defendant. It was also provided that if at any time the board of directors of the defendant should decide that it was not for the interest of the company to continue its business, the contract should be canceled and the employment of Rose should terminate. There was evidence on the part of the plaintiff that tended to show that Rose, as general manager of defendant and acting for it, employed plaintiff for a year. There was evidence to the contrary on the part of the defendant. Whether there was such a contract.' made was clearly a question of fact, which the' jury have disposed of in favor of the plaintiff.

But the defendant claims that Rose, as general manager, had no-power to make a contract for a year. Besides the contract between defendant and Rose, there was some evidence that Rose had the general management of the business, and had general power to hire and discharge men. There were five directors of the corporation, and on the 16th of June, 1893, they appointed one of their number, Mr. Seaton, managing director. It does not appear that, after the contract with Rose was made, the board of directors as such took any action limiting or controlling the power of Rose. There, was evidence on the part of the defendant that Rose, before consummating any arrangement for help, consulted with Seaton; also that before plaintiff left, Seaton never hired any one, and that he never-asked plaintiff under what arrangement lie was at work. Plaintiff lived at the village of Oneida, and upon entering the employ of defendant moved his family to New Hartford. According to the testimony of Rose, on the part of defendant, the plaintiff was discharged for cause, but no defense of that kind is set up.

At the close of the trial, the defendant moved for a nonsuit upon-, the ground, among others, that no authority was shown in Rose to ■ hire plaintiff for a year. This motion was denied and defendant, excepted. Defendant also moved on the same grounds that the; court direct a verdict in its favor. This was denied and exception taken. The court charged the jury that, under the contract between. Rose and the defendant and upon the other evidence in the case,,, whatever Rose did -with reference to hiring the plaintiff was the-same as if the defendant in person had done it, and whatever bargain Rose made, so far as this case was concerned, the defendant made, and refused upon the request of defendant to charge that the contract between defendant and Rose did not confer authority upon Rose to bind the defendant hy the contract of hiring for a year. Defendant duly excepted'.

In Cox v. Albany Brewing Company (56 Hun,. 489), which was-an action like the present for damages under a contract of employment for a year, it was held that “ an agent who has authority to - hire parties to work, as between his principal and strangers dealing; with him, will be deemed to possess general authority to employ unless the limitation or qualification of his authority has been made-known to the persons whom he employs in the service of his principal.” In Williams v. Getty (31 Penn. St. 461), which was an action for damages on a contract of employment made between, plaintiff and the general manager of defendant, it was held that-“'the authority of a general agent to contract so as to bind-his-principal, is only limited to the usual and ordinary means of accomplishing the business intrusted to him. If the principal holds out the agent to the world as a general agent in the transaction of his business, any contract made by him within the scope of that business will bind the principal, although there may be, as between the principal and agent, a restriction upon the general authority of the latter, if the person with whom the contract is made have no notice ■of such restriction. Persons dealing with an agent carrying on a general business, such as a general manager of a railroad contractor, are not bound to inquire into the particulars of the agent’s ■authority when held out to the world as a general agent.”

A general manager of a lumber manufacturing corporation has been held to be authorized to employ workmen for the season, although he had no express authority to employ by the season. (Ceeder v. Lumber Co., 86 Mich. 541; 4 Thompson on Corp. §4854.) A foreman intrusted with the general management of a trade or business has an implied general authority from his employer to enter into all such contracts as are usually and necessarily entered into in the ordinary conduct and management of the business.” (Addison on Contract, § 69.) (See, also, 2 Cook on Stock, etc., .’§ H9.)

The case of Smith v. Co-operative Dress Association (12 Daly, 304) is relied on by the defendant. In that case one Wales was, .in July, 1881, employed by defendant as general manager for one year. In March, 1882, he hired plaintiff for one year as a buyer.” It was held that the defendant was not bound. There were no circumstances that indicated any apparent authority to make a special ■bargain of that kind, and emphasis was given to the fact that the ■control of the general manager was limited to a year. This does .not reach the present case.

The motions for a nonsuit and for a direction of a verdict for ■defendant were properly denied. By these the court was asked to .hold as matter of law that the defendant was not bound by the act •of Rose. There was, outside of the contract of Rose with the •defendant, evidence tending to show that Rose was held out as general agent with general power to hire and discharge men, and that the contract with plaintiff was within the scope of such agency,

■ and that plaintiff had no knowledge of any restriction on the apparent power of Rose. Yery clearly the court was right in declining to say, as matter of law, that Rose had no power to bind the defendant. The exception to the charge that Rose did, under the contract and the other evidence in the case, have power to bind the defendant, is not available under the ruling in the case of Village of Port Jervis v. First Nat. Bank (96 N. Y. 551, 560), there being no request to have the question of authority submitted to the jury.

Nor do we think that the court erred in refusing to charge that the contract between Rose and the defendant did not confer authority upon Rose to bind the defendant by the contract of hiring for a year. The point of the defendant seems to be that no contract of Rose would be effective to bind the defendant until the defendant by its managing director approved of it. This construction should not, we think, be given to the contract between Rose and the ■defendant. The board of directors and probably the managing ■director had the right to control and direct Rose in the discharge of his duties, but in the absence of such direction the presumption would be, as the trial court well said, that Rose had the general •authority of a general manager. Any one dealing with Rose within the scope of the agency and without knowledge of any restriction •on his presumptive power, could hold the company. The presumption was that Rose had power to make the contract with plaintiff, ■and so the request was properly refused. If there was any question whether the contract with plaintiff was within the scope of the .agency of Rose, or whether the plaintiff had any notice of any limitation on the authority of Rose, the defendant should have asked ■for the submission of those questions to the jury.

The provision of the contract between Rose and the defendant that the contract might be terminated if thought best for the interest of the defendant is not important here, as there is no claim that it •did not continue long after the term of plaintiff’s contract.

These considerations lead to an affirmance of the judgment.

Hardin, P. J., and Martin, J., concurred.

Judgment and order affirmed, with costs.


author: Merwin, J. :

text:
    William Wilcox and Others, Respondents, v. James H. Williams and Others, Appellants.

      Partnership — where it is at will equity will not enforce speeifie performance thereof — equal powers and rights, the test of a pm'tnership.

    Where a partnership at will exists equity will not interfere to enforce specific performance of the agreement of partnership.
    The true test of partnership is the intention of the parties, and where it does not-appear that it was intended that all the parties to an alleged partnership should have equal powers and rights over the plant and the business, the court will be-justified in concluding that, whatever may have been the nature of the agreement, no true partnership existed.
    Appeal by the defendants, James H. Williams and others, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of Tompkins on the 31st day of May, 1895, upon the report of a referee, setting aside as null and void an assignment dated December 9, 1893, from the defendantsBufford and Kitson to the defendants Williams and Redfield, of three cértain letters patent, and decreeing that Bufford and Kitson execute in due form a conveyance of such letters patent to the firm known as the Ithaca Drop Forge Company, composed of the plaintiffs and Bufford and Kitson.

      William JF. Dylcman, for the appellants Williams and Redfield.

      Framois Forbes and Charles T. Ilaviland^ for the appellants. Bufford and Kitson.

      George B. Davis and A. P. Smith, for the respondents.
   Merwin, J. :

On and prior to January 1, 1891, the defendants Bufford and Kitson were the owners of three letters patent, duly issued to them, one on the 15th of July, 1890, and the others on December 9, 189Ó, upon certain improvements in pipe tongs oT chain wrenches invented by Bufford. These letters were for the term of seventeen years. In the complaint it is alleged that on or about January 1, 1891, the-plaintiffs and Bufford and Kitson entered into a co-partnership under the name of the Ithaca Drop Forge Company, for the purpose of manufacturing pipe tongs or chain wrenches that should embody the improvements covered by the said patents ; that by the terms of the agreement of partnership the plaintiffs were to furnish the necessary capital stock for the purpose of erecting a plant, purchasing machinery and tools, together with the necessary stock and appliances for the purpose' of manufacturing the wrenches, and also furnish the necessary funds to defend any suit for infringement; that Bufford and Kitson agreed to assign to the company their letters patent so that the partnership would be the entire owners of the same.; that Bufford and Kitson were to receive one-fifth of the profits and the plaintiffs four-fifths; that the plaintiffs performed on their part, but Bufford and Kitson did not assign the patents, and, on the contrary, on the 19th of December, 1893, assigned the same to the defendants Williams and Redfield, who had knowledge of plaintiffs’ rights. Judgment was asked that the rights of the parties in the-patents be determined; that the assignment to Williams and Bed-field be set aside and a conveyance be made by Bufford and Kitson to the firm. This action was commenced on February 6, 1894.

. The referee finds that a partnership was formed on or about. January 1, 1891, and by the terms of the agreement the plaintiffs. “ were to furnish the necessary capital stock for establishing a plant, purchasing machinery and appurtenances for said purpose of manufacturing said chain wrenches, and introducing the same to the market, and also to advance to said company the funds necessary to-defend any suit that might be brought for infringement of any letters patent of the United States by reason of the manufacture, use. or sale of such chain wrenches, and to prosecute infringers of said three letters patent, Nos. 432,195, 442,306 and 442,569 ; that in consideration thereof, the said defendants George W. Bufford and John E. Kitson, agreed to transfer and assign to said company their said three letters patent, set forth as aforesaid, and that the said co-partnership was to have all right, title to and interest in and to the said three letters patent, and the exclusive right to manufacture and sell the said Champion chain wrench under the protection of said three letters patent, and that said Bufford and Kitson were to receive one-fifth of the said plant, machinery, patents, etc., and of the profits of said business, and that the plaintiffs were to receive the other four-fifths of the property, patents and of said profits; that the. name adopted by said co-partnership was the “Ithaca Drop Forge Company,” and the said co-partnership since that time has been and still is carrying on business under that name, making and selling said chain wrenches; that the plaintiffs have performed on their part, advancing large sums of money in establishing a plant and in purchasing stock and materials and in defending a suit for infringement ; that on the 19th of December, 1893, the defendants Bufford ■and Kitson, without the knowledge or consent of plaintiffs, assigned the patents to the defendants Williams and Redfield who were not purchasers in good faith.

As matter of law it was decided that the assignment to Williams and Redfield was void ; that Bufford and Kitson should execute to the firm a conveyance of the ¡patents, and that the firm composed ■of the plaintiffs and Bufford and Kitson should be adjudged to have the right and title to the patents since January 1,1891.

It is not alleged or found that the partnership, as claimed by the plaintiffs, was for any definite period. If so, it wras a partnership ■at will and dissolvable at the pleasure of any of the parties. (Story on Part. § 269; McElvey v. Lewis, 76 N. Y. 373.) In such a case •the general rule is that equity will not interfere to enforce specific performance of ythe agreement of partnership. (Pomeroy on Spec. Perf. § 290.) Equity will interfere “ only when the partnership is for a definite period, or such decree is necessary to invest one of the parties with legal rights which he could not otherwise possess.” (Parsons on Part. [4th ed.] § 205.)

There was undoubtedly some arrangement between the plaintiffs, either individually or as officers of a corporation hereafter referred to, and Bufford and Kitson, that resulted in the manufacture of the Champion chain wrench embodying the improvements covered by the patents in question. It appears that a contract to furnish a large quantity of them had been made with the assent of Bufford and Kit-son, and this contract to a large extent had not been filled when Bufford and Kitson transferred the patents. It may be that to enable the plaintiffs or the corporation they may have represented, or the firm if there was one, to carry out this contract, a court of equity would give relief. It, therefore, becomes important to consider the question of what the relation was in fact between the parties.

By the judgment in this case it is determined that there was between these parties a partnership from January 1, 1891, one of the terms of which was that the partnership should be the entire owner of the patents from that date and have a transfer thereof from Bufford and ICitson. It is in effect claimed by the appellants that the finding of the existence of a partnership is against the weight of the evidence, and that even if there was a partnership for some purposes it was not one of its terms that the firm should become the entire owner of the patents, or that they should be transferred to the firm.

Prior to 1891 there had been formed at Ithaca a corporation under the name of the “ Hague Expansion Horse Shoe Company,” with a fixed capital of $25,000. Its members were the plaintiffs and one Hague. Machinery had been purchased and a plant established for the manufacture of the Hague expansion horse shoe, and it had been to some extent manufactured. The plaintiffs had furnished the money necessary to purchase the machinery and plant in the expectation apparently of receiving therefor stock of the corporation. No stock seems to have been issued and the plaintiffs claim that they never turned the property over to the corporation, and this the referee in effect finds. It is not clear from the evidence that the corporation had no interest in the property,, or that the plaintiffs had any right to turn it over to a new concern, as they claim to have done. The corporation is still in existence.

Bufford and ICitson were skilled mechanics, and had been in the employ of the plaintiffs or the corporation. About January, 1891, some arrangement was made under which the manufacture of the Champion chain wrench was entered upon. The arrangement, whatever it was, was not in writing. The machinery and plant used in the manufacture of the horse shoes was used in the manufacture of the wrenches, and also other machinery purchased by the plaintiffs or made at the factory. Bufford and Kitson continued at work at the factory, and were engaged, among other things, in making dies for use in making wrenches. The wages of each were reduced from twenty-one dollars a week to twelve dollars a week, one of the plaintiffs testifying that this was to continue until they got the wrench so that it was a paying business. There was talk about a change of the name of the Hague Expansion Horse Shoe Company to that of the Hague Drop Eorge Company, and quite a number of the wrenches first made were stamped as made by the Hague Drop Forge Company. In the spring of 1891 the name Ithaca Drop Forge Company was agreed on, and about that time Hague withdrew. The manufacture continued under the name of the Ithaca Drop Forge Company, and wrenches were placed upon the market. In September, 1891, a suit for infringement was brought in the United States court by the defendants Williams and Bedfield against parties wlie were selling the wrenches, the plaintiffs Bufford and Kitson being also defendants therein. Evidence was taken in that suit'in July, 1892, and in April, 1893. ■ That suit was pending until after the'transfer to Williams and Bedfield, and it was then discontinued. In the summer of 1893 Kitson lef.t the employ of the concern. Bufford, about the same time, left for a time, but returned and continued at work there until December, 1893, a short time before the transfer. Other work besides making wrenches was to a considerable extent being done at the factoiy. The wages of Bufford and Kitson seem to have been continued as they were fixed at the beginning of the enterprise.

No demand seems to have been made by plaintiffs for a transfer of the patents until the latter part of 1893, when it was apparent -that Bufford and Kitson were dissatisfied, and were trying to sell their patents to other parties. Shortly before this the letter heads used in the business had been changed so as to state that the Ithaca Drop Forge Company not only manufactured the wrenches but owned the patents. This claim Bufford immediately disputed, and, after conferring with Kitson, offered to sell the patents to others. The change in the letter head, evidently made as an afterthought and in view of the controversy, does not aid the theory of the plaintiffs. The plaintiffs, before they started upon the enterprise, took advice in regard to the patents, and it is to be presumed that they knew of the necessity of a transfer in order to perfect ownership in themselves. The failure to have a transfer before they incurred expenses reflects on the character of the arrangement in fact made. As the title of the patents remained in Bufford and Kitson, they were presumptively the owners. (Chamberlin v. Chamberlin, 44 N. Y. Super. Ct. [12 J. & S.] 116.)

Up to the time Bufford left, about 7,000 wrenches had been made and put on the market, and there .was an outstanding order for several thousand more. The price of the wrench was from two dollars and fifty cents to eighteen dollars. It does not appear what amount of profits liad been made. The situation of the accounts does not appear, and no dividends were made.

In January, 1891, the value of the patents in question was uncertain. They might turn out to be valuable, or they might be worthless. The project for the manufacture of the wrenches was clearly an experiment. It is not probable that at that time the plaintiffs would be, or were willing that. Bufford and Edison should have, as found by the referee, a fifth interest in their valuable property in return for what might be not only of no value but a source of considerable expense. The theory, as claimed by the defendants, is more plausible, that the manufacture was undertaken upon the understanding that if it proved a success the plaintiffs would give for the patents a certain amount of the stock of the corporation. This view is considerably corroborated by the testimony of one of the plaintiffs, given, as I infer, in 1892 in another action, to the effect that if the wrench proved a success the patentees were to be given for their patents a certain amount of the stock of the company.

The true test of partnership is the intention of the parties. (Parsons on Part. [4th ed.] §54; Central City Savings Bank v. Walker, 66 N. Y. 428.) Here the question is what did the parties intend in January, 1891, when they entered upon this transaction ? If a partnership, as found by the referee, then Bufford and Ivitson had the same control over the property as the other parties and had like power to bind the members. Can it be said in this case that it was the intention of the parties that Bufford and Kitson should have the same powers and rights over the plant and the business that the plaintiffs had ? It seems to me not.

Beference has thus far been made to some of the main features of the case. A careful examination of the evidence leads us to the conclusion that the finding of the referee of the formation of a partnership which involved the entire ownership by the partnership of the patents in question, is against the weight of the evidence. A reversal of the judgment must follow.

It may be that the plaintiffs have still some basis for relief to give them the protection of the patents as to the wrenches contracted to be furnished with the knowledge and consent of the patentees. But this subject need not be considered here.

Hardin, P. J., and Parker, J., concurred.

Judgment reversed and new trial ordered, costs to abide the event.