author: Follbtt, J.:

text:
    Mary Elizabeth Palmer and Others, Appellants, v. Abbie S. Marshall and Others, Respondents.

      Statute of Uses and Trusts, § 55 — conversion of real estate into personalty by a will —power of sale to executors — no bar to an action of pa/i'tition — waiver of a defect of parties in a complaint.

    In order to establish a valid trust under the first or second subdivision of section 55 of the Statute of Uses and Trusts, there must be an absolute and imperative direction to the executor to sell the real esUi.e forming a portion of the trust created, and unless the will converts the realty into personalty, no valid trust under the first or second subdivision of the section is established.
    Where it is evident from the face of a will that the testator intended not to require his executors to sell the real estate forming a part of a trust therein created, but to permit them to sell it, and to divide the proceeds or to divide the real estate among the devisees, there is no conversion of the realty into personalty.
    The pofvcr to sell real estate granted to his executors by a testator is not an absolute legal bar to an action for the partition of such real estate, and it may be that under certain circumstances it is notan equitable reason for denying a judicial partition or sale thereof.
    Where a defect of parties appears upon the face of a complaint, and no objection is taken thereto by demurrer or answer, the objection is waived, and cannot be insisted upon as a matter of right.
    A defect of parties not pleaded is seldom a sufficient ground for dismissing an equity action.
    Appeal by the plaintiffs, Mary Elizabeth Palmer and others, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the county of New York on the 28th day of February, 1894, upon the decision of the court rendered at the New York Special Term dismissing the plaintiffs’ complaint upon the merits, and also from an order made at the New York Special Term and entered in said clerk’s office on the 18th day of April, 1894, amending the said judgment and also from the said judgment as amended.
    Rufus Story, a resident citizen of New Jersey, died October 6, 1877, at Bergen Point, in that State, leaving Ursula Story, his widow, and Mary E. Palmer, Alice Rowland, Abbie S. Marshall and Emily L. Paret, daughters, his heirs and next of kin. He left a large personal estate and real estate situate in the States of New Jersey and New York. lie left a last will and testament, which was duly probated in New Jersey as a will of realty and personalty, and letters were issued thereon to Mary E. Palmer, Alice Rowland and Dwight P. Cruikshank. On the 12th of October, 1887, the will was duly admitted to probate in this State and letters were issued thereon to said executors.
    .The testator, by the first clause of his will, bequeathed to his widow his household goods, furniture, horses and carriages; by the second clause he devised to her a life estate in his homestead ; by the third clause he directed that his executors invest $100,000 and pay the income thereof to his widow during her life; and by the fourth clause he gave to his grandson, Rufus S. Paret, $5,000, less a policy of life insurance of $2,200, on his reaching the age of twenty-one years.
    The following are the fifth and sixth clauses of the will, over the construction,of which this litigation arises:

      “Fifth. I give, devise and bequeath all the rest, residue and remainder of my estate, real as well as personal, of every name and nature and wheresoever situate, of which I shall die seized, possessed or entitled (and including on the death of my wife my said homestead mentioned in the second clause of my will and the investment directed to be made for her benefit by the third clause of my will) to my executrices and executors, the survivors and survivor of them, or to such of them as may qualify, and the survivors and survivor of them, in trust and to and for the uses and purposes following, that is to say:
    “ 1. That they sell, dispose of and convey the same at public or private sale, at such times and on such terms as they in their, his or her discretion, may think proper.
    “ 2. That they divide such real and personal estate, or the proceeds thereof, into four equal ¡Darts or shares, one of such shares for each of my daughters, Mary Elizabeth Palmer, Emily L. Paret, Alice Rowland and Abby Story. * * *

      “ That my executors convey, pay and assign the shares of my daughters Mary Elizabeth Palmer, Alice Rowland and Abby Story to them absolutely, and hold, retain, invest and keep invested the share of my daughter Emily L. Paret, and collect and receive, and pay or apply, the rents, interest and income arising therefrom to the use of my said daughter during her life.

      “ Should any of my daughters die in my lifetime, or on the death of my daughter Emily L. Paret, I give, devise and bequeath the share the one so dying would have been entitled to, to her issue absolutely, and if none, then to my surviving daughters and to the issue of such of my daughters who may have died, such issue to take by representation.
    ■ “ Sixth. I authorize and empower my executors to pay all the taxes and assessments which may be imposed upon my property (including, during the life of my wife, my said homestead) until the division or sale thereof; also to pay all premiums of insurance and sums necessary to keep the buildings (including those on my homestead during the life of my wife) in good repair, to lease or rent any of my real estate until such sale or division, and to make all divisions and partitions of any real and personal estate, or the proceeds thereof; also to make, seal, execute and deliver all necessary deeds or other instruments in writing, with or without seal, necessary in the premises.”
    By the second codicil to the testator’s will he provided :
    “ It is my will that the remainder of said share of my daughter Emily shall be held and invested and kept invested during her life by my executors and trustees, who shall collect and pay or apply the interest and income thereof to the use of my daughter Emily se' long as she shall live, and if she be not living, or on her death, that my executors and trustees convey, pay and assign such residue of such share to her issue absolutely.”
    The widow accepted the provisions of the will in lieu of dower, and before this action'was begun she died. The four daughters are living. Mrs. Paret has nine children and three grandchildren. Mrs. Palmer has five children and five grandchildren. Mrs. Rowland has five children and no grandchildren. Mrs. Marshall has one child and no grandchildren. This action was begun May 8, 1891, to partition the real estate situate in this state left by the testator. The four daughters and their husbands and their descendants, and the husbands and wives of such as are married, are parties to this action.
    Emily L. Paret and six of her children, who are adults, answer and contest the right of the plaintiffs to the partition. None of the other adult defendants answer, but the defendants who are minors answer by their guardians ad litem and submit their rights to the court.

      John E. Parsons, for the appellants.

      Louis V. Booraem, Black <& King, William B. Bristol and Uermam W. Schmitz, for the respondents.
   Follbtt, J.:

The learned counsel for the appellants insists that the legal title vested in the three daughters other than Mrs. Paret and in the plaintiffs, as trustees, for her, that they are tenants in common, and that an action to partition may be maintained. The learned counsel for the respondents insist that a valid trust was created, that there .was a conversion of the realty into personalty out and out, and that the legal title to the entire estate is in the executors, as trustees, under the will.

It is apparent that testator intended to empower the executors in their discretion to convert his residuary estate, real and personal, into money, and pay one-fourth thereof to each of his daughters Mary E. Palmer, Alice Rowland and Abby Story (now Marshall), and as trustees to hold the other fourth in trust during the life of Emily L. Paret, collect the income thereof and apply it to her use during her life, and after her death to pay it to her issue. However, the executors are not commanded to convert the estate into money, but are authorized to divide it into four equal shares and convey, pay and assign the shares of my daughters Mary Elizabeth Palmer, Alice Rowland and Abby Story to them absolutely, and hold, retain, invest and keep invested the share of my daughter Emily L. Paret, and collect and receive and pay or apply the rents, interest and income arising therefrom to the use of my said daughter during her life.”

In the sixth clause the executors are empowered to make all divisions and partitions of any real and personal estate, or the proceeds thereof,” and “ to lease or rent any of my real estate until such sale or division thereof, and to pay all taxes and premiums on policies of insurance until the property shall be divided or sold.”

The executors are not directed to apply to any purpose all of the rents and income arising from the undivided estate, nor are they directed to apply one-fourth of the rents and income arising from the undivided estate to the use of Mrs. Paret, but the direction in respect to the application of “ rents, interest and income,” -relates solely to that which shall arise after the division of the estate from her share held in trust. The language is, and hold, retain, invest and keep invested the share of my daughter Emily L. Paret, and collect and receive and pay or apply the rents, interest and income arising therefrom to the use of my said daughter during her life:” It may be that the income of one-fourth being given for the support of Mrs. Paret, that the executors could be compelled to apply some portion of the income of the undivided estate, not exceeding one-fourth, to her use in advance of a division and of the establishment of the trust estate. Under the statutes of this State (1 R. S. 728, 729), the interests and the estates of the devisees under this will seem to be plain.

“ § 55. Express trusts may be created for any or either of the following purposes:
“ 1. To sell lands for the benefit of creditors.
2. To sell, mortgage or lease lands for the benefit of legatees, or for the purpose of satisfying any charge thereon.
“ 3. To receive the rents and profits of lands, and apply them to the use of any person during the life of such person, or for any shorter term, subject to the rules prescribed in the first article of this title.
“ 4. To receive the rents and profits of lands, and to accumulate the same, for the purposes and within the limits prescribed in the first Article of this Title.
“ § 56. A devise of lands to executors or other trustees, to be sold or mortgaged, where the trustees are not also tempowered to receive the rents and profits, shall vest no estate in the trustees; but the trust shall be valid as a power, and the lands shall descend to the heirs or pass to the devisees of the testator, subject to the execution of the power.”
“ § 58. Where an express trust shall be created for any purpose not enumerated in the preceding sections, no estate shall vest in the trustees; but the trust, if directing or authorizing the performance of any act which may be lawfully performed under a power, shall be valid as a power in trust, subject to the provisions in relation to such powers contained in the third article of this title.
“ § 59. In every case where the trust shall be valid as a power, the lands to which the trust relates shall remain in or descend to the persons otherwise entitled, subject to the execution of the trust as a power.”

An express trust is not created to sell or lease lands for the benefit of legatees because there is no positive direction that the executors shall sell the lands, nor is there any direction that the lands be leased for the benefit of legatees. There is no trust under the third subdivision of section 55, because there is no direction to apply the rents and profits to the use of any person during the life of such person. In Cooke v. Platt (98 N. Y. 35) the testator gave all of his estate to his executors absolutely, with “ full power ” to receive the rents, issues and profits, and to sell, mortgage and convey, in their discretion, upon trust, to divide it or its proceeds, after the payment of his debts, among his four children in equal proportions. It was held in that case: “ The main purpose of the testator was to give his estate remaining after payment of his debts equally to his four children. He imposed upon his executors the duty of making the division, and this was the declared purpose of the trust. If there was nothing further in the will there could be no question. The statute does not authorize the creation of a trust for the partition of lands. But a power may be created for this purpose and the devise to the executors, though void as a trust, may be valid as a power to divide and distribute.” It was held that in order to establish a valid trust under the first or second subdivision of section 55 that there must be an absolute and imperative direction to the executor to sell the land. In other words, it was held that unless the will converts the realty into personalty out and out no valid trust under the first or second subdivision of the section is established.

On the face of the will it is plain that the testator intended not to require his executors to sell the real estate but to permit them to sell it and divide the proceeds, or to divide the real estate among the devisees. Under such circumstances there is not a conversion of the realty into personalty. (Cooke v. Platt, 98 N. Y. 36; Scholle v. Seholle, 113 id. 261; Clift v. Moses, 44 Hun. 312; S. C., 116 N. Y. 144.) The Court of Chancery of New Jersey has decided that this will does not convert the realty into personalty. (Story v. Palmer, 46 N. J. Eq. 1.)

In Morse v. Morse (85 N. Y. 53) the will related to a farm of 150 acres which was incapable of being divided into six parcels of twenty-five acres each without substantially destroying the value of the property, and it was held under the circumstances that the testator must have intended that his land should be converted into' money. There was not in that will, as in this, power given to the executors to divide the realty as such among the beneficiaries.

'Whether a power to sell realty is an absolute legal bar to an action to partition has been considered and determined by this court in the negative. (Mellen v. Banning, 72 Hun, 176), and we see no occasion for rediscussing the question. All of the beneficiaries except Mrs. Paret desire that the land be partitioned or sold as may be for the best interest of the devisees. Two of them are plaintiffs and one is a defendant making no defense. The executors also desire that the land be partitioned or sold under the direction of the court. It is apparent that the sisters are not agreed as to the management or distribution of the estate, and it may not be unwise for these executors to ask that the property be sold or divided under the direction of the court rather than to assume to divide or sell it on their own judgment.

It would seem that Mrs. Paret’s’ interests would be best served by a partition of the realty, or a sale and division of the avails, to the end that the trust for her benefit may be established, her income made reasonably certain and it be known what amount is to go to her issue on her death.

"We think, under the facts proven, that the power of sale is not an equitable reason for denying a judicial partition or sale of the land.

It is urged that the executors, as such, are necessary parties to this action. That defect, if it be one, appears upon tiie face of the complaint, and, not having been taken by demurrer or answer, is waived, and cannot be insisted upon as matter of right. (Code Civ. Proc. § 499.) A defect of parties not pleaded is seldom a sufficient ground for dismissing an equity action (Pondir v. N. Y., L. E. & W. R. R. Co., 72 Hun, 384), and in this case the question can be easily obviated by an amendment.

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

Parker, J., concurred; Yan Brunt, P. J., concurred in result.

Judgment reversed, new trial granted, with costs to appellants to abide event.


source: Caselaw Access Project

author: Pollett, J.:

license: Public Domain

text:
    The People of the State of New York ex rel. The Equitable Gas Light Company, Respondent, v. Edward P. Barker and Others, as Commissioners of Taxes and Assessments in the City of New York, Appellants.

      Assessment of corporate property ■ — debts must be deducted — realty and personalty separately assessed — chapter 269 of the Icms of 1880 applicable to assessments under section 821 of chapter 410 of 1882 — certiora/ri, when no proof is necessa/i'y under it ■ — ■ dividends of a corporation, evidence but not proof of its earning power.

    In estimating the amount of personalty of a corporation for the purposes of taxation, the just debts of the corporation must be deducted.
    The commissioners of taxes and assessments of the city of New York are required to value property for the purposes of taxation at its true value; and upon a review of the assessment upon the personal property of a corporation for the purpose of taxation, they cannot be heard to say that their sworn valuation of the real estate of the corporation was much less than its true value.
    The realty and personalty of a corporation are to be separately assessed by the commissioners of taxes and assessments of the city or New York for the purpose of taxation; and if the personalty be overvalued, and the realty undervalued, the valuation of the personalty cannot be sustained on the theory that tlie undervaluation of the realty equals or exceeds the overvaluation of the personalty.
    The remedy provided by chapter 269 of the Laws of 1880 is applicable to assessments made in the city of New York, notwithstanding section 821 of the Consolidation Act (Chap. 410 of 1882).
    Where, upon the return of a writ of certiorari there is no dispute as to the facts, there is no occasion for taking testimony before the court or before a referee, and it becomes the duty of the court to determine the question between the parties.
    Dividends are not proof, but they are competent evidence upon the question of the earning power of corporate property, which is a feature to be considered in valuing such property for the purposes of taxation.
    Appeal by the defendants, Edward P. Barker and others, as commissioners of taxes and assessments in the eity of New York, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 12th day of March, 1894, adjudging the action of the defendants in assessing and fixing a personal tax upon the relator for the year 1893 to be illegal, reversing and vacating the same, and directing the repayment to the relator of any money that may have been paid by it upon the same.

      William H. Glcvrh, for the appellants.

      Gouclert Bros., for the respondent.
   Pollett, J.:

The Equitable Gas Light Company of the city of New York is a corporation organized under the laws of this State, with a capital stock of $4,000,000, on which, in 1890 and in 1892, it paid dividends of eight per cent out of its earnings. The amount of the dividends paid in 1891 and during the years previous to 1890, is'not disclosed by the record.

In 1893 the commissioners of taxes and assessments

valued the real estate of the corporation at....... $1, 527, 300‘

Patents and franchises........................... 500,000

Total................................... $2, 027, 300

They deducted this sum from $4,000,000, the capital stock, which left a remainder of $1,972,700, the value of the personalty of the corporation, upon which an assessment was laid. No deduction was made for the debts of the corporation. On the 9th of March, 1893,. the corporation filed a verified statement with the tax commissioners, showing that the total value of its personalty was $1,041,483.43. This valuation included patent rights and franchises, valued at $500,000, which, deducted from the total valuation of the personalty, left $541,483.43. The statement also showed that the indebtedness of the corporation amounted to $2,839,192.98, which left no personalty liable to assessment. The commissioners refused to deduct any sum from their valuation of the personalty — $1,972,700 — and laid a tax thereon.

In estimating the amount of the personalty of a corporation for the purposes of taxation, the just debts of the corporation must be deducted. (People ex rel. Second Ave. R. R. Co. v. Barker, 72 Hun, 126; affd., 141 N. Y. 196.) The corporation, feeling aggrieved, obtained a writ of certiorari returnable at a Special Term, for the purpose of procuring the assessment on personalty to be vacated. The writ having been made returnable at Special Term in the first instance, we assume that the proceeding was taken under chapter 269, Laws of 1880, and not pursuant to section 821 of the Consolidation Act. The 10th section of chapter 269 provides:

§ 10. This act shall not be construed to repeal or abridge any other right or remedy given to review an assessment by any law applicable to any city or incorporated village, or by the charters thereof.”

It has been assumed in the cases that the remedy provided by chapter 269, Laws of 1880, is applicable to assessments made in the city of New York, notwithstanding the section above quoted and section 821 of the Consolidation Act. (People ex rel. Mutual Union Tel. Co. v. Commissioners of Taxes, 99 N. Y. 254; People v. Wall Street Bank, 39 Hun, 525.) Other cases might be cited in which assessments made in the city of New York have been reviewed under the act of 1880.

The 4th section of chapter 269, Laws of 1880, provides:

“ § 4. If it shall appear by the return to such writ that the assessment complained of is illegal, erroneous or unequal, for any of the reasons alleged in the petition, the court shall have jiower to order such assessment, if illegal, to be stricken from the roll, or, if erroneous or unequal, to order a reassessment of the property of the petitioner, or the correction of such assessment, in whole or in part, in such manner as shall be in accordance with law, or as shall make it conform to the valuations and assessments applied to other real or personal property in the same roll, and secure equality of assessment. If, upon the hearing, it shall appear to the court that testimony is necessary for the proper disposition of the matter, the cburt may take evidence or may appoint a referee to take such evidence as the court may direct, and report the same to the court, and such testimony shall constitute a part of the proceedings upon which the determination of the court shall be made.”

By the return filed by the commissioners no issue of fact is raised, hut, on the contrary, they returned: “ After receiving the statement submitted by the relator, tlie Commissioners of Taxes and Assessments ■carefully considered the same and accepted as true all of the statements of fact therein contained, and decided that the capital stock of the relator was unimpaired, and that the said capital stock was worth the sum of four million ($4,000,000) dollars.”

The statement referred to was verified March 9, 1893, by the relator’s vice-president, and contained an itemized statement of all its property, each item thereof being valued, and of its liabilities. The truth of this statement being admitted, there was no occasion for taking testimony before the court or before a referee, but it became the duty of the court to determine, as it did, the questions between the parties on the return, and it is now too late to urge that the relator should have given testimony in support of its application to be relieved from the assessment complained of. It is also urged that the tax commissioners were not concluded by the statement, but were at liberty to disbelieve, it. That may be, but this position is without force in this litigation because they returned, under oath, that they did believe the statement, and accepted it ■as true.

Gas mains are assessable as real estate. (§ 2, title 1, chap. 13, part 1, R. S., as amended by chap. 293, Laws 1881; People ex rel. Keystone Gas Co. v. Martin, 48 Hun, 193.) The tax commissioners are required to assess real estate at the sum for which such property under ordinary circumstances would sell. (§ 814, Consol. Act.) In other words, .they are required to value property, for the purposes of taxation, at its true value, aud they cannot now be heard to say that their sworn valuation of the real estate was much less than its true value.

It is urged that the dividends paid are proof that the value of the property of the corporation was equal to the par value of its stock. Dividends are not proof of the earning power of corporate property, for sometimes, too often it is feared, they are paid out of money borrowed, but they are competent evidence upon the question what is the earning power of corporate property, which is a feature to be considered in valuing such property for the purposes of taxation. Aside from the refusal of the commissioners to take into account the liabilities of the corporation in determining the amount which it should be assessed for personalty, the vice, if any there be in their proceedings, consists in valuing the plant of the corporation— its real estate- — at $1,527,300, which appears to have been capable of earning an annual dividend of eight per cent on $1,000,000. Realty and personalty are to be separately assessed, and if personalty be overvalued and realty undervalued, the valuation of the personalty cannot be sustained on the theory that the undervaluation of the realty equals or exceeds the overvaluation of the personalty. (People ex rel. Second Ave. R. R. Co. v. Banker, supra.)

The order should be affirmed, with fifty dollars costs and disbursements.

O’Brien and Parker, JJ., concurred.

Order affirmed, with fifty dollars costs and disbursements.


author: Parker, J.:

text:
    In the Matter of the Judicial Settlement of the Account of Charles T. Harbeck and Others, as Executors and Trustees, etc., of Ella S. Flagg, Deceased, Appellants.

      Meeeutors and trustees — manual clerical duties of — right to employ clerical assistants.

    Executors, administrators and trustees are not only bound to assume the responsibility of their office and exercise a proper discretion, but must also perform, within reasonable limits, the actual manual labor requisite to the due execution of the trust.
    There are many instances where the necessary expense of employing clerks and bookkeepers should be allowed to administrators, executors and trustees, but they are only authorized to make such expenditure in cases where the employment of assistance is a matter of necessity.
    The practice of an executor, administrator or trustee in his own affairs cannot be ,taken as a guide for the court as to the necessity of employing a bookkeeper.
    Appeal by Charles T. Harbeck and others, as executors and trustees, etc., of Ella S. Flagg, deceased, from a decree of the Surrogate’s Court of the county of New York, entered in the office of the clerk of said court on the 3d day of May, 1893, surcharging the account of the appellants as executors and trustees with an amount-paid by them for clerical services.

      J. Treckoell Richards, for executors, etc., appellants.

      Samuel S. Thomas, for the respondent, Herbert Harbeck Flagg.
   Parker, J.:

The appellants, as executors and trustees of an estate valued at $90,000, paid to a bookkeeper for keeping the accounts of the estate the sum of $100 per year. Upon the judicial settlement of their accounts, objection was made to such payments by the special guardian of an infant cestui que trust.

Subsequent proceedings resulted in a decree surcharging the trustees’ account in such respect. The result of our examination of the evidence, and a consideration of the arguments of counsel,, have persuaded us that the decree should be affirmed.

Undoubtedly there are many instances where the necessary expense of employing clerks and bookkeepers should be allowed to administrators, executors and trustees. Indeed, the courts have been careful not to insist that so much clerical work should be either" personally performed by an administrator, executor or trustee, or paid for by him, as to make the acceptance of such a position impossible without considerable personal loss. Care has also been observed to limit the authorization of such expenditure by executors and trustees to cases where employment of assistance seems a matter of necessity, and not to so extend it as to create the impression that the only duty which the law devolves upon such an officer is to-employ persons to perform all of the various duties necessary to the conduct of the trust undertaken. While the estate in the hands of these trustees was not a small one, it is difficult to conceive of a case in which either executors or trustees could hare had less work to do, and a smaller number of entries to make in the course of a year, than was required in its management.

If these trustees could be relieved from doing the small amount of work required to receive the income and keep an account of it, it is not easy to conceive of a case in which an executor or trustee would not be justified in asking some measure of compensation for a bookkeeper or clerk.

It is true that the appellant trustees are men of large affairs, and accustomed to employ men to keep their books and take charge of such details as the conduct of this estaté required. And in employing this bookkeeper and fixing his compensation, they did in the matter of this estate, apparently, precisely as they would have done in the management of their own affairs. But their practice in such respect cannot be accepted as the guide for the court.

The fact that they are busy men and have not as much time to give to the management of estates as other individuals, cannot be permitted to affect the legal rule, which must be applied and enforced whenever a question is presented touching the propriety or legality of the expenditure of the moneys of an estate.

The general rule is that administrators, executors and trustees are not only bound to assume the responsibilities and exercise the discretions of their office, but must also perform within reasonable limits the actual manual labor requisite to the due execution of the trust.

The surrogate’s decree, tested by this rule, is right and should be affirmed, with costs.

Van Brunt, P. J,, and Barrett, J., concurred.’

Decree affirmed, with costs.


author: Parker, J.: O’Brien, J.:

text:
    Louis Greve, Respondent, v. Ætna Live Stock Insurance Company, Appellant.

      Waiver of the statutory provision as to the place of trial of an action ■ — ■ insurance policy.

    The purpose of the statute prescribing the place of trial of actions brought in the Supreme Court is to further the convenience of litigants, and the benefits assured thereby may be waived.
    The provision in a policy of insurance that any suit or action, at law or in equity, for the recovery of any claim or the enforcement thereof thereunder, should be brought and maintained and should be sustainable only in the courts óf a certain county of the State, and that in any suit, action or proceeding for the recovery or enforcement of any claim whatever, under any certificate or policy issued by the insurer, the place of trial should be in such county, is not in contravention of public policy, is binding upon the parties and will be enforced.
    Appeal by the defendant, Etna Live Stock Insurance Company, -from an interlocutory judgment of the Supreme Court in favor of -the plaintiff, entered in the office of the clerk of the county of New York on the 8th day of March, 1894, upon the decision of the court rendered at the New York Special Term sustaining the plaintiff’s demurrer to the new matter contained in the defendant’s answer.

      T. W. McArthur, for the appellant.

      Robert G-oeller, for the respondent.
   Parker, J.:

This action is brought on a policy of insurance, the venue being laid in New York county. The answer alleged, as one of its defenses, that the policy of insurance upon which the action was based provided: “ This policy of insurance is a contract made and to be performed in Glens Falls, Warren county, New York, and should be construed only according to the laws of the State of New York and the company’s articles of incorporation; and any suit or action, at law or in equity, for the recovery of any claim or enforcement thereof hereunder, shall be brought and maintained and shall be sustainable only in the courts of said Warren county, State of New York; and in any suit, action or proceeding for the recovery or enforcement of any claim whatever, under any certificate or policy issued by said company, the place of trial shall be in the said county of Warren,-State of New York.”

To this defense plaintiff interposed a demurrei’, which was sustained at Special Term; whether rightly, presents the only question on this appeal.

The position of the plaintiff was, and is, that while he became a party to a contract which provided that any suit to enforce it should be brought in the courts of Warren county, he is not bound by it, or rather that the court is not bound by it, because it contained an agreement in advance to oust the court of jurisdiction. And if the court for that reason refuses to recognize the agreement and retains the case for trial in the county where plaintiff lived and caused the venue to be laid, the result desired will be as effectually accomplished.

Our attention has not been called to any decisions in this State where the court has considered whether the stipulation of the parties will be permitted to determine the place of trial of actions.

The question has received some attention in other jurisdictions, .and without exception the decisions either directly sustain or tend •to support the position taken by the court at Special Term. (Nute v. Hamilton Mut. Ins. Co., 6 Gray, 174; Hall v. People's Mutual Fire Ins. Co., Id. 185; Amesbury v. Bowditch Mut. Fire Ins. Co., Id. 596; Boynton v. Middlesex Fire Ins. Co., 4 Metc. 212; Reichard v. Manhattan Life Ins. Co., 31 Mo. 518; Guarantee Trust Co. v. Green Cove R. R. Co., 139 U. S. 137; Home Ins. Co. v. Morse, 20 Wall. 445; Greenhood Pub. Pol. 466; Crane v. French, 38 Miss. 503.)

Unless there are substantial grounds of public policy requiring that the courts shall refuse to recognize or enforce the stipulation ■of parties naming the counties in which such litigation as may arise out of the contract shall be tried, I see no sufficient reason for denying the right of parties to make and enforce such an agreement.

In the leading case in support of respondent’s position (Nute v. H. M. I. Co., supra), the court introduced its discussion of the .question of public policy as follows :

“We place no great reliance upon considerations of public policy, though, as far as they go, we think they are opposed to the admis.-sion of such a defense.”

While on this appeal the views of counsel upon the question involved were presented with much care, whether the contract is ■one against public policy was given but a passing notice.

From such attention as we have been able to give to the question, it does not seem to us so manifestly against a sound public policy as to make it the duty of the court to,ref use enforcement of the stipulation in the contract relating to the place of trial.

■ The suggestion that the court should resent this attempt to oust it ■ of jurisdiction is unworthy of extended notice. The Supreme ■Court which administers justice in Warren county is the same Supreme Court as the one having general jurisdiction in law and ■ equity in New York county.

The Legislature has not the power to deprive the Supreme Court ■ of any portion of its jurisdiction, but it would not be pretended for a moment that when it prescribed and limited the counties within which a resident plaintiff might bring his action, that it was ousting ■the Supreme Court of jurisdiction because but for the restriction -.the action might be brought in some other county.

The further reason assigned is that the statute determines the counties in which an action shall be commenced, and the agreement of parties cannot be permitted to have the effect of a repeal of the statute for their benefit.

The purpose which the statute has in view is to further the convenience of parties, and the benefits assured by statute may be waived as readily as other rights.

The argument of the court in Matter of N. Y., L. & W. R. Co. (98 N. Y. 447) conclusively disposes of this question. In that case the owner of certain real estate which the corporation desired to acquire for railroad purposes entered into a contract with it, by which she agreed to sell and convey the premises, and the corporation agreed to purchase for a price to be ascertained in proceedings to be instituted by the corporation under the General Railroad Act.

The agreement named the commissioners who it was stipulated should be appointed in the proceedings. It reserved all rights of appeal given by law in such proceedings. Subsequently such proceedings were instituted; the persons named in the agreement were appointed as commissioners ; a hearing was had and a report made from which an appeal was taken to the General Term, which reversed the award and ordered a new appraisal, but refused to appoint new commissioners on the ground that the court has not the power. From that portion of the order refusing to appoint new commissioners an appeal was taken to the Court of Appeals. That court affirmed the order, and in the course of its opinion said:

“ But the agreement of the parties bound them and concluded the court in that proceeding, and the court was bound as between the parties to observe, enforce and carry out the agreement. Parties by their stipulations may irf many ways make the law for any legal proceeding to which they are parties, which not only binds them, but which the courts are bound to enforce. They may stipulate away statutory and even constitutional rights. They may stipulate for shorter limitations of time for bringing actions for the breach of contracts than are prescribed by the statutes, such limitations being frequently found in insurance policies. They may. stipulate that the decision of a court shall be final, and thus waive the right of appeal; and all such stipulations not unreasonable, not against good morals or sound public policy, have been and will be enforced; and generally all stipulations made by parties for tbe government of their conduct, or the control of their rights, in the trial of a cause, or the conduct of a litigation, are enforced by the courts.”

' The order sustaining the demurrer and the interlocutory judgment entered thereon should be reversed, with costs and printing disbursements, and the demurrer overruled, with costs.

O’Brien, J.:

Unless contrary to public policy or good morals courts will enforce contracts as made by the parties when reasonable and enforcible without public inconvenience.

A stipulation or condition by a resident not to bring suit outside a particular county is not opposed to public policy or good morals. "Whether reasonable or enforcible without great inconvenience will depend on the facts ajipearing.

Here the condition is not assailed for fraud or mistake, it being conceded by the demurrer that the contract was deliberately entered into without fraud or mistake.

Conditions ousting courts of jurisdiction or enforcible at the expense of great public inconvenience have been declared inoperative. A condition such as is here involved has never been judicially condemned in this State, and I think it would be going too far to hold that parties may not freely and fairly enter into a contract which is not shown to be either unconscionable, unreasonable, contrary to public policy or good morals and thereafter have it enforced as made. I, therefore, concur with Mr. Justice Parker.

Eollett, J., not voting.

Order sustaining demurrer and interlocutory judgment entered thereon reversed, with costs and disbursements, and the demurrer overruled, with costs.


text:
    New York Security and Trust Company, Respondent, v. Walton Storm, Appellant, Impleaded with The Manhattan Athletic Club and Others, Defendants.

      Promissory note defined — indorsement of a non-negotiable promissory note — complaint in an action thereon, sufficient to charge ihe indorser with liability — effect of a seal — effect of a pledge of collateral.

    A promissory note is a written engagement by one person to pay absolutely and unconditionally to another person therein named, or to his order, or to the bearer, a certain sum of money at a specified time, or on demand, or at sight.
    The payee or holder of a non-negotiable promissory note may charge a person who puts his name on the back thereof as either maker or guarantor according to the actual intention of the person indorsing the same.
    No contract of indorsement in a legal sense can be presumed from the position of a person’s name upon the back of a non-negotiable promissory note, but, as he must have intended to bind himself in some capacity, his contract will be construed to be that of either co-maker or guarantor of the maker.
    The complaint in an action upon a written instrument alleged that the defendant corporation, for value received, at a certain date, duly executed and delivered to the plaintiff a promissory note, of which the following is a copy:
    “ §25,000. New York, July 25th, 1892.
    “ Six months after date, without grace, we promise to pay to the New York Security & Trust Co. at the office of said company in the city of New York, twenty-five thousand dollars, for value received,” etc., etc. (Then follow the ordinary clauses in a collateral note.)
    “THE MANHATTAN ATHLETIC CLUB,
    “ [seal.] By Geo. W. Carr,

      “ President.”

    That prior to the delivery of the note the defendant Storm and others, for a valuable consideration and for the purpose of inducing the plaintiff to make said advance and to accept the said note, placed their names upon, and delivered to the plaintiff, said note so indorsed, in order to secure payment thereof to the plaintiff, and for the purpose of becoming liable to the plaintiff for such payment, and said defendants thereby became liable to the plaintiff for the payment thereof. That the plaintiff relied upon the obligations of the defendants, and was thereby induced to and did, therefore, make the said advance and accept said note.
    That thereafter the note was delivered to the plaintiff, which has ever since been the legal holder and owner thereQf for value.

      Held, that the instrument was a non-negotiable promissory note;
    That the mere fact that the word “seal” was written in the complaint opposite the name of the corporation signing the note was not sufficient to change its character as a promissory note, when the clauses therein pledging collateral repeatedly described the instrument as a note;
    That the fact that the instrument contained clauses pledging collateral to secure its payment was not inconsistent with its character as a promissory note;
    That the allegations of the complaint were sufficient to charge the persons indorsing the note with liability thereunder.

      Ocrnley v. Oostello (15 Hun, 303), distinguished.
    Appeal by tlie defendant, Walton Storm, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 16th day of March, 1894, upon the decision of the court, rendered at the New York Special Term, overruling the demurrers of certain of the defendants to the complaint, and also from the decision and order of the New York Special Term, entered in said clerk’s office on the 5th day of March, 1894, overruling the demurrers to the complaint and directing judgment.

      Samuel JR. Taylor, for the appellant.

      Howard A. Taylor, for the respondent.
   Parker, J.:

The complaint to which the defendant Storm had demurred upon the grounds which will be later considered, alleges in substance that the defendant corporation, for value received, at a certain date, duly executed and delivered to the plaintiff a promissory note, of which a copy, with the names and indorsements on the back, is as follows:

“ $25,000. New York, July 25th, 1892.
“ Six months after date, without grace, we promise to pay to the New York Security & Trust Co., at the office of said company in the city of New York, twenty-five thousand dollars, for value received,” etc., etc. (here follow the ordinary clauses in a collateral note).
“ THE MANHATTAN ATHLETIC CLUB,
“ [seal.] By (Leo. W. Carr,
“ President.”

That prior to the delivery of the note the defendant Storm and ten other individuals, for valuable consideration, and for the purpose of inducing plaintiff to make said advance and accept said note, placed-their names upon and delivered to plaintiff said note so indorsed in order to secure payment thereof to the plaintiff, and for the purpose of becoming liable to the plaintiff for such payment, and said defendants thereby became liable to the plaintiff for the payment thereof. That plaintiff relied upon the obligations of the defendants and was thereby induced to, and, therefore, did make said advance and accept said note.” That thereafter the note was delivered to the plaintiff, which has ever since been the legal holder and owner thereof for value.

It is evident the instrument is not a negotiable promissory note. That it is a non-negotiable promissory note seems equally clear.

Daniel in his work on Negotiable Instruments (Yol. 1, § 28) defines a promissory note as “ an open promise in writing -by,one person to pay another person therein named, or to his order, or to bearer, a specified sum of money absolutely and at all events.”

In Hall v. Farmer (5 Den. 484) a promissory note is stated to be “A written engagement by one person to pay absolutely and unconditionally to another person therein named, or to his order, or to the bearer, -a certain sum of money at a specified time, or on demand, or at sight.”

The appellant, however, insists that while this writing may contain all of the essentials of a promissory note, it also includes certain other elements wfidcli effectually deprive it of that character.

First. Because upon the face of the instrument there is a seal.

The copy of the note set up in the complaint contains the word seal, but there is no other reference to it in the pleadings either to show whose seal it was, or by whose authority affixed, nor does the note itself contain any reference to the seal.

It may be further said that the note contains affirmative evidence that the parties to it did not intend to take away from it the character of a promissory note, because in the clauses, which we liavfe refrained from quoting because of their length,-.and which are of the same general character as those usually found in collateral notes, the instrument repeatedly describes itself as a note. Under these circumstances it cannot be said that the mere appearance of the seal operates to deprive it of its character as a promissory note. (Weeks v. Esler, 68 Hun, 518; Chase Nat. Bank v. Faurot, 72 id. 373.)

Second. It contains a provision pledging collateral, and for the substitution of other collateral under certain conditions. These clauses are usually found in notes secured by collateral, and do not change the character of the instrument. '(See cases cited in 1 Daniel Neg. Inst. § 28.)

One of the grounds of demurrer is that the complaint does not state facts sufficient to constitute a cause of action against the defendant Storm. As to notes not negotiable in form, it has been regarded since the decision in Richards v. Warring (1 Keyes, 576) and Cromwell v. Hewitt (40 N. Y. 491) as authoritatively settled in this State that the payee or holder may charge the party who puts his name on the back of the note as either maker or guarantor, according to the actual intention. These cases substantially proceed upon the principle that as to notes not negotiable no contract of indorsement in a legal sense can be presumed from the position of a person’s name upon the back of the notes, and as he must have intended to bind himself in some capacity the court will construe his contract to be that of either co-maker or guarantor of the maker.

The effect of these decisions, it will be observed, is to hold him who writes his name upon the back of a non-negotiable note, to a greater, or at least different, liability than were he an indorser on a note negotiable in form. For in the latter case he only agrees that he will pay the note to the holder on receiving due notice that the maker, upon a demand made at the proper time and place, has neglected to pay it — while in the first case he is treated as co-maker with, or guarantor of, the maker, and not entitled to notice of demand and non-payment by the maker in order to charge him with liability.

These decisions have been subjected to some criticism in other jurisdictions, but not in this State, at least by the court of last resort, and they are, of course, controlling.

In the Richards case a l'ecovery was sustained against George O. Warring, who wrote his name upon the back of a note, which read as follows:

“ One year after date we promise to pay Platt Richards eight hundred dollars, with interest.
“Yalue received.
“ Amsterdam, April 1st, 1857.
“JAMES E. WARRING.
“JAMES B. CHAPMAN.”

The referee found that: “ On the 6th of April, 1857, James E. Warring and James B. Chapman made the note in suit, and on the same day, before delivering the same to the payee, James E. Warring took the note to George O. Warring to obtain his signature thereto, and thereupon George O. Warring wrote his name across the back of the same; and that afterwards, on the same day, the note, so signed was delivered by Warring & Chapman to Platt Richards, the payee, and he thereupon advanced to Warring & Chapman the amount of the note on the credit thereof.”

Upon these facts the referee held that George O. Warring signed the note with the intent to become liable to pay the same to the payee, and that the plaintiff was entitled to recover against all the defendants the amount due on the note, and ordered judgment accordingly. In affirming the judgment, Judge Hogeboom, who delivered one of the opinions of the court of last resort, after discussing the relation between Warring and the other parties to the paper, which his signature entailed upon him, said: “ What precise name such a relation entitles him to, it is perhaps not indispensable to determine, as I think a complaint setting out the circumstances under which the note was executed, the manner of the signature, and the intent of the party to become liable thereon, would show a cause of action which would entitle the plaintiff to recover.”

We have referred thus fully to the facts found by the referee, and to the comment of the court touching the allegations in a complaint necessary to charge one who indorses his name upon a nonnegotiable note, because it is claimed that if it be assumed that a complaint could be so framed as to charge the defendant Storm, under the decision in the Richards case, this complaint is nevertheless demurrable because of the insufficiency of its allegations.

Now, turning to that portion of the complaint which we have already quoted, we find alleged not only the circumstances under which the note was executed, and the manner of the signature, but that the defendant wrote his name upon the back of the note in order to secure payment to the plaintiff, and for the purpose of' becoming liable to the plaintiff for such payment, and that thereby he did become liable to the plaintiff.

Without further comment, it is sufficient to say, that under the .Richa/rds case this pleading is ample to charge the defendant with liability on the note. It is not likely that the point would have been made but for Cawley v. Costello (15 Hun, 303), in which the court said: “ The complaint seeks to charge the defendant only as indorser, but the note not being negotiable, the defendant Costello can only be made liable as maker or guarantor; and if the plaintiff seeks to charge the defendant Costello in either of those characters he must aver that he wrote his name on the back of the note with intent to become liable thereon in such character.”

If this decision should be regarded as in conflict with Richards v. Warring and Cromwell v. Hewitt, it would not embarrass us in the disposition of this case, because, while a later decision, it does not of course overrule them. But we think the court did not intend ,to say anything in conflict with the views expressed in those cases which were cited by it in support of the decision made. The additional step taken was doubtless due to the failure of the author of the opinion to keep clearly in mind the different senses in which certain words and terms are used when applied to parties to promissory notes. The complaint, so says the opinion, charged the defendant with being an indorser on the note which was not negotiable; and, the judge having in mind that the legal relation of one who thus writes his name upon the back of a non-negotiable note is not that of an indorser, proceeded with an argument intended to show that a different legal relation must be in effect charged — a proposition undoubtedly sound, and yet that may be done even when it is alleged that the party sought to be charged indorsed the note.

For, in a jfliysical sense, he indorses the note when he writes his name upon the back of it. So, if the allegations of indorsement be accompanied by a history of the circumstances attending the execution and delivery of the note, and a charge that the indorsement was made upon the back with the intent to become liable to the payee thereon, a different legal relation to the other parties to it than that of indorser on a negotiable note is charged.

Ye cannot know precisely what was stated in the complaint, but it was quite evident that it was not alleged that he wrote his name on the back of the note with “ intent to become liable thereon,” for the court asserted the necessity of such an allegation, and caused the words to be italicized in the published opinion.

This was, of course, in accordance with the rule in the Richards case, and required the decision made. But in giving the reason for it, the court, losing sight for the moment of the fact that the word “ indorser ” could be employed in more senses than one, was led to the use of language which will admit of the construction that, in addition to pleading all the facts,,and alleging that the act of indorsement was done with intent to become liable thereby to the payee, the pleader must assert in effect that the-so-called indorser understood the legal relation which he wanted to assume towards the other parties to the note, and, therefore, signed it with intent to become liable thereon as co-maker or surety for the maker, as the case might be.

The proposition needs but to be stated to insure the conviction that such a ruling was not intended, or if intended, that it was error.

There are other grounds of demurrer, but with their consideration at Special Term we are content.

The interlocutory judgment should be affirmed, with costs, but with leave to the defendants to answer within twenty days, upon the payment of the costs in the judgment and of this court.

Nan Brunt, P. J., and Barrett, J., concurred.

Interlocutory judgment affirmed, with costs, with leave to defendants to answer in twenty days, on payment of costs in the judgment and of this court.


author: Barrett, J.: Parker, J.

text:
    Stephen U. Cadwell, Respondent, v. Marks Arnheim, Appellant.

      Damages for injuries — proof of freedom, from, contributory negligence — runaway team, — cktty of the driver to keep to the right.

    In an action brought to recover damages for injuries received from a runaway team of horses, the burden is upon the plaintiff to show his freedom from contributory negligence, but the fact that he continues on the right-hand side of the road, while the runaway team is approaching him on that side, does not establish contributory negligence on his part.
    It is the duty of a driver of a runaway team of horses, when he finds that he cannot stop them, to guide them if possible to the right side of the road, in order to pass a vehicle going in the opposite direction, without a collision.
    *Tlie driver of a vehicle on a road has a right to expect that the driver of a runaway team, traveling in the opposite direction, will make an effort to guide his horses to the right.

      Where horses are running away and are beyond the control of the driver, and the driver uses due diligence and the best of his ability as a skillfm driver to control the horses, and cannot control them, the law of the road as to which side the horses run on after they take fright does not apply.
    Parker, J., dissenting.
    Appeal by tbe defendant, Marks Arnheim, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 8th day of March, 1893, upon the verdict of a jury for $2,500, rendered after a trial at the New York Circuit, and also from an order entered in said clerk’s office on the 5th day of March, 1893, denying the defendant’s motion to set aside the verdict and for a new .trial made upon the minutes.

      O. Fine, for the appellant.

      A. F. Dyett, for the respondent.
   Barrett, J.:

The defendant was not held responsible for the runaway, but for the negligence of his driver in not at the time properly guiding the horses.

The evidence was conflicting upon the point whether horses while running away can be guided to the right or the left. There was enough to go to the jury upon this question, and they found that the defendant’s driver could have averted the collision by guiding his horses to the right.

This is this case in a nutshell. The plaintiff was driving quietly and properly upon the right of the road going south. The defendant’s horses were running away upon the left of the road going north. The plaintiff could not get any further to the right because of the presence of. trees. He in fact was at the extreme right of the road. He could not safely turn to the left. That would have increased his danger. Indeed, it would probably have been fatal in view of the proximity of the defendant’s horses and the speed with which they were approaching. The defendant’s horses were upon the wrong side of the road, dashing forward directly in front of the plaintiff, who was, as we have seen, upon the ‘ proper side. It was plainly the duty of the defendant’s driver, when he found that he could not stop his horses, to guide them, if possible, to the right, and tbus to pass the plaintiff without a collision. As the evidence was sufficient to justify the jury in finding that the defendant’s horses could have been thus guided, and that the driver failed to make a proper effort in that direction, the verdict should not be disturbed.

The evidence failed to substantiate the defendant’s contention that the plaintiff was himself guilty of negligence. On the contrary, the burden of showing freedom from contributory negligence was fairly met by the plaintiff. In fact, there was nothing which, under the circumstances, the plaintiff could possibly do which he did not do. Had he done what the defendant insists he should have done, he would have been far more amenable to criticism. It would have been shockingly bad judgment to risk a turn to the left at such a critical moment, and the result would probably have been far more disastrous than it was. The plaintiff had a right to expect that the defendant’s driver would make an effort to guide his horses to the right. He cannot well be blamed, therefore, for not guiding his own horses in such a way as — had the driver fulfilled his just expectation — would certainly have precipitated a violent and, doubtless, fatal collision.

The exceptions taken by the defendant to the reception and rejection of evidence were, in the main, unimportant. But none of them raises any question of substantial prejudice.

As to the charge, we think the case was fairly and correctly submitted to the jury. The defendant insists that it was error to charge certain of the plaintiff’s propositions to the effect, in substance, that if the defendant’s driver was guilty of negligence “ the plaintiff was entitled to recover.” It is contended that the question of contributory negligence was thus withdrawn from the jury. But it is evident from the entire charge that this was not intended. Nor could the jury have so understood it. The learned judge repeatedly instructed the jury that, if the plaintiff was guilty of contributory negligence, he could not recover. In one part of his charge we find the following statement of the law: “ It is necessary, in order that he recover, that he should satisfy the jury that this collision was caused by negligence on the part of the defendant’s coachman, and that he himself was free from fault, and that his own negligence did not contribute to the accident; and the burden of proof is upon" him to satisfy you upon these points.” In another part of his charge he says: h As I have already stated, it is undoubtedly true, as a matter of law, that a plaintiff who is in fault himself, and who has not exercised ordinary care, cannot recover in a case of this description; and I shall, in this case, leave it to the jury to say whether there was any want of ordinary care on the part of the plaintiff.” And again, in summing up upon the whole case: “ The jury have heard all the testimony and have heard the comments of counsel, and understand the situation, and I will leave it to them to say whether they think the plaintiff failed in exercising ordinary care under the circumstances. If he did not, he cannot recover; but if he did use the ordinary care that is to be expected of a driver under these circumstances, and the coachman was guilty of negligence that brought on the collision, then the plaintiff is entitled to recover.”

It is clear, therefore, that the expression complained of in the plaintiff’s propositions related solely to the legal bearing, upon the defendant’s general responsibility, of the negligence of his driver. Wliat was intended was to convey the idea that if the driver could, with proper effort and diligence, have turned his team to the right and thus avoided the collision, the defendant’s negligence was made out. It must have been entirely clear to the jury that the proposition was in harmony with the learned judge’s colloquial charge, and they must, therefore, have understood that the proviso of that charge with regard to contributory negligence was, as a matter of course, the starting point of these'propositions.

The defendant also complains of the following proposition, which, at the plaintiff’s request, the learned judge charged: “ It is conceded that at the time of the collision between the plaintiff’s team and the defendant’s team, the plaintiff’s team was being driven on the right of the center of the road, in a southerly direction, and the defendant’s team was being driven to the left of the center of the road in a northerly direction.”

It was conceded that the plaintiff’s team was being driven upon the right of the road going south, and that the defendant’s team was running away upon the left going north. The complaint relates to the use of the words “was being driven,” as applicable to the defendant’s team. This complaint seems to be frivolous. The jury could not liave failed to understand what was meant. Indeed, the driver still held the reins, and, in a general sense, was driving — though not as well as he should have driven.

The defendant also urges that the learned judge should not have charged that the defendant’s team was unlawfully and improperly on the left of the center of the road. But that was simply an abstract proposition emphasizing the general law of the road.

The concrete proposition, affecting the case under consideration,, was put to the jury most favorably to the defendant when the learned judge subsequently, at his request, charged as follows: “ That if these were runaway horses, and not under the control of the driver, and the driver used due diligence and the best of his ability as a skillful driver to control the horses, and could not control them, that then the law-of the road as to which side the horses ran on after the fright, the law of the road does not apply.”

So as to the charge with regard to the presumption of negligence attaching to a violation of the law of the road.

This was correct. (S. & JR.. Neg. §§ 13, 650, 651, 652.) But this was also an abstract proposition, as the case was put to the jury solely upon the negligence of the defendant’s driver in not guiding his horses to the right, and thus avoiding a collision, as he might have done.

There are no other points with regard to the charge worthy of special consideration.

We find no error to the prejudice of the defendant; none which would justify a reversal.

The judgment and order denying the defendant’s motion for a new trial should be affirmed, with costs.

Yan Brunt, P. J., concurred.

Parker, J.

(dissenting):

I do not concur in the view that the evidence entitled the plaintiff to go to the jury.

Prior to the runaway, which resulted in serious injury to the-plaintiff’s horses and wagon, defendant’s team had been much used, and had been proved to be gentle, free from fright, and without any kind of fault. Defendant’s driver was a man of large experience-in driving and handling horses, and his competency is not questioned. When defendant’s family started out for one of their accustomed drives through Central Park on the occasion in question, the victoria was in the best of order ; the harness was in good condition ; the horses were properly hitched, and the driver was properly mounted in his seat in the victoria, with the reins well in hand.

TJp to this point, therefore, no basis can be found for charging the defendant with negligence.

But it is said the driver could have averted the collision by guiding his horses to the right, and that because of his failure to thus obey the law of the road the master is liable for the damages which resulted to plaintiff.

If it be the fact that the presence of the runaway horses on the wrong side of the road was due to the fault of the driver the proposition is sound, otherwise not.

As the driver was in great peril, and menaced with frightful possibilities of injury to the occupants of the carriage and himself, whether he was at fault in failing to guide the horses to the right ■cannot be determined by the test which applies where opportunity is afforded for calculation and the exercise of judgment unhampered by fear. But the distinction need not be insisted upon, for, as I view the evidence, if it should be assumed, as the prevailing opinion of the court necessarily does in effect, that defendant is liable if it was within the bounds of possibility for the driver to have guided the team to the right, the plaintiff should not have recovered, because the undisputed evidence was that the driver did liis best to so guide them, and failed.

He said: I was on the right-hand side of the drive at that time going north. The ladies were in the carriage. It was a victoria, and I was on the box. Before the fright I was doing ■and driving as usual. I had hold of the lines in the usual way. I was going down grade a little. That was about Eighty-sixth street, ■and there was a single horse, what I call a trotter, coming up. The trotter was coming south, coming, meeting me, and I don’t know whether the gravel went from the wheels, or from the horse’s foot, it went up on my nigh side horse’s back, and he kicked up, and his leg went over the pole, and they ran away on me. They ran straight as far as the road was straight, and then when they came to the curve, they went to the gutter. I tried with all my might to pull them out of the gutter and could not do it. * * * The trotter was coming down, was coming, meeting me. The trotter was coining to my left. The sand that was thrown up struck the near side horse, the one on the left. It was the horse on the west side that the gravel struck. * * * When the stone or sand struck the horse, I tried to steer them and stop them. I managed my lines with both hands. I kept them on my own side as far as the road went straight, but when they came to the curve, they went straight on for me, and I could not get them out; they went in the gutter, and I pulled them, on the off horse, with all my might, and I could not get them out of there. I pulled and was pulling and doing all that I possibly could all the time to stop them and steer them.”

The witness was not a party to the action. He was in no respect discredited. His testimony was not disputed by any witness either directly or by stating circumstances permitting a contrary inference. But an attempt was made to create an issue of fact by the testimony of so-called experts. They were called upon to testify that runaway horses could be guided.

Before referring to their testimony it should be said that the fact was established beyond controversy that before commencing to run one of the horses got liis leg over the pole, where it remained until after the collision. Jolm B. Harr testified that runaway horses could be guided although it was Impossible to stop them. When asked whether a horse would not try to pull his leg off the pole and thus draw it towards him he answered: “All the horses I ever had over the pole always tried to kick and get the leg back again.” That defendant’s horse did not try to do, and, therefore, this, expert’s experience did not include a similar case.

John S. Ferguson, the only other witness, who gave a similar opinion, said that his personal opinion was confined to four runaways and he admitted that he never had a horse get his leg over the pole.

Plaintiff’s witness Hr. Cattnaeht said: “And it is a fact that a horse, taking fright and getting his right hind leg — off hind leg — over a pole, and still laboring under the fright, will pull with an effort to get his leg from over the pole- — will so pull in a direction opposite to the pole. Q. Is it not a fact that when a horse does pull in a direction opposite to the pole, the bit in the mouth of the horse will have no control over him, his body will pull the team in a direction opposite to the pole ? A. I never experienced the accident, but I would expect that that would be so. * * * I have seen the leg over the pole, yes, sir. A horse with the leg over the pole; the leg over the pole would goad the other horse to madness * * * and would’ frighten the other horse, you will observe, and that is the way I saw it when I have seen it. * * * 1 have seen* such runaway that could be stopped by the driver, and I have seen where it could not be stopped. It depends on the spirit of the other horse. * * * If a horse has its leg over the pole, the other horse would carry him. * * * His leg which is over the pole would be stretched out towards the other horse to some extent and when he came in contact with the other horse’s leg he would be apt to frighten the other horse. Then the other horse would run. I don’t think that the force, which would take the horse with his leg over the pole along with the carriage off on the right side, would carry the carriage to the right. I don’t think it would, because your dead weight is on the left. * * * I don’t think you could turn him, sir. I don’t think you could turn him to the right. * * * 1 have seen them run a quarter of a mile.”

John Murphy, another witness called by the plaintiff, testified that he had been a park policeman since 1885, and had caught as many runaways as any man in the service. “ It is my experience that when a frightened team is running away with one of the horses having his hind leg over the pole, it is impossible for the driver, no matter how skillful, to control or direct the team with the lines. It is impossible. It is impossible without some assistance, or unless the horse will bring his leg back from over the pole; I have had several cases of it.”

Redirect examination by Mr. Hyett: “ Q. Officer, do you mean that when a horse gets his leg over the pole, that you cannot guide him or that you cannot stop him? A. Yes, sir; I mean that the coachman has no power over him at all. Q. What ? A. I mean that the driver has no power over him at all. Q. How do you mean ? A. No power at all over him, for to pull-them horses up. Q. To pull him up ? A. No. Q. That is the horse will go where you guide him until he gets his leg from- A. Go ? He will kick, he will do mischief, will tumble, everything, he is out of control. I have had so many, I venture to say, as twenty or thirty of them of that kind of runaways.”

It seems to me absurd to say that the opinions of two alleged experts as to the possibility of guiding runaway horses, one of whom never had a case where one of the horses had his leg over the pole, and the horses of the other had always kicked to get off; the pole, puts in issue the positive testimony of the driver that he tried with all his strength to guide the horses to the right.

If this position be right defendant’s motion to dismiss the complaint should have been granted. But, assuming that the driver’s testimony of what was done was put in issue by Barr and Ferguson’s opinions as to what can generally be done, still a new trial should be granted because of the refusal of the court to grant a new trial on the ground that the verdict was against the weight of evidence.

Against Barr’s and Ferguson’s opinions were pitted not only the opinions of plaintiffs witnesses, Dr. Cattnacht and John Murphy, to which reference has already been made, but also the opinion of other witnesses of equal or greater experience. George B. Arnold, a- foreman in a livery stable at 141 East Twenty-third street, and a practical coachman, etc., for twenty-two years, said it is impossible for any driver to stop or control a runaway, frightened team of good horses with one of them having a hind leg over the pole, and that he has had such causes himself.

Henry O. Overin, a livery stable man, now in business in Forty-second street and Seventh avenue, and also on Broadway, between Forty-fifth and Forty-sixth streets, a member of the firm of Overin & Markart, in the business and a practical driver himself for twenty-five years, and one who has had much experience with runaway horses himself, said: “ Horses frightened and running away cannot be managed or controlled or stopped, especially if one of the team has its leg over the pole. Ton cannot guide a runaway horse, even if the leg is not over the pole.” .

.Isaac Strauss testified that he was in the horse business; had driven horses all his life; considered himself a good horseman, and had horses run away with him. "Whether horses running away could be controlled, he said: “ Well, I have never had the experience that I could control a horse when he is frightened, if he loses his head and cannot be controlled. A horse is a good deal stronger than a man; he is a good deal stronger than five men. • Q. When a horse is frightened and is running away, he don’t obey the rein, does he ? A. His mouth becomes numb, and you cannot pull him anywhere; it is impossible. Q. Have you ever seen a case where a team has taken fright and one of the team gets his hind leg over the pole, and that team, in that condition frightened, one leg over the pole, running away ? A. I have, sir.”

Patrick Clark, a dealer in horses at 618 Broadway, American Horse Exchange, and a practical driver of coaches and private teams, had driven first class and valuable horses of all kinds, said : “A pair of runaway horses, able-bodied, good horses, running away from fright, cannot be controlled or stopped by a driver, a skillful, good, competent driver, not by one man. They cannot. I have experienced it.” He further said : “It is impossible for the defendant’s driver, on the facts shown by the defendant in this case, to have stopped or controlled the direction or speed of the defendant’s team.”

Dr. James Haley, a veterinary surgeon, who has driven many and very good horses, and has given much 'attention, made many observations, and had much experience as to runaway horses, and gives instances, said: “From knowledge of horses that I have from my profession of veterinary surgeon, and from my prior and present dealing with horses, and from driving myself, and from observing the driving of both single and double, in my opinion it is not possible for even the most skillful and able driver to control, by way of stopping or directing the motion of a runaway team, which team can trot a mile in about three minutes, when the team is going at the rate of fourteen or fifteen miles an hour, and down a little descent, one of the horses with its leg over the pole, the hind leg over the pole, it is not possible, in my opinion.”

If plaintiff’s expert testimony tended to put in issue the testimony of defendant’s witness describing what was actually done by him in his attempt to control the team, which I deny, still it was so fully met and overborne by other witnesses of equal experience, called by plaintiff and defendant, as to render a finding in hostility to the testimony of Frazin, who was not discredited in any way, clearly against the weight of evidence.

That being the case, it is the duty of the court to reverse the judgment. And I so advise.

Judgment and order affirmed, with costs.


author: Follett, J.:

text:
    The Germ Proof Filter Company, Appellant, v. The Pasteur Chamberland Filter Company, Respondent.

      /Lotion brought to recover damages for slander — complaint — necessa/i'y allegations thereof.

    A. complaint in an action brought to recover damages for slander, which does not allege the particular words spoken by the defendant constituting the slander, and for the uttering of which damages are demanded, is bad.
    Jn actions for slander of title it is necessary for the plaintiff to allege and prove that he owned the property spoken of, and in an action to recover damages for saying that a particular article is not patented, the plaintiff must allege and prove that it was. An allegation that the defendant falsely said that the plaintiff had no title or no patent is not equivalent to an allegation that the plaintiff had title or held a patent.
    In case words are not actionable unless certain circumstances exist, these circumstances must be alleged in the complaint in an action brought to recover damages for slander, in order to state a cause of action.
    Appeal by the plaintiff, The Germ Proof Filter Company, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of New York on the 10th day of March, 1894, upon the dismissal of the complaint directed by the court after a trial at the New York Circuit before ‘the court and a jury.
    The plaintiff is a corporation organized under the laws' of this State, and the defendant is a corporation organized under the laws of the State of Ohio. These corporations are rivals in the business of manufacturing and selling water filters. It is alleged in the complaint that "Whitall, Tatum & Go., a firm engaged in business at New York, Philadelphia and Chicago, were the agents of the plaintiff to sell its water filters through said firm’s salesmen traveling in the United States, Canada, Central and South America, of which the firm had many. It is also alleged:

      “ 6. That defendant is the manufacturer of a certain rival water filter, and that, with the intent and for the purpose of injuring the credit, reputation, business and standing of plaintiff, defendant, by and through its officers, agents and servants, at divers times during the months of May and June, 1891, falsely and maliciously uttered, published and declared to members of the said firm of Whitall, Tatum & Company, and to their agents and servants, and to divers other persons to plaintiff unknown, the following false and defamatory matter, to wit: That plaintiff had infringed the patent of defendant, and had falsely, fraudulently, and, for the purpose of deceiving the public, marked its (to wit, the plaintiff’s) filters with the word ‘ patented ’ when they were not patented, and that the president of the plaintiff would be arrested for falsely marking said filters as aforesaid, and that he (to wit, the president of the plaintiff) had by that time no doubt been arrested, and plaintiff further alleges that the aforesaid statements were false, defamatory and untrue to the knowledge of the defendant.”
    A bill of particulars was served, in which it is stated that the words were spoken at the office of said firm at Chicago May 28, 1891, and at its office at New York on the 12th and 20th of June, 1891. It is alleged that, by reason of the utterances complained of, plaintiff had been greatly injured in its business with the aforesaid firm, which, by reason of the words, had ceased to sell its filters to its damage in the sum of $10,000. When the case was brought to trial it was dismissed before the evidence was taken, on the ground that a cause of action is not stated in the complaint. Upon this order a judgment was entered, from which the plaintiff appeals.

      Charles T. Smilamd, for the appellant.

      William M. Irvine, for the respondent.
   Follett, J.:

The complaint is fatally defective in two particulars: (1) The particular words spoken by defendant’s officers and agents are not alleged, and a complaint which does not set out the words spoken is bad. (Ward v. Clark, 2 Johns. 10; Fox v. Vanderbeck, 5 Cow. 513; Blessing v. Davis, 24 Wend. 100; Finnerty v. Barker, 7 N. Y. Leg. Obs. 316; Forsyth v. Edmiston, 2 Abb. Pr. 430; Cook v. Cox, 3 M. & S. 110; Harris v. Warre, 4 C. P. Div. 128; Towns. S. & L. [4th ed.] § 329; Starkie S. & L. [3d Eng. ed.] 343; Id.-[Wood’s ed.] § 425; Odgers S. & L. 528; 13 Am. & Eng. Ency. of Law, 456; Newell on Defamation, 640, et seq.) Several of tbe cases cited also hold that this defect is not cured by a verdict.

The gravamen of the complaint is that defendant’s officers and agents said that the plaintiff’s filters were an infringement on defendant’s patent, and that they (plaintiff’s filters) were not patented and were falsely marked “ patented.” It is not alleged that plaintiff’s filter was patented. In actions for slander of title it is necessary for the plaintiff to allege and prove that he owned the property spoken of, and in an action to recover damages for saying that a particular article is not patented the plaintiff must allege and prove that it was. Amallegation that defendant falsely said that plaintiff had no title or no patent is not equivalent to an allegation that plaintiff had title or held a patent. In case words are not actionable unless certain circumstances exist, these circumstances must be alleged in order to state a cause of action.

The count (eighth) for malicious prosecution need not be considered, for it is not alleged that the action complained of has been terminated in the plaintiff’s favor.

Without considering the other questions raised, we think the complaint was rightly dismissed on the ground that no cause of action is stated therein.

The judgment should be affirmed, with costs.

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

Judgment affirmed, with costs.


text:
    Walter Hamilton, as Trustee for Florence H. Hamilton and Others, Plaintiff, v. Ferral C. Dininny, Jr., Defendant.

      Pleadings — right of a plaintiff to rely upon admissions contained in the answer— waiver of the right to object, upon appeal, to a constmction given to the pleadings by the trial court.

    The plaintiff has a right, upon the trial of an action,.to rely upon the admissions contained in the answer as establishing a proposition in his favor, and to omit making preparations to prove the fact therein admitted.
    Where the plaintiff, upon the trial of an action, acquiesces in the construction ' the court gives to the pleadings therein, he cannot, upon an appeal from the judgment rendered against him in such action, obtain a reversal thereof on the ground that the pleadings were erroneously construed by the trial court.
    Motion by tbe plaintiff, Walter Hamilton, as trustee for Florence H- Hamilton and others, for a new trial on a case containing exceptions, ordered to be heard at the General Term in the first instance upon the dismissal of the complaint, directed by the court after a trial at the New York Circuit, before the court and a jury, on the 11th day of January, 1891.

      Wm. H. Arnoux, for the plaintiff.

      M. H. liegensbttrger, for the defendant.
   Parker, J.:

Certain leading facts are established by the pleadings. Briefly stated they are, that Walter Hamilton, either for himself or as trustee for others, on the 3d day of January, 1890, agreed, in consideration of the sum of $12,000, to sell the defendant 150 $1,000 bonds of the Virginia Tide Water Coal Company, and 3,350 shares of the capital stock of said company.

Defendant promised to pay $7,000 in cash or its equivalent, and give his promissory note for the remaining $5,000, payable in four months.

He paid the $7,000 and obtained possession of the bonds and stock, which he still retains. He refused to either give his note for the $5,000 or pay any part of it, and this action was commenced to recover such sum, with interest. Defendant by his answer alleged that Hamilton contracted to do .something more than deliver to him the certificates for the 3,350 shares of stock then in his possession, viz.: That he would deliver to the defendant new certificates therefor to be issued by the company, and that Hamilton failed to perform this part of his contract, which constituted a condition precedent to his right to demand defendant’s note for $5,000. What may be the real merits of the controversy suggested by the pleadings in such respect we are not advised by the record.

Before that stage of the trial had been reached which would call upon the defendant to present the evidence, the complaint was dismissed on the ground that plaintiff had not proved that Walter Hamilton, as trustee of his children, was the owner of the stock and bonds which were the subject of the contract.

That the evidence then before the court warranted the decision made is beyond question. If, then, there was no previous error to which the plaintiff excepted, the judgment must stand.

Before counsel had opened the case on behalf of the plaintiff, counsel for defendant moved to dismiss the complaint, asserting that, according to its allegations, Hamilton personally claimed to have been the owner of the securities and entitled to recover their value, and as he had died since the commencement of the action, it could not be prosecuted further until his executor or administrator should be substituted as plaintiff.

The objection being overruled, the following dialogue between the court and defendant’s counsel ensued :

“ Counsel.— Does your honor hold that the complaint is brought by the plaintiff in his capacity as trustee %
“The Court.— Yes.
“ Counsel.— That is the manner in which the case is to be tried; on that theory ?
“The Court.— Yes. If the word ‘as’ had not appeared before the word ‘ trustee,’ your position would then be sound. It would be a mere deseriptio personae.”

Thus, at the very commencement of the trial, it was determined that the complaint sufficiently alleged the trusteeship of Walter Hamilton. Whether it did or not, the plaintiff is entitled to have the questions presented disposed of as if the averments of the complaint were sufficient in that respect, because but for the ruling an opportunity would have, been afforded to make a motion to amend it.

Immediately after this determination by the court, the plaintiff, in order to establish his case, called a witness who testified to a conversation, in which the defendant in substance admitted that the stock and bonds had been delivered to him.

, The amount of interest due was then proved and plaintiff rested.

Defendant moved to dismiss the complaint upon the ground that the plaintiff had failed to prove the contract alleged in the complaint. Plaintiff insisted that it was admitted by the answer. The court ruled, and, as we think, rightly, that the answer did not admit that the' balance of the purchase price was to be paid upon delivery to the defendant of the stock then in Hamilton’s possession, but, on the contrary, that such allegation was put in issue. An application to reopen the case having been made and granted, the plaintiff introduced in evidence an affidavit made by the defendant, which proved prima facie at least, that the contract was as alleged .in the complaint. Plaintiff again rested, and defendant’s counsel in his motion to dismiss the complaint assigned as a reason that the plaintiff “ has shown no trusteeship as alleged in the complaint.” This position the court held to be well taken, and the plaintiff was compelled to attempt to make proofs of trusteeship. This was error if the allegations of the complaint touching the trusteeship of Hamilton were not put in issue, for it was the right of the plaintiff to rely upon the pleadings as establishing that proposition in his favor, and to omit making preparation to prove the fact.

"While there is opportunity for debate as to whether the answer did create an issue in that respect, a reasonable construction of it would seem to require a determination that the pleader did not intend to raise such an issue, and that he did not in fact. In its statement of the contract it does not differ in substance with the complaint, except in so far as it alleges that Hamilton’s contract was to deliver new stock certificates, which he had not done. It alleges that on the very day of the making of the contract Hamilton produced the certificates for 3,350 shares of stock, every share of which except four stood in the name of Hamilton as trustee. The next paragraph alleges that Hamilton represented the title to the stock to be good, and that his title as trustee protected him from his creditors, and agreed to deliver new certificates issued by the company.

Thus it appears from the answer that at the time of the negotiations defendant knew that the legal title was in Hamilton as trustee, and lie undertook to provide against any possible litigation over the shares by requiring Hamilton to obtain from the company new certificates of shares. Nor did the answer anywhere assert that plaintiff was not as trustee entitled to recover such sum, if any, as-should be found due.

But while we are inclined to the view that plaintiff could have safely rested at that point, and that a dismissal of the complaint had he done so would have been error, plaintiff’s counsel was apparently not of that opinion, for he omitted to take an exception to the ruling of the court, and instead proceeded in an effort to prove the trusteeship. After some further testimony had been taken, the plaintiff again rested, and the motion to dismiss was renewed upon the same ground. In response to the motion, the court announced that “ the plaintiff must prove the possession as trustee of all the stock, and the delivery of all the stock, before he is entitled to recover anything.”

To this ruling plaintiff took no exception, and by permission of the court again proceeded in the attempt to prove that plaintiff had possession as trustee of the stock, and that'lie made delivery of it.

The result of the last effort was the introduction of evidence which we have already taken occasion to say required the decision of the court that plaintiff’s trusteeship had not been established.

Had plaintiff relied upon the pleadings or taken an exception to the ruling of the court, a different situation would be presented.

But, as he acquiesced in the construction which the court gave to the pleadings, he has not now any legal ground of complaint.

The plaintiff’s exceptions should be overruled and judgment ordered for defendant, with costs.

Yan Brunt, P. J., concurred.

Exceptions overruled and judgment ordered for defendant, with costs.