author: Follett, J. :

text:
    Daniel B. Halstead and Another, as Executors, etc., of Caleb D. Gildersleeve, Deceased, Plaintiffs, v. Henry S. Ives and Others, Defendants.

      ■General assignment — composition with creditors — scope of a decree of the court -upon the assigneds final accounting — evidence as to a release of the debtor’s entire liability, as a bar to an action by a creditor upon his debt.

    No power is conferred upon the; court by tlie provisions of the General Assignment Act relating to compositions with creditors (Laws of 1877, chap. 466, § 20, subd. 6), to determine on a final accounting by the assignee thereunder, that a compounding creditor has released the assignor from all liability on his debt, and an adjudication to that effect in such a proceeding is void and of no effect.
    If a creditor executes or assents to a composition executed by other creditors of a general assignor, by which the debtor is discharged from his debt, such discharge, if pleaded as a bar to an action brought on the debt, must be established by producing it, if in writing ; the recital in a. decree, of the court, made in a proceeding under the statute for a final accounting- by the assignee after such composition, to the effect that the creditor had so executed or assented to the composition, is not evidence of the fact.
    'The doctrine, that an oral agreement between several creditors and their debtor to compound and discharge their claims is valid, cannot be invoked where there is no legal evidence of any composition or release before the court.
    ■Upon an issue litigated between a creditor and his debtor as to whether the debt in suit had been released and discharged, evidence that after the alleged release the debtor recognized the right of the creditor to apply upon the debt the proceeds of collateral security held by him, is relevant.
    Motion by tlie plaintiffs, Daniel B. Halstead and George Gilder-sleeve, as executors of Caleb D. Gildersleeve, deceased, to set aside a verdict directed for tlie defendants and for a new trial, made on a case containing exceptions ordered to be beard in the first instance at tlie General Term, by an order made at tlie New York Circuit on tlie 15th day of May, 1893.
    This action was brought to recover on a promissory note, made ■July 5, 1887, by the defendants under their firm name of Ilenry H. Ives & Co., whereby they promised to pay to the order of Caleb D. Gildersleeve $15,000 on demand, with interest.
    Tlie only defense interposed is that on the 8th day of March, 1890, tlie defendants entered into a composition with some of their creditors whereby the latter agreed to discharge tlie former from all liabilities of every kind and nature; tliat thereafter the plaintiffs’ testator assented to said composition, and July 17, 1890, accepted $881.37, being five per cent on the amount of his claim as established on the accounting, in full of the note in suit, and thereupon the defendants were released and discharged from all liability thereon.
    August 11, 1887, Ilenry S. Ives & Oo., being insolvent, made a general assignment of their firm and individual property for the benefit of creditors.
    March 14, 1890, the assignee petitioned for a final accounting, and on the fifth of May following a referee was appointed to take, state and report the assignee’s account. The order of reference, among other provisions, contained the following:
    “ Ordered, that said referee take proof of the composition between said assignors and their creditors, and ascertain and report the character and value of the assets of said assigned estate, and what proportion of the fund shall be paid to or reserved for such creditors entitled to share in the distribution of the same, who have not and do not assent to said composition.”
    When this order was made the plaintiffs’ testator had not proved his claim, but by an order made June 6, 1890, he was granted permission to prove it before the referee, which he did, and it was found to be $17,029.50.
    June 11, 1890, the referee made his report, which, however, was not introduced in evidence, and the only knowledge we have of its contents is derived from the recital contained in the final order entered on the accounting. The order recites: “ By which said report it appears that on or about the 8th day of March, 1890, the ■above-named assignors, and each of them, and certain of their creditors, made and entered into and executed and delivered a composition agreement in writing, under seal, by the terms whereof the creditors executing the same, for the consideration therein stated, did mutually covenant and agree to and with said assignors, and each of them, that upon the entry of final decree in this proceeding directing the assignee to release the assets and assigned estate to the assignors, they, the said creditors, will severally accept, receive and take of and from the said assignors for each and every dollar owing by them to said several creditors the sum of five cents in cash, to be paid within forty days after the entry of such decree ; and, further, that upon the making to said creditors of the above-mentioned payments, after such decree as aforesaid, the said assignors, and each and every of them, should thereby be released and forever discharged of and from all claims, debts, demands and liabilities of every nature, kind and description to said creditors; and it further appearing by said report that, the following creditors proved claims before said referee, and have executed and delivered said composition agreement, namely.” (Here follow the names of the creditors and the amount of their claims who executed the composition deed.)

      “Also, that the followvng-na/med creditors of said estate have assented to said composition, but ha/oe not executed the said agreement, namely: * * * G. I). Gilder sleeve, $17,6<39.50P

    This decree was granted July 14, 1890, and adjudges that the referee’s report be in all respects confirmed, and his findings are adopted by the court. It also adjudges that the assets in the hands of the assignee be restored to the assignors upon their paying, within forty days, five pier cent upon the amount of the claims established, and that the assignee and his sureties be discharged. It was alsp adjudged: “ Upon the payment to the following-named creditors, who ha/ve assented to the composition but have not executed the agreement, or upon payment into cotirt to their said order, of them cond each of them, of the sums of money set opposite to their respective names, to wit: * * "* G. D. Qildersleeve, $881.37f etc.

      John A. Taylor, for the plaintiffs.

      Archibald L. Sessions, for the defendants.
   Follett, J. :

The accounting was a special proceeding, pirosecuted under the General Assignment Act (Chap. 466, Laws of 1877), from which the court derived its piowers. The only provisions in the act relating to compiositions with creditors or assignors are found in sections 20 and 22:

§ 20. On a piroceeding for an accounting under this act, the County Court shall have power * * *
“ 6. On piroof of a composition between the assignor and his creditors, to discharge the assignee and his surety from all further liability to the compounding creditors appearing or duly cited, and to authorize the assignee to release the assets to the assignor, provided,, however, that if there be any creditors not assenting to the composition, the judge shall determine what proportion of the fund shall be paid to or reserved for creditors not assenting, which shall not be less than the sum or share to which they would be entitled if no composition had been made, and may decree distribution accordingly.”

Section 22 provides that decrees shall have the same force and effect as though made in actions, and then follow directions in respect to the entry of orders, a reference being made to orders, releasing assets to assignors.

¥e find no warrant in the General Assignment Act, or in any precedent in the reports, authorizing the court, on a final accounting, to adjudicate that a creditor by a composition ” or by assenting to the terms of such an instrument executed by other creditors, has discharged his debtor from all liability. The section quoted authorizes the court, by its decree, “ to discharge the assignee and 1ns surety from all further liability to the compounding creditors appearing or duly cited,” but it does not authorize the court to adjudge that the-assignor has been or that he be discharged from all liability to such creditors. An agreement by the creditors that the assigned estate be restored to the assignor^ and that the assignee be discharged without providing for the discharge of the assignor from his debts,, would be quite sufficient to authorize the court to make the adjudication provided for in the sixth subdivision of section 20. If a, creditor executes or assents to a composition executed by other creditors, by which his debtor is discharged from his debt, well and good, but the decree of the court that he has so executed or assented, is no evidence of the fact. In case an action is brought on the debt, and a discharge thereof is pleaded, it must be established by producing it, if in writing, as in this case.

Under subdivision 6, above quoted, the county judge or court has-power : (1) To discharge the assignee and his sureties from all further liability to the compounding creditors appearing or duly cited; (2) to authorize the assignee to release the assets to the assignor; provided, however, that if there be any creditors not assenting to the-composition, the court shall determine what proportion of the fund ■shall be paid to or reserved for creditors not assenting, which shall not be less than the sum or share to which they would be entitled if no composition had been made; (3) to decree distribution accordingly. Other powers are conferred, which may be exercised upon an accounting, but they do not velate to compositions, and are not germane to the question under discussion. ¥e think it is very plain that no power is conferred upon the court by this statute to determine on a final accounting that a compounding creditor has released the assignor from all liability on his debt, and that an adjudication to that effect being beyond the power of the court, and not within the issues raised by the proceedings, is void and of no effect. It is not necessary to cite authorities to show that an adjudication which is beyond the power of the court to make, or that a determination ■of a question not involved in an action or in a special proceeding in which it is made, does not estop the litigants or their privies.

The only evidence offered to show that the plaintiffs’ testator had agreed to release the defendants is found in the recitals in the final decree, which are italicized in the statement of facts, which were not competent, and the plaintiffs’ objection to their reception in evidence should have been sustained. The composition deed was not put in evidence, and we have no knowledge of its terms except such as we have derived from the recital quoted from the final decree. It was not asserted at the trial that plaintiffs’ testator had executed this or any other composition deed or release, and, as before stated, the only evidence that he assented to the deed is contained in the recitals, which were not relevant.

The defendants insist that an oral agreement between several creditors and their debtor to compound and discharge their claims is valid. This is true. (Fellows v. Stevens, 24 Wend. 294; Chemical Nat. Bank v. Kohner, 85 N. Y. 189.) But in this case no legal evidence of any composition or release was before the court.

Again, the plaintiffs offered to show, but were precluded from showing, that there was in fact no such agreement. This was error.

As bearing upon the question whether the debt had been discharged, the plaintiffs offered to show that long after the entry of the final decree the defendants authorized the sale of bonds held as collateral for the payment of the note, and directed that the avails be applied thereon, which was excluded. This was error. The release of a debt presumptively discharges all collateral securities held by the creditor for the debt released. (Cowper v. Green, 7 M. & W. 633; Leake Cont. 926, 62-5; 2 Chitty Cont. [11th Am. ed.] 1159.) The fact that the defendants recognized the right of the plaintiffs to the proceeds of the collateral was relevant to the question in issue between the litigants.

The plaintiffs’ exceptions are sustained, the verdict set aside and a new trial is granted, with costs to them to abide the event.

Parker, J., concurred; Yan JBrunt, P. J., concurred in the' result.

Plaintiffs’ exceptions sustained, the verdict set aside and a new trial granted, with costs to them to abide the event.


source: Caselaw Access Project

author: Eollett, J.:

license: Public Domain

text:
    Maggie Lahey, as Administratrix, etc., of William Lahey, Deceased, Respondent, v. William Ottmann & Company, Appellant.

      JEvidence — self-serving declarations — res gestee — power of an employee to bind his employer by admissions as to his own negligence■ — admission by silence — general objection to evidence.

    Whether self-serving declarations are admissible or not depends upon whether they were made under such circumstances that they are presumed to be instinctive; if they may have been the result of thought or deliberation they are not admissible.
    In case a principal is liable for the tort of his agent, statements of his agent made during the commission of the wrong are admissible as against the principal, but it is essential that the statements or admissions should be part of the transaction to which they relate.
    In case an agent or employee commits a tort for which his principal is sought to be held liable, and sometime afterwards makes an admission or statement against the interest of his principal, such admission or statement is not admissible in evidence against the principal unless authority from him is shown, to the employee, to make the admission or statement.
    An employee or agent cannot bind his principal by an admission by conduct, by remaining silent when statements which ought to be denied are made in his hearing, unless he has authority to bind his principal by a direct admission or statement.
    On the trial of an action brought to recover damages for the death of the plaintiffs intestate, alleged to have been caused by the negligence of the defendant’s employee while driving a cart on a city street, a policeman was permitted to testify, as a witness for the plaintiff, to certain self-serving declarations of the decedent as to his conduct, and that of the defendant’s driver, made in the presence of the driver, some blocks distant from the place of the accident and sometime after the accident occurred; the declarations were not voluntary, but were drawn from the decedent by questions of the witness.

      Held, that the declarations were not admissible as part of the res gestae, or upon the ground that the defendant was bound by the conduct of his driver when they were made or by the driver’s failure, if he did fail, to deny them. •
    'Tlie plaintiff sought to introduce statements made by the defendant’s driver some little time after the accident, at a police station, when a criminal complaint was made against him, and which evidently referred to his criminal liability and related to the complaint then made against him.

      Held, that under such circumstances the driver could not, at that time, be deemed to have been acting as the agent of the defendant or in the course of his employment.
    An objection “to any statement made by the deceased,” held, to be sufficiently explicit to raise the question that declarations made by the decedent, prima facie incompetent, were inadmissible in evidence.
    Appeal by tlie defendant, 'William Ottmann & Company, a business corporation, from a judgment of tlie Supreme Court, entered in tlie office of tlie clerk of the city and county of New York on tlie 17th day of Marcli, 1893, upon a verdict in favor of the plaintiff rendered at the New York Circuit, and from an order denying the defendant’s motion for a new trial made upon the minutes.

      Williaon S. Cogswell, for the appellant.

      William F. Fmdel,. for the respondent.
   Eollett, J.:

This action is for the recovery of damages occasioned by the death of the plaintiff’s intestate caused, it is alleged, by the negligence of the defendant’s employee.

On the 7th of September, 1892, plaintiff’s intestate was run over by defendant’s cart on Third avenue near Thirty-second street, sustaining injuries from the effect of which he died on the next day. It is alleged in the complaint and admitted in the answer that the defendant is a corporation; that it owned the horse and cart, and that it was driven by its employee while engaged in transacting-defendant’s business. At the time of the accident the horse was being driven on the west or down-town track of the Third avenue railroad, and at tli.e same time a car passed on the east or np-town track of said railroad. According to decedent’s declaration, made shortly after the accident, he was in the street for the purpose of taking this up-town car, and the defendant’s driver testified that such was his apparent purpose.

Cunningham, a witness called by the plaintiff, and the only witness besides the driver who saw the decedent just before the accident, testified that he left the northwest corner of Thirty-second street and Third avenue to cross the avenue, but he could not state his purpose. There is little or no evidence as to what the decedent or the driver did immediately preceding the collision except that given by the driver and the declarations of the intestate, the admissibility of which is about to be considered. Immediately after the accident decedent was taken to Brimelow’s drug store, which one witness testified was on the corner of Thirty-first street and Third avenue, and another, that it was on the corner of Thirtieth street and that avenue. It was either one or two blocks from the place of the accident. "When the decedent was being taken into the drug store, John Casey, a policeman, being attracted by the crowd, entered the store where the driver and the decedent then were. What then occurred will best be described by quoting the policeman’s evidence, who was called by the plaintiff. “ I arrested the driver, and had a talk with the deceased, in the presence of the driver. Q. State what conversation you had with the deceased. [Objected to.] Q. Was this immediately after the accident? A. Yes, sir.

“ By the Court. — Q. Tell how you heard of it. A. My attention was attracted to a crowd at Thirty-first street. A man came rushing up to me and said: £ There is an accident; a man is run over, and there were three or four men taking him into a store — a drug store.’ I asked where was the man that drove the wagon; they said : £ We have him here.’ I immediately placed him under arrest. I asked the deceased how he got run over. [Defendant’s counsel objects to any statement made by the deceased.] Q. Was the driver there with you? A. Yes. [Objected to; objection overruled ; exception taken.]

££ By plaintiff’s counsel. • — • Q. State what the deceased said to you. A. I asked how the accident occurred. He said he was about to take a Third avenue car; he left the sidewalk and this wagon came along; lie was about to board tlie ear, and tliis wagon came along, and lie lield liis hand up to pull them up, and before he had a chance to get out of the way he was thrown down.”

Afterwards, the time not appearing, the policeman took the decedent and the driver to the station house.

“ Q. Did he (intestate) at any time make any further remark ? A. Yes, in the station house. Q. Was the driver there? A. Yes, sir. Q. State wliat he said. A. When he was taken before the sergeant the sergeant asked'him: ‘Are you going to make a charge against this man? ’ lie said: ‘ Well, if he will pay all expenses I won’t.’ The sergeant said: ‘ Take him in tlie back room.’ While he was in there he had a conversation with the driver; he (intestate) said: ‘ You had no right to do what you done; a fool would not do it, and I will make a charge against you.’ ”

The rulings of the court by which the declarations of the intestate were admitted are challenged on this appeal, and it is sought to sustain them upon two grounds: (1) That the declarations were a part of the res gestae; (2) because they were made in the presence of the defendant’s driver. Whether self-serving declarations are admissible or not depends upon whether they were made under such circumstances that they are presumed to be instinctive, but if they may have been the result of thought or deliberation they are not admissible. The declarations at the drug store are clearly not a part of the res gestae. The accident occurred at the corner of Thirty-second street, and the drug store was either one or two blocks away, and some time had intervened between the accident and the interview; liow much is not disclosed by the record. The declarations were not voluntary, but were drawn from the declarant by the question of the policeman. These declarations were not admissible as a part of the res gestae under the rule laid down by the Court of Appteals. (Whitaker v. Eighth Avenue R. R. Co., 51 N. Y. 295 ; Waldele v. N. Y. C. & H. R. R. R. Co., 95 id. 274; Martin v. N. Y. C. & H. R. R. R. Co., 103 id. 626.) The declarations made at the station house are still more remote and objectionable. Were the declarations admissible because made in the presence of the defendant’s driver ? In case a principal is liable for the tort of his agent, statements of his agent made during the commission of the wrong are admissible as against the principal, but it is essential that the statements or admissions should be part of the transaction to Avhich they relate. In case an agent or employee commits a tort for which his principal is sought to be held liable, and sometime afterwards makes an admission or statement against the interest of his principal, it is not admissible in evidence against him unless authority is shown on the part of the employee to make the admission or statement. In this case the driver made no distinct admission or statement, and the only ground upon which it can be urged that these declarations made by deceased amount to an admission by the driver is that they were made in the presence and presumptively in the hearing of the driver. "When a statement is made in the presence of a person interested, by an adversary and under such circumstances that it ought to be denied, and the interested person remains 'silent, it becomes an admission by conduct, but before a statement so made becomes admissible by reason of the conduct of the person to whom made, it must be shown that he remained silent or that by his conduct he tacitly admitted the truth of the statement. An employee or agent cannot bind his principal by conduct unless he has authority to bind him by a direct admission or statement. The reception of these declarations of the driver cannot be sustained on the ground that they were a part of the res gestee, or upon the ground that the defendant was bound by the conduct of the driver or by his failure, it he did fail, to deny the statements. The driver’s statement at the police station was some little time after the accident, and was evidently made with reference to the criminal liability of the driver, and related to the complaint then made against him. Under such circumstances, the driver cannot be deemed to have been acting as the agent of the defendant and in the course of his employment.

It is urged that the objection to any statement made by the deceased,” and the exception subsequently taken to the ruling of the court, are not applicable to the evidence subsequently given. At first, the court did not rule on the objection, but as soon as a ruling was made an exception was taken, and we think that the objection and exception clearly related to the admissibility of the decedent’s statements and to nothing else. It is also urged that the objection is not sufficiently explicit to raise the question that the evidence was inadmissible. The fact sought to be proved, the conduct of the decedent and the driver, was relevant and competent, but the mode by which it was sought to be proved — by the decedent’s statement — was not fjrima facie competent, and to this point the objection went, and it must have been understood by the court and by the plaintiff’s counsel. A general objection to the admissibility of a fact in evidence is sufficient in case the fact offered is wholly incompetent, and its incompetency could not have been obviated by other evidence; and when the mode by which the fact is offered to be established is gri/ma facie incompetent under the general rules of evidence, and attention'is called by an objection to the reason why the mode is illegal, it is sufficient. The burden was on the plaintiff of proving á proper foundation for the introduction of these declarations which were pri/ma facie incompetent, but this she failed to do.

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

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

Judgment and order reversed and a new trial granted, with costs to the appellant to abide the event.


author:
Follett, J.:
      O’Brien, P. J.

text:
    The People of the State of New York, Respondent, v. Charles W. Gardner, Appellant.

      Attempt to commit the crime of exUn'tion through fern' —failure to prove the existence of fearr — evidence to repel an imputation of guilty motive.

    A conviction for an attempt to commit the crime of extortion, through fear, cannot be sustained where the evidence conclusively shows the absence, on the part of the person against whom the crime was attempted, of a state of mind necessary to make possible the perpetration of the crime attempted, as, e g., where the evidence shows that such person parted with his money for the purpose of convicting the wrongdoer of a crime, and, consequently, without being put in fear, (O’Brien, P. J., dissenting.)
    On the trial of an indictment charging the defendant with having attempted to obtain a certain sum of money from a woman named, by threatening to accuse her of keeping a disorderly house, and by means of such threats putting her in fear, the evidence was to the effect that the defendant, who was an agent of a society for the prevention of crime, threatened to have the woman, who was the keeper of a disorderly house, prosecuted for keeping such house, and agreed that if she would pay him a certain sum he would not accuse her of that crime; that the woman, acting as a decoy for the police and trying to induce the defendant to receive money from her under such circumstances as would render him guilty of the crime of extortion, gave to the defendant the said sum of money, which she had received from the police for that purpose. The defendant was convicted as charged.

      Held, that although the evidence established all the other essential elements of the crime of extortion, still, as it failed to show that the woman was induced by fear to give the money to the defendant, the conviction for an attempt to commit extortion could not stand; and that, it being apparent that a conviction could not be sustained under the indictment, the defendant should be discharged. (O’Brien, P J , dissenting.)
    In a criminal case, when it is proved that the defendant has committed some act, and the motive with which it was done is material, he may testify in regard to his motive and may prove facts by others tending to show his intent; and when evidence tending to show a guilty motive on the part of the accused has been given, he has a right to give evidence to prove a different motive and repel the imputation.
    Evidence having been given for the prosecution from which the jury might infer that the motive which induced the defendant to associate with the woman was unlawful and for the purpose of securing money from her, the defendant undertook to testify on his own behalf that he had received from certain directors of the society of which he was an agent, instructions to pursue an inquiry as to an alleged blackmailing of the woman by a former discharged agent of the society, and to obtain from her, if possible, statements in reference thereto. This evidence was excluded.

      Held, error ; that it was competent for the defendant to prove in explanation of his conduct that he associated with the woman by the direction of the Society for the Prevention of Crime for the purpose of securing a statement from her.
    Appeal by tbe defendant, Charles W. Gardner, from a judgment of the Court of General Sessions of the Peace of the city and county of New York, rendered on the 14th day of February, 1893, convicting him of the crime of attempting to commit the crime of extortion, and from an order denying the defendant’s motions for a new trial, and in arrest of judgment.

      John W. Goff, for the appellant.

      Henry B. B. Stapler, for the respondent.
   Follett, J.:

It is alleged in the indictment that at the city of New York, on the 4th day of December, 1892, the defendant attempted to obtain $150 from Catherine Amos, by threatening to accuse her of keeping a disorderly house, and by means of such threat put her in fear.

The following are the sections of the Penal Code under which the defendant was convicted:

“ § 552. Extortion is the obtaining of property from another, with his consent, induced by a wrongful use of force or fear, or under color of official right.”
§ 553. Pear such as will constitute extortion may be induced by a threat:
«* x x
2. To accuse him * * * of any crime.”
§ 34. An act, done with intent to commit a crime, and tending but failing to effect its commission, is an attempt to commit that crime.”
“ § 685. A person may be convicted of an attempt to commit a crime, although it ajjpears on the trial that the crime was consummated, unless the court, in its discretion, discharges the jury and directs the defendant to be tried for the crime itself.”

The crime of extortion is not committed unless the person parting with his money is induced to do so by the wrongful use of force or fear, or under color of official right. No force was used by the defendant, nor did he obtain the money under color of official right, and there is no charge in the indictment of the use of force or of the assertion of official right.

In the criminal law putting in fear is constructive violence. (2 Russ. Or. [5th ed.] 89-93.) When fear is a necessary ingredient of a crime it must actually exist at the time of the alleged commission of the offense, and if the person alleged to have been injured part with'his money or property without at the time being in fear a crime is not committed. (Rex v. Jackson, 1 East P. C. addenda XXI; 2 Russ. Cr. [5th ed.] 104; Reanes Case, 2 Leach, 616; S. C., 2 East P. C. 734; 1 Bish. Cr. L. [8th ed.] § 436.)

If, as in the case at bar, the complainant part with his money for the purpose of convicting the wrongdoer of a crime, no offense is committed because there is no putting in fear. (Rex v. Fuller, R. & R. 408; 1 Whart. Cr. L. [8th ed.] §§ 141, 857.) In the case last cited the person applied to Fry to lend him ten shillings, and upon his l’efusal threatened to charge him with an unnatural crime, and got from him one pound and ten shillings. Fry parted with the money from an anxiety that his master’s family might not be disturbed, and in expectation that he might secure the prisoner. He immediately stated the circumstances to his master and to a friend, and planned with them what he should do in case the prisoner applied again. He did apply again, and Fry appointed a place where they would meet, marked some money, engaged a constable, and, having met the prisoner, gave it to him and had him arrested. He parted with his money in order that he might prosecute. This was held not to be putting in fear. (2 Russ. Cr. [5th ed.] 110; 1 Bish. Or. L. [8th ed.] §437.)

The evidence in behalf of the People, which we must assume was believed by the jury, established every ingredient of the crime of extortion, except that Catherine Amos was induced by fear to give $150 to the defendant. In saying this we assume, without deciding that the fact is immaterial, that the money did not belong to the woman, but to CaptainWilliam S. Devery, who delivered it to her for the sole purpose of having it given to the defendant. It being known (theoretically by the grand jury, but in fact by the draughtsman of the indictment) that a conviction of the crime of extortion could not be had without proving that the woman was induced by fear to part with the money, and it being known that this fact could not be proved, the defendant was indicted for an attempt to commit that crime.

Catherine Amos, who was the principal witness for the People, testified that for nine years she had been the keeper of houses of prostitution in the city of New York, and that the defendant, who was the agent of a society for the prevention of crime, on several occasions since October 13, 1892, threatened to have her prosecuted for keeping such houses, and agreed that if she would pay him certain sums of money, and especially $150, that he would not accuse her of that crime. She testified, and so did Captain William S. Devery, that from October 19, 1892, to December 4, 1892 (the last date being the day on which the money was received), she had been acting as a decoy of the police, and trying to induce the defendant to receive money from her under such circumstances as would render him guilty of a crime, and enable the police to arrest and convict him of it. There is no pretense that the woman was induced by the threats of the defendant to give the money to him.

Whether certain acts are or are not criminal depends entirely on whether the person on or against whom they are perpetrated consents to and participates in those acts. Such acts do not constitute a crime in case the assent of the person against whom they are committed is freely given. When a particular state of mind is a necessary ingredient of an offense, that offense cannot be committed unless the state of mind prescribed by the statute is shown to exist.

The rule is well stated by Wharton in section 149 of the eighth edition of his Criminal Law: “ It is also to be noticed that in cases in which, as in rape and larceny, the act, to be indictable, must be against the prosecutor’s will, when the prosecutor by such inveigling, consents to the act, these particular forms of prosecutions cannot be maintained.”

That no injury is done to the willing is a maxim of the criminal, as well as of the civil law, if the one who consents is capable of consenting and consents uninfluenced by fear, forcé or fraud. This rule is applicable, however, only to the alienable rights of the person consenting. The consent of a person that another might take his life would be no justification of a homicide.

When acts are committed, the criminality of which depends on whether the person on or against whom they are committed, assents to or dissents from their commission, and between the attempt and. the execution there is. interposed the consent of the person against whom perpetrated that they may be committed, an indictable offense is not made out. (Whart. Cr. L. [8th ed.] § 177.)

It is plain that a conviction cannot be sustained under section 685' of the Penal Code, and that the district attorney acted wisely in not presenting an indictment for the crime of extortion.

The crucial question in this case is whether a conviction for an attempt to commit the crime of extortion can be sustained where the evidence conclusively shows the absence, on the part of the person against whom the crime is attempted, of a state of mind necessary to make possible the perpetration of the crime attempted.

We take it to be a general rule, having few, if any, exceptions,, that unless the completed act, accomplished as intended and attempted, will constitute a crime, no step or steps taken to perpetrate the act will amount to a criminal attempt. (Bish. Cr. L. [8th ed.] §§ 747, 728.) We are referred to People v. Moran (123 N. Y. 254) as an authority to sustain this conviction. In that ease the defendant committed a trespass on a person with intent to steal, and had he accomplished the act which he attempted and intended, the crime of larceny would have been committed. That case is within the rule above stated.

A boy so young that he is deemed incapable of perpetrating a rape cannot be convicted of an attempt to commit that offense, nor of an assault with attempt to ravish, but he may be convicted of an assault and battery. (People v. Randolph, 2 Park. 213; 1 Bish. Cr. L. [8th ed.] § 746, and cases cited.)

At common law, if a person intending to steal an article take it with the owner’s consent it is not larceny. (Thorne v. Turck, 94 N. Y. 90-95 ; 2 Bish. Cr. L. [8th ed.] § 811; 1 Whart. Cr. L. [8th ed.] § 915.) In such a case the completed act, accomplished as intended, not being a crime, none of the steps taken being ingredients of the offense, would constitute a crime, and the taker could not be convicted of an attempt to commit the crime of larceny.

If an assault should be made on a man dressed as a woman with intent to ravish, the assailant believing the person assaulted to be a woman, he could not be convicted of an intent to ravish, because in such a case the commission of the crime of rape would be a legal impossibility. So, in the case at bar it was a legal impossibility to commit the crime of extortion as against the woman Amos, because she inveigled the defendant to commit the act and was not put in fear by him.

The learned recorder correctly laid down the rule in his instruction to the jury in the following propositions:

III. If you find that he did make such a threat you must then find, before you can convict, that the woman Clifton was, by such threat, placed in fear, and that it was only through fear she was induced to agree to part with her money.”
Ilia. If you find that this woman did agree to pay the defendant money, and in so doing acted of her own free will and without fear, then there was no attempt to extort the money, and if you have any reasonable doubt on this point you must give the benefit to the defendant and acquit him.”

As we have before stated, there is no evidence which tends to show that the woman acted through fear, the uncontradicted evidence being that she induced the defendant to receive tlie money from her. The jury failed to follow the plain instruction given by the court, and the verdict should be set aside.

The People proved that on several occasions between October 13 and December 4,1892, the defendant and Catherine Amos were in each other’s company upon apparent terms of intimacy, driving, eating and drinking, each in turn entertaining the other. The defendant, when on the stand, testified that he had so associated with this woman. The effect of this evidence was two-fold: to discredit the defendant and to show that he had an opportunity, by threats or by promises of protection, to induce the woman to give him money. It appears by the evidence that George C. Grant, a discharged employee of the society, had visited Catherine Amos and other such persons and offered, for sums of money, to prevent prosecution by the society of which the defendant was the agent, which was known to the directors of the society. The defendant testified that he associated with Catherine Amos for the purpose of obtaining from her a written statement or an affidavit of the particulars of Grant’s proposition to her. In this connection the defendant was asked: “ Q. After you reported the matter to Dr. Parkhurst and Mr. Morse of the executive committee of the society, under whom you were acting, did you receive from them directions to pursue the matter, and to obtain if possible any statements of alleged blackmail from the woman Clifton (Amos) ? ”

This was objected to and the evidence called for by the question was excluded and an exception taken.

Frank Moss and Thaddeus D. Kenneson, two directors of the society, were sworn in behalf of the defendant, by whom he offered to prove that the officers of the society gave him instructions to obtain a statement from Catherine Amos in respect to Grant’s proposition to her. This was excluded and an exception taken. In these rulings the court erred.

In a criminal case, when it is proved that the defendant has committed some act, and the motive with which it was done is material, he may testify in regard to his motive and may prove facts by others tending to show his intent. (Kerrains v. People, 60 N. Y. 221.) And when evidence tending to show a guilty motive on the part of the accused has been given, he has a right to give evidence to p^ove a different motive and repel the imputation. From the evidence offered the jury were asked to infer, and probably did infer, that the motive which induced the defendant to associate with Catherine Amos was unlawful and for the purpose of securing money from her. It was competent for him to prove in explanation of his conduct that he associated with the woman by the direction of the Society for the Prevention of Crime for the purpose of securing a statement from the woman. It is urged on the part of the People that if it were error to exclude this evidence it was ■cured by subsequently allowing Dr. Charles H. Parkliurst to testify on tiie same subject. This witness was ill at the time of the trial, and his deposition was read. He testified: “ Q. Did the executive committee of the society at this meeting next subsequent to October II, 1892, give any instruction to Gardner? A. Yes, sir. Q. So far as they relate to Grant and his actions, please state them. A. The instructions we gave him, as far as I can recollect, were that, in consonance with his own view of the matter, as he had previously expressed it to me privately, and in consonance with our views, which were the same as his, he should seek to make a case against these women, and that he should also strive to secure from them at least an affidavit to the effect that Grant was, in the name of the society, attempting to levy blackmail upon them. We also instructed him that he should use such means as he saw fit in order to secure such affidavits. These instructions were oral.”

This did not cure the error. The defendant had the right to prove the fact by more than one witness, and it is well known that facts testified to in a deposition and read in evidence have not the same force with a jury as those testified to by witnesses in the presénce of the court. Again, this evidence related only to the instructions given by the executive committee to Gardner. The defendant had offered to show that he had not only received instructions but that he acted pursuant to and by reason of those instructions.

For these errors the judgment should be reversed, and, as it is apparent that a conviction cannot be sustained under this indictment, the defendant should be discharged.

Parker, J\, concurred.

O’Brien, P. J.

(dissenting):

With the conclusion of my associates, as expressed in the opinion of Mr. Justice Follett, that because there ivas no evidence which tended to show that the woman acted through fear, the verdict must be set aside and the prisoner discharged, I cannot concur.

The prisoner was indicted and tried for an attempt to commit the crime of extortion, and the record shows that the evidence tended to establish the existence of every other element constituting the crime of extortion, except that the woman, in paying the money, was actuated in so doing by fear. This latter element, essential to constitute the crime itself, if wanting, it is urged, renders it impossible to sustain an indictment and conviction for the lesser crime of an attempt at extortion.

An attempt is defined by the Penal Code (§ 34), as “an act done with intent to commit a crime, and tending, but failing to effect its commission.” Or, as amplified by Bislwp in his treatise on Criminal Law (8th ed., vol. 1, § 728): “ An attempt is an intent to do a particular thing which, the law, either common or statutory, has declared to be a crime, coupled with an act toward the doing, sufficient both in magnitude and proximity to the fact intended, to he taken cognizance of by the law. * * * Or, more briefly, an attempt is an intent to do a particular criminal thing, with an act toward it falling short of the thing intended.”

In the case at bar, if the testimony of the witnesses for the People was credible ■ — • and that was a question for the jury — the prisoner attempted to obtain money from the complainant by oral threats to accuse her of the crime of keeping a house of ill-fame. It is true that the fear intended to be produced by his threats did not follow, which was due to the fact, extrinsic, and unknown to the prisoner, that the complainant, in appearing to be affected by such threats into delivering up the money, was acting under the instructions of the police, with a view to entrap the prisoner. Had the prisoner succeeded in producing the fear he intended, the substantive crime would have been made out; but, in the absence of such fear on the part of the complainant, I think that the evidence of the intent to extort, and the acts done tending to effect the commission of the crime, but which failed to effect its commission by reason of the attitude of the complainant, was sufficient to justify a conviction for an attempt.

Upon this question of fear, it seems to me that throughout the fact is lost sight of that it is the mind of the wrongdoer and his intent, and not the effect or result upon the person sought to be coerced, in a crime of this character, which must control. As said in People v. Moran (123 N. Y. 254): “ The question whether an attempt to commit a crime has been made, is determinable solely by the condition of the actor’s mind, and his conduct in the attempted consummation of his design.” I concede that there are certain crimes where the element of force or fear must be present in order to constitute the offense. Such an instance would be of rape, where if the consent of the woman was given, or if force was not used, the elements necessary to constitute the crime would be lacking, and a conviction for an attempt to commit such a crime upon such facts could not be predicated. In the instance given of rape the intent is to subject the physical body to the unlawful designs of the wrongdoer ; whereas, in the case at bar, it was intended to produce a mental condition, namely, fear, which must be present to constitute the substantive crime. And it seems to me that where every act essential to constitute the crime is present, except the mental effect intended to be produced, namely, fear (and thus under the definition it falls just short of the crime itself), that the offense thus described is criminal, and comes within the definition of an attempt to commit the crime.

Here the evidence tended to prove that the prisoner had the criminal intent, and had made the effort to consummate that intent, which, for causes unknown to him, was not successful, and which prevented him from committing the crime. The crime was as complete as the prisoner could make it; and to conclude that the failure to establish every element essential to constitute the crime, except of fear, must result in the discharge of the prisoner, is equivalent to my mind to asserting that there can be no such crime as an attempt to commit extortion. For, if the reasoning applied to the absence of fear is good, then, unless all the elements essential to Constitute the crime are present, an indictment and conviction must fall because a conviction for an attempt cannot be sustained except in a case where the crime itself is committed.

I cannot but regard the reasoning of the Court of Appeals in the case of People v. Moran (supra), as controlling in principle. There the defendant was indicted and convicted of an attempt to commit the crime of grand larceny in the second degree. This crime is defined by section 531 of the Penal Code as the stealing or unlawful appropriation of property of any value by taking the same from the person of another. The evidence in that case showed that the prisoner was seen to have thrust his hand into the pocket of a woman, and to have withdrawn it therefrom empty; and the claim was there made that the evidence did not show that the woman had any property in her pocket which could be the subject of larceny, and that an attempt to commit that crime could not be predicated of a condition which rendered its commission impossible.

This claim is thus disposed of in the opinion: “ To constitute the crime charged there must be a person from whom the property may be taken, an intent to take it against the will of the owner, and some act performed tending to accomplish it; and when these things concur, the crime has, we think, been committed, whether property could in fact have been stolen or not. In such cases the accused has done his utmost to effect the commission of the crime, but fails to accomplish it for some cause not previously apparent to him. The question whether an attempt to commit a crime has been made is determinable solely by the condition of the actor’s mind, and his conduct in the attempted consummation of his design. (Citing People v. Lawton, 56 Barb. 126 ; McDermott v. People, 5 Park. Cr. Rep. 104; Machesey v. People, 6 id. 114 ; Am. & Eng. Ency. of Law, title “ Attempt.”) So far as the thief is concerned, the felonious design and action are then just as complete as though the crime could have been or in fact had been committed, and the punishment of such offender is just as essential to the protection of the public as of one whose designs have been successful.”

The answer to the claim here made, that because the crime of extortion was not possible, in the absence of fear on the part of the complainant, therefore, an indictment and conviction upon evidence as and for an attempt to commit such crime is likewise impossible, I think is to be found in the language just quoted from the opinion in People v. Moran, which is throughout strengthened by the citation of numerous authorities. Thus, among others, reference is had to the case of Commonwealth v. Jacobs (9 Allen, 274), wherein Justice Grav says: Whenever the law makes one step towards tbe accomplishment of an unlawful object, with the intent or purpose of accomplishing it, criminal, a person taking that step, with that intent or purpose, and himself capable of doing every act on his part to accomplish that object, cannot protect himself from responsibility by showing that by reason of some fact unknown to him at the time of his criminal attempt it could not be fully carried into effect in the particular instance. Upon this principle, on an.indictment under a statute against passing or disposing of forged bank notes with intent to defraud, it has been held no defense that those to whom the notes were passed knew them to be forged, and, therefore, could not be defrauded.”

And, again, in the case of The State v. Wilson (30 Conn. 500), referred to in the opinion, the court there said: The perpetration of the crime was legally possible, the person in a situation to do it, the intent clear, and the act adapted to the successful perpetration of it, and whether there was or not property in the pocket was an extrinsic fact not essential to constitute the attempt.”

And after quoting with approval many of the cases, the opinion in People v. Moran says : There are numerous other cases in this country analogous to those above cited, in which it has been held that an attempt to commit a crime might be predicated of a condition which rendered it impossible for the crime to have been in fact committed.”

It is unnecessary, however, that I should pursue this subject further, as I have sufficiently explained the views I entertain, that while to constitute the substantive crime it would be necessary, in an indictment to aver, and upon the trial to prove, every essential ingredient enumerated in the definition of the crime, this is not requisite in an indictment or upon a trial where the charge is an attempt to commit that crime. While, therefore, in the case at bar, to establish the crime of extortion it would have been necessary to aver and prove that through fear the woman had delivered the money to the prisoner, yet the failure by his threats to produce such fear would not prevent an indictment and conviction for an attempt at extortion, provided every other element requisite and essential to constitute the crime were present.

In addition to this ground, my associates have concluded that it was error to have excluded certain evidence offered by the prisoner tending to show that in what he did he acted under the instructions of the Society for the Prevention of Crime and certain of its officers. In the view that the rulings of the trial judge in excluding such evidence was error I concur; these, however, upon a new trial could be cured, but in their conclusion upon the main ground that it is apparent that a conviction cannot be sustained under this indictment, and that the defendant should be discharged,”

I dissent.

Judgment reversed and the defendant discharged.


author: Parker, J.:

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    Mercantile National Bank of the City of New York, Respondent, v. Corn Exchange Bank, Appellant.

      JHsaretionm'y power to require a, reply to an answer — when exercised — when a, failure to exercise it is an error.

    The discretion committed to the court, allowing it to require a reply to new matter alleged in an answer, is a legal one, which should he so exercised as to prevent surprise, and promote the interests of justice.
    It will not he exercised if the only object is to relieve a defendant from the necessity of proving the facts which he sets up as a defense by way of avoidance, but where a judgment of the court is pleaded in avoidance, which seems to have such force and effect as to lead to a judgment in the defendant’s favor, an order of the Special Term denying the defendant’s motion to require a reply to the answer should be reversed, and the service of a reply be directed.
    The fact that the judgment so pleaded has been appealed from cannot have any weight in the disposition of the motion to require a reply, nor will it be assumed that the proceedings leading to the judgment contain error; if it should turn out to be so, the plaintiff can be relieved from the effect of its reply upon motion.
    Appeal by the defendant, the Corn Exchange Bank, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the city and county of New York on the 2d day of June, 1893, denying the defendant’s motion to compel the plaintiff to reply to the new matter set up in the defendant’s answer by way of avoidance.

      John M. Bowers, for the appellant.

      8. B. Brownell, for the respondent.
   Parker, J.:

The complaint alleges eleven separate causes of action, but all are in the same form and differ only as to the dates and amounts of the eleven checks which lie at the foundation of the several causes of action. The defenses interposed to each of the alleged causes of action are also in the same form, so that a determination of the question presented, whether a reply should be required to any or all of the defenses set up, to a single cause of action, will apply to all the others.

The complaint, after alleging the due incorporation of plaintiff and defendant as banking associations, avers:

Second. That on or about the 28th day of January, 1886, the plaintiff paid to the defendant, upon the defendant’s request and indorsement thereof, a check upon this plaintiff, drawn by the National Bank of Sumter to the order of A. S. Brown, for one hundred dollars ($100), which said check was not indorsed by the said A. S. Brown, the payee thereof.
Third. That this plaintiff, supposing the said check to be indorsed by the said A. S. Brown, paid the said amount thereof, to wit, one hundred dollars, to the defendant.”

The answer does not deny any of the allegations of the complaint, thereby admitting their truth, but sets up new matter in avoidance. The first briefly is that while the National Bank of Sumter drew the check to the order of A. S. Brown, it never intended that the check should be delivered or paid to him, or his indorsement thereon be required, but that it should be payable to the order of Cumming & Russell, to whom the bank delivered the check after indorsing the same as follows: “ Pay to the order of Cumming & Russell, A. S. Brown,” and that after this indorsement the plaintiff paid the check, through the agency of the defendant.

The second defense by way of new matter in avoidance is, that the National Bank of Sumter, the drawer of the said check, had an account with the plaintiff in this action, and moneys on deposit with it, and that when the plaintiff paid the said check it debited the National Bank of Sumter with the amount thereof, and that the accounts between the National Bank of Sumter and the plaintiff herein, containing such debit item against the National Bank of Sumter, were fully settled between the two banks ; that said account has never been opened, and that the Mercantile National Bank has never repaid the National Bank of Sumter the amount of said check, which check bore the indorsement of this defendant.

The third defense set up in avoidance is, that the duly appointed receiver of the National Bank of Sumter brought an action against this plaintiff in this court to recover the amount of the deposit which the National Bank of Sumter had with this plaintiff, which action it 'defended on the ground that it had paid out the amount of the deposit on the checks of such bank, and being the checks mentioned in the complaint in this action, resulting in a judgment in favor of the Mercantile National Bank, by which it was adjudicated that such payments were valid and binding upon the National Bank of Sumter and its receiver.

As this constitutes new matter, to which a reply is not expressly required by the Code, if one is not compelled by the court, it will be deemed controverted by traverse or avoidance, as the case requires. (Code, § 522.) But a reply may be required by the court in its discretion. (§ 516.)

The discretion thus committed is a legal one which should be so exercised as to prevent surprise and promote the interests of justice. It will not be granted when its only object is to relieve a defendant from the necessity of proving the facts which he sets up as a defense by way of avoidance. But where, as in the third defense, a judgment of this court is pleaded in avoidance, which, so far as the pleadings disclose, seems to have such force and effect as to. lead to a judgment in defendant’s favor, it is but just that it should be known how the plaintiff proposes to meet the issue of fact thus tendered ; if admitted, how, if at all, it expects to avoid the effect which defendant claims for it, to the end that surprise, with possibly an unjust result upon the trial, may be avoided. (Steinway v. Steinway, 68 Hun, 430.)

It is suggested in one of the biiefs that the judgment pleaded has been appealed from. That fact cannot have weight in the disposition of this question. The judgment stands in full force and effect, and it will not be assumed that the proceedings leading to it contain error. If it shall turn out otherwise, plaintiff can be relieved from the effect of its reply on motion.

We agree with the Special Term that a reply should not be required to the other defenses.

The older should be reversed, with ten dollars costs and disbursements, and the motion granted directing the plaintiff to reply to the third defense.

Yan Brunt, P. J., concurred.

Order reversed, with ten dollars costs and disbursements, and the motion granted directing the plaintiff to reply to the third defense.


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    The Arrow Steamship Company, Respondent, v. James Gordon Bennett, Appellant.

      Libel — rule determining the sufficiency of a pleading demurred to — application of the words to the plaintiff — proofof special damage — how far the words may be extended by innuendo — words that wcurramt an innuendo which is clearly libelo us.

    The general rule in determining the sufficiency of a pleading demurred to is, that it must be assumed that the facts stated therein, as well as such as may by reasonable and fair intendment be implied from the allegations made, are true.
    In an action brought to recover the damages resulting from a libel it is sufficient for the complaint to state generally that the words were published concerning the plaintiff, and, if such allegation be controverted, the plaintiff may establish it on the trial
    Pecuniary injury must necessarily result to a corporation engaged in manufacturing, trading or banking, or other occupation in which credit is material to its success, by language concerning it calculated to injuriously affect its credit, and, in such a case, an action may be maintained by the corporation without proof of any special damage
    The meaning of words in an alleged libel cannot be extended by innuendo beyond their fair import, aided by extrinsic facts with which they are connected, but the court will inquire whether the innuendo is warranted by tbe language used, considered in connection with the other facts to which they have relation, and, if found not to be warranted, a demurrer to the complaint will be sustained unless the words, without the innuendo, are actionable.
    An innuendo which alleges that the meaning of a portion of an article was that by reason of the publication the plaintiff was forced to discontinue business, is clearly libelous, and if the innuendo is fairly warranted by the publication complained of a cause of action is alleged.

      Where the complaint in the action alleged that the defendant published an article in an editorial column of his paper, wherein it was stated that when the plaintiff went fishing for stray twenty-dollar bills, that the defendant looked through the little scheme and told what he saw, that the plaintiff was not pleased, and accused him of misstating facts, but the plaintiff packed up its grip sack all the same, and started for a healthier clime.

      Held, that the assertion fairly warranted the innuendo; that the effect of the publication was to compel the’ plaintiff to discontinue business in the place selected by it for that purpose.
    Appeal by tlie defendant, James Gordon Bennett, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, made at the New York Special Term and entered in the office of the clerk of the city and county of New York on the 10th day of May, 1893, overruling a demurrer interposed to the complaint, with notice of an intention to bring up for review on such appeal the decision rendered on the 5th day of May, 1893, directing the entry of the interlocutory judgment.

      John Townshend, for the appellant.

      Devoid Mo G hure, for the respondent.
   Parker, J.:

The complaint alleges ten causes of action. Of these the ninth is not only first attacked, but is made the subject of far more extended consideration than the others on this appeal. This indicates that the learned counsel was of the opinion, as are we, that the other causes of action alleged are still stronger than this.

As we have reached the conclusion that the Special Term rightly overruled the demurrer as to the ninth cause of action, we shall discuss that one only. It reads as follows:

“(I.) The plaintiff is, and was, at the times hereinafter mentioned, a domestic corporation, having its principal office at the city of New York, organized for the purpose of constructing, using and leasing vessels and machinery, under patents, inventions and devices owned by said company, and such as might be acquired by it.
“ (II.) The defendant, at the times hereinafter mentioned, was the-proprietor and publisher of the ‘New York Herald,’ a daily newspaper, published at the city of New York, State of New York, which newspaper, as this plaintiff is informed and believes, is one of large circulation, so that, at the time the said articles hereinafter mentioned were published therein, the daily circulation of said paper was in the neighborhood of two hundred thousand copies or more.
“ (III.) The prosperity, usefulness, permanency and progress of the plaintiff company were, from the time of its incorporation, dependent not only on the honesty, good faith and skill of its management, and of the agents in various capacities employed by it, but also in the confidence of the public therein, and in the officers and agents who conducted the same.
“ (IV.) The plaintiff further avers, on information and belief, that the defendant undertook, as hereinafter more particularly set forth, by a series of malicious and wanton attacks on the officers of the plaintiff company, and upon the trustees of said company, and upon the general management, business, objects and purposes of said company, to break down and ruin the credit and reputation of said officers and of said trustees, and the purposes and objects of said company.”

On the 27th day of December, 1887, the defendant maliciously published in the said New York Herald, and caused the same to be circulated throughout the United States and elsewhere, certain false and defamatory matter concerning the officers of this plaintiff, and the management and affairs of this plaintiff, and of the plaintiff itself, said false and defamatory matter being contained in an article in the editorial column of said paper entitled : Real Progress in the South verms Booms,” wherein it was stated as follows: “ When the Arrow Steamship Company went fishing for stray twenty-dollar bills, we looked through the little scheme, and told what we saw. The Arrow Steamship Company was not pleased. They even accused us of misstating facts; but they packed up their gripsack all the same, and started for a healthier clime ” (meaning that after the publication of the articles above set forth, the plaintiff company conceded to the public that it was engaged in a swindling scheme, and by reason of the publication of said articles, was forced to discontinue its business); and wherein it was further stated as follows: The Herald tells the exact truth about these things ” (meaning the articles published as aforesaid, referring to plaintiff). This is followed by allegations of damages, both general and special, and a demand for judgment.

The general rule in determining the sufficiency of a pleading demurred to, is that it must be assumed that the facts stated therein, as well as such as may by reasonable and fair intendment be implied from the allegations made, are true. (Milliken v. Western U. T. Co., 110 N. Y. 403.)

Formerly it was necessary that the complaint should contain a preliminary averment pointing out the application to the plaintiff of the matter published. But this requirement was done away with by the Code, and it is now sufficient to state generally that'the words were published concerning the plaintiff. (§ 535.) If such allegation be controverted, plaintiff may establish it on the trial. Appellant insists that the plaintiff has not complied with the requirement of the Code in such respect. But his position is not well taken.

The paragraph of the complaint introducing the publication of the alleged libelous matter alleges distinctly that defendant published and caused to be circulated “ certain false and defamatory matter concerning the officers of this plaintiff, * * * and of the plaintiff itself, * * * wherein it was stated as follows : ”

Comment is unnecessary, for it is obvious that this allegation is in compliance with the Code.

Regarding the right of a corporation to recover damages because of the use of language spoken or written, which injuriously affects its reputation and credit, Mr. Townshend, in his work on Slander and Libel, says:

A corporation, like an individual, may have a reputation, and a good reputation is equally as valuable to a corporation as to a natural person; and as an individual may sustain injury by language affecting his reputation, so in like manner a corporation.” (§ 262.)
As regards a corporation engaged in manufacturing, ti-ading or banking, or other occupation in which credit may be material to its success, there, language concerning such a corporation, calculated to injuriously affect its credit, must necessarily occasion it pecuniary injury, and in such a case an action may be maintained by the corporation without proof of any special damage.” (§ 263.) (See, also, Shoe & Leather Bank v. Thompson, 18 Abb. Pr. 413; Mutual Reserve Fund L. A. v. Spectator Co., 18 J. & S. 460.)

It is urged that without the innuendo, the matter averred is not libelous.

The rule that the meaning of words in an alleged libel cannot be extended by innuendo beyond their fair import, aided by extrinsic facts with which they are connected, is invoked.

It is claimed that it operates to prevent any consideration of the innuendo, and hence a cause of action is not alleged.

The true rule doubtless is that in such a case the court will inquire whether the innuendo is warranted by the language used, considered in connection with the other facts to which they have relation, and if found not to be warranted, the demurrer will be sustained, unless the words without the innuendo. are actionable. (Fleischmann v. Bennett, 87 N. Y. 231.)

The second portion of the innuendo, which alleges that the meaning of a portion of the article was, “ That by reason of the publication plaintiff was forced to discontinue business,” is clearly libelous. And the question then is whether such innuendo is fairly warranted by the publication complained of. If so, it follows that a cause of action is alleged. While,- as we have seen, a corporation, as well as an individual, may have redress for injury done to its reputation, and where the matters complained of are of the character presented here each has precisely the same standing to recover for the wrong inflicted, yet the meaning of the language employed seems to be more readily apprehensible, if the name of an individual be substituted in the place of a corporation.

For that reason we shall substitute for the purpose of a brief discussion, the words “James Jackson,” in the place of “the Arrow Steamship Company.” Then in an article headed “ Real Progress in the South versus Booms,” we find it stated that “ when James Jackson went fishing for stray twenty-dollar bills, we looked through the little scheme, and told what we saw.”

Pausing for a moment to measure the impression which the language so far quoted makes, we find that the inference is clearly suggested that the scheme which the defendant saw through, and which it felt called upon to tell about, was not a creditable one.

This impression is strongly confirmed by the next sentence. After stating that it had told what it saw, the article continues:

“James Jackson was not pleased. He even accused us of misstating facts.”

So far, then, the inference may be drawn, indeed it is required, that the article intended to inform the public that the scheme in which James Jackson was engaged was of such a character that it prompted defendant to look into it, and publish the facts, which were of such a nature that James Jackson denied them, which he would hardly have taken the trouble to have done had they not been harmful to him. But, while he accused us of misstating the facts, said the defendant: He packed up his gripsack, all the same, and started for a healthier clime.”

Does not this assertion fairly warrant the innuendo that the effect of the publication was to compel Jackson to discontinue business in the place selected by him for that purpose % Of what other inference is it capable ?

From the statement as made, it would appear that James Jackson was attempting to do business of some kind, for it is alleged that he was looking for twenty-dollar bills, and while he was doing it, the defendant published such a result of its inquiries about his business and plans that, although he denied the accusation, still he packed up and went away. Clearly the inference is permissible from the language employed that, by reason of the publication of said article, he was forced to discontinue his business. The innuendo was, therefore, warranted.

The judgment should be affirmed, with costs and printing disbursements, with leave to the defendant to answer within twenty days after notice of the entry of the' order of affirmance, and upon payment of the costs of the judgment appealed from and this appeal.

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

Judgment affirmed, with costs and printing disbursements, with leave to the defendant to answer within twenty days after notice of the entry of the order of affirmance, and upon payment of the costs of the judgment appealed from and this appeal.


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    Joseph Rafolovitz, Appellant, v. The American Tobacco Company, Respondent.

      Demurrer — assumption that the complaint correctly states the facts as to the consideration of a contract — mutuality of contract necessa/rym

    Upon the review of a decision rendered upon tlie argument of a demurrer interposed to a complaint, it must be assumed that the complaint correctly states the facts, and that presumption attaches to its statement as to what constituted the consideration of an agreement, upon which the action was brought, as well as to its allegations in respect to other features thereof.
    An agreement was made whereby the defendant promised, in consideration that the plaintiff would purchase and sell a certain cigarette manufactured by it, that the defendant would allow and pay him as a compensation or commission for said purchase of cigarettes, twenty cents on every 1,000 thereof manufactured by the defendant and purchased by the plaintiff between certain dates, no other consideration being stated in the agreement, and thereafter the plaintiff did purchase a large number of cigarettes, upon which purchase the defendant paid the promised commissions and thereafter refused to sell any more cigarettes to the plaintiff.

      Held, that as there was no mutuality of contract the agreement was not enforcible, that it would have been otherwise had the plaintiff bound himself to purchase a given number of cigarettes.
    Appeal by tlie plaintiff, Joseph Rafolovitz, from a judgment of the Supreme Court in favor of the defendant dismissing the plaintiff’s complaint, entered in the office of the cleric of the city and county of New York on the 3d day of February, 1893, upon a decision of the court made after a trial at the New York Special Term, with notice of an intention to bring up for review on sucli appeal the interlocutory judgment entered in said clerk’s office on the 13th day of January, 1893, and the order or findings sustaining the demurrer to the plaintiff’s complaint, entered in said clerk’s office on the 11th day of January, 1893.

      Charles F. Holm, for the appellant.

      Oudin c& Oaldey, for the respondent.
   Parker, J.:

This case was well disposed of at the Special Term, and the argument supporting the disposition made was so fully presented as to render further consideration of the question discussed unnecessary.

The appellant now makes a point which does not seem to have been addressed to the Special Term, and in order to meet it it will be necessary to state briefly the conclusion reached by that court.

The pleader attempted to allege two distinct causes of action founded on two separate contracts. But while there were two contracts, they were in the same form, and but one need be quoted. As alleged it reads : “ On or about the 10th day of April, 1892, the defendant and Joseph Rafolovitz & Son * * * entered into an agreement or contract whereby and wherein the defendant promised and agreed, in consideration that said Joseph Rafolovitz & Son would purchase and sell a certain cigarette manufactured by defendant, that he, the defendant, would allow and pay them as a compensation or commission for said purchase of cigarettes twenty cents on every thousand of said cigarettes manufactured by defendant and purchased by said Joseph Rafolovitz & Son, between' the 10th day of April, and the 1st day of October, 1892.”

It seems that Joseph Rafolovitz & Son did thereafter purchase nearly 200,000 cigarettes, upon which purchase the defendant paid the promised commissions. Then it refused to sell to plaintiff any more cigarettes, hence this action.

The court held that there was no mutuality of contract, and, therefore, not enforcible. That it would have been otherwise liad the plaintiff bound himself to have purchased a given quantity of cigarettes.

That under the agreement, as alleged, it was optional with the plaintiff to purchase cigarettes or not. If, after making it, he had refused to take any, or after taking a few thousand, had declined to purchase others, the defendant could not have compelled him either to take cigarettes or respond in damages for not doing so. And as he made no promise, there was no basis for a consideration for the promise of the other party to the alleged agreement. In support of such position the court cited Chicago & Great Eastern Ry. Co. v. Dane (43 N. Y. 240) and Hrrd v. Gill (45 id. 341).

Appellant insists that Wells v. Alexander (130 N. Y. 642) upholds the agreement which he alleges, but we do not so understand it.

There the plaintiff proposed to furnish defendant’s steamers, naming them, with coal, at a price named, for the period of one year. The defendant accepted tlie offer, and thereafter plaintiff furnished to the defendant such quantity of coal as was required for the use of the steamships, until the defendant sold them. It was held that the proposal and acceptance, both of which were in writing, constituted a valid contract, there being entire mutuality, because one promised to take and pay for all that the other ageed to sell and deliver. The principal contention of the defendant in that case was, that the contract was one for successive deliveries of coal, to be made only when the defendant should give the plaintiff notice that a delivery was required, and as notice had not been given, the defendant was not in default. It was held that while at the date of the agreement the quantity was indefinite, it was nevertheless determinable by the terms of the contract, and, therefore, within the maxim “ Oertxim est quocl, certmn reddi potest; ” the necessity for notice was doubted, and it was asserted that if notice was required, a covenant on the part of the defendant to give it would be inferred, for otherwise the contract would be unreasonable, and place one of the parties entirely at the mercy of the other.

It will be seen, therefore, that the questions presented for decision in the two cases are entirely different.

The appellant calls our attention to a number of cases in which courts, having in mind the peculiar facts of the cases under consideration, have said that upDon a demurrer the consideration will be implied, and another line of cases holding that a consideration may be shown by extrinsic evidence, but those cases are not applicable here because the complaint undertakes to state the consideration.

It avers that the consideration moving to defendant was that Joseph Rafolovitz & Son would purchase and sell a certain cigarette manufactured by defendant. But, as stated, there was no pmomise on the part of Josepfii Rafolovitz & Son to purchase cigarettes, which was enforcible by defendant, and, therefore, it did not furnish a consideration for the defendant’s promise. Undoubtedly, if there had been some other consideration for defendant’s promise, moving from Joseph Rafolovitz & Son, defendant’s agreement could have been enforced, notwithstanding the absence of an obligation on the part of the plaintiff to pmrchase cigarettes.

So if the complaint had alleged that the agreement pleaded was founded upon a good and sufficient consideration, some of the cases to which the appellant calls our attention would be applicable. Under such an allegation the plaintiff upon trial would be permitted to show by extrinsic evidence the consideration for defendant’s promise. (Hurd v. Gill, 45 N. Y. 341.)

This was not done, presumably because it was not the fact. It must be assumed that the complaint correctly states the facts. And that presumption attaches to its statement.as to what constituted the consideration, as well as its allegations in respect to the other features of the agreement.

In disposing of the demurrer, therefore, it could not be inferred that some other consideration than that alleged in the complaint existed in fact, or could be proved on the trial.

The sufficiency of the alleged consideration was adequately discussed at Special Term, and with the conclusion reached we agree.

The judgment should be affirmed, with costs, but with leave to the plaintiff, on payment of the costs so far awarded against him, to amend his complaint within twenty days after service of notice of the entry of the order of affirmance.

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

Judgment affirmed, with costs, but with leave to the plaintiff, on payment of the costs so far awarded against him, to amend his complaint within twenty days after service of notice of the entry of the order of affirmance.


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    Adolph M. Bendheim, Respondent, v. James B. Morrow, Appellant.

      Mortgage to trustees • — proper satisfaction thereof — presumption that it was given in the proper discharge of their duties.

    Where from the terms of a mortgage, given to trustees for the protection of creditors of the mortgagor, it is clear that it was expected by the trust maker that the trustees therein named should have authority to collect and dispose of the moneys secured thereby, and to take all necessary steps to that end, authority is given to the trustees, in the due performance of their trust, to satisfy the mortgage, and a satisfaction thereof, given by such trustees, is presumed to have been a step taken by them in the proper discharge of the duties imposed by the trust.
    A purchaser of the property upon which such a mortgage is a lien, finding a proper discharge of such mortgage from such trustees upon record, is not called upon to inquire in what manner the satisfaction piece has been induced, and, in the absence of information to the contrary, may rely upon the presumption that the trustees did their duty.
    Appeal by tlie defendant, James B. Morrow, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the city and county of New York on the 8th: day of April, 1893, rendered upon a decision of the court after a trial at the New York Special Term.

      Sidney H. Stuart, for the appellant.

      Sol Kohn, for the respondent.
   Parker, J.:

If the record contained a complete statement of the facts this case could be more readily and satisfactorily disposed of by the court.

We shall be obliged, of course, to follow the findings and the evidence, but in doing it we shall not be unaware that there exists another fact, which, if present, might require that the case be treated differently. The plaintiff at public auction was the highest bidder for certain real estate, the legal title to which was in the defendant.

After the proj)erty had been struck down, a contract in writing between the plaintiff and defendant was duly executed, by which it was provided that the deed to be given should be subject to a first mortgage of $80,000, a second mortgage of $11,860, and an-indenture of lease to the Condensed Coffee Company. The plaintiff paid down, in pursuance of the terms of sale, $1,500, or twenty-five percent of the sum bid. He then caused the title to be searched, and discovered a third mortgage to four persons as trustees for' certain creditors of the mortgagor, their names, together with the several amounts due to them, appearing in schedules A and B of the mortgage. On the day fixed for the completion of the purchase, the plaintiff tendered the remainder of the purchase money, and demanded a deed in accordance with the contract of sale. At the same time the defendant presented a satisfaction piece of the mortgage executed in due form by the four persons named as trustees therein, and offered to cancel the mortgage of record. Plaintiff refused to accept the deed, claiming that the satisfaction piece was not sufficient to extinguish the lien of the mortgage, and said that he would not accept it, or pay the residue of the purchase money, unless there was first obtained a satisfaction piece of said mortgage, executed by the trustees and by all the creditors, beneficiaries and cestuis que fy'ust therein named, or a written consent to the cancellation, discharge and satisfaction of record of said mortgage, executed and acknowledged by all of the said creditors, beneficiaries and cestuis que trust.

Had the owner of the property gone to the trustees and paid to them the full amount of principal and interest secured by the mortgage, and received from them in return a satisfaction piece duly executed, as is the one before us, and placed the same on record, it would not be contended that the mortgage would not have been thereby discharged of record. Indeed, the respondent’s first point assumes that position to be correct. This concession, it will be observed, admits that in the due performance of their trust the trustees, and they alone, had authority to satisfy the mortgage. In so conceding counsel admits no more than the mortgage asserts, but his concession justifies us in refraining from calling attention to the provisions of the mortgage, which make it clear that it was expected by the trust maker, that the trustees should have authority to collect and dispose of the moneys which the mortgage was given to secure, and to take all necessary steps to that end. So, had the plaintiff in searching the title found the record of the mortgage to be discharged by a satisfaction piece, such as the defendant offered to cancel the record with, he would have been justified in making no further inquiries with regard to the matter, and would have been protected by the record against any claims by the creditors named in the mortgage, because of a failure on their part to receive from the trustees all or any portion of the moneys which the mortgage was originally given to secure.

An intending purchaser, it is true, is presumed to investigate the title, and to examine every deed or instrument forming a part of it, and must be deemed to have known every fact so disclosed. (Acer v. Westcott, 46 N. Y. 384.)

But an examination of the mortgage to the trustees would have disclosed that, in the discharge of their duties, they were expected and required to collect thereon the sum secured, and distribute it to the parties entitled thereto; that in the accomplishment of that purpose they had authority to execute and deliver a proper satisfaction piece. It would have further discovered to the inquirer special authority to satisfy the mortgage, in order that a new mortgage for a permanent loan might become the first mortgage, and to receive another mortgage to be placed on the property in lieu of the one so satisfied, and again, that in the event of part payment, satisfaction was authorized to be made, and a new mortgage for the balance given. And having thus ascertained from the instrument that the trustees, at the time of executing the satisfaction piece, had authority to do so, he would not have been called upon to inquire whether the satisfaction piece had been induced by the giving of a new mortgage ; by part payment, and a new mortgage for the remainder; by payment in full in cash, or whether they had received nothing, for the law presumes that trustees will do their duty, and a purchaser under such circumstances may rely upon that presumption in the absence of information to the contrary. The cases of McPherson v. Rollins (107 N. Y. 316) and Waterman v. Webster (108 id. 157), cited by the respondent, are not in conflict with this view.

In McPherson's case the trust created by the terms of the mortgage, which was executed in 18Y3, was to continue until 1880. The mortgage declared that it was intended as security for the payment of $250 annually to Deming individually, and fifty dollars annually to the general guardian of Florence McPherson on or before the fifteenth day of May in each year, until she should arrive at the age of fifteen years, and thereafter the further sum to said Deming, or guardian, of $100, payable annually, until Florence should arrive at the age of twenty-one years, for the benefit of Florence. There was a similar provision, although covering a different period, for a sister of Florence. A little over a year after the mortgage was executed Deming signed and executed a satisfaction piece. But the court held that it appeared upon the face of the mortgage that Deming had no power to receive payments in anticipation of the times fixed by the mortgage, which still had a. number of years to run, of which fact the purchaser must be presumed to have had notice.

In Waterman’s case the mortgage was executed to Joseph Waterman to secure the sum named, with interest, which was to be paid as follows: Interest on whole, sum to Sarah Waterman during life; after her death a portion of the principal was payable to Joseph Waterman, the residue to be invested in securities for the benefit of the children óf James Waterman, to be distributed when they respectively should arrive at age.

There was reserved to the mortgagor the right to have the mortgage discharged upon executing other securities upon the same condition. It was after the children of James became of age that Joseph received the money which led him to execute the satisfaction piece. He did not pay the money to the children, and in the action brought by them for a cancellation of the satisfaction piece, it was held that he had ceased to be a trustee, and had no authority to receive the payments, and that, as' the mortgagor acted in violation of the agreement embodied in his mortgage, he could not be deemed to have acted in good faith in making payment.

Although the satisfaction piece in this case had not been recorded at the time of the tender, the question actually presented for determination is not different in its legal effect than in the case we have supposed.

It was duly executed and needed only to be recorded in order to bring about a cancellation of the mortgage record. This the defendant offered to do, and no objection was made in respect to such offer other than that the satisfaction piece was not sufficient to extinguish the lien of the mortgage. The conduct of the parties leads us to suspect that, at the time of the execution of the satisfaction piece, the trustees had not been paid in full, and possibly that they had consented to an arrangement which they understood would prevent them from receiving all that the mortgaged interest was fairly worth, so that their conduct operated to wrong their oesi/uis que i/ntst, and was in the nature of a fraud upon them, of which facts the purchaser had knowledge.

If such was the case, an entirely different question would be presented than we have so far considered, for the presumption arising from the execution of the instrument satisfying the mortgage, to the effect that the trustees had proceeded in conformity with the duties imposed by the trust would have been overcome.

But as we cannot pass on suspicions, but only upon findings and ■evidence, we need not pursue this subject further. The findings nowhere assert that the mortgage had not been paid in full, nor do they, in the recital which they make of the objections interposed by the purchaser against taking the title offered, contain any intimation that it was assigned as a reason for the alleged insufficiency of the satisfaction piece.

Turning to the evidence adduced on the trial, we fail to find anything which would support a finding either way on that subject.

As the record stands, therefore, the only questions presented are two:

(1) Did the trustees have authority to satisfy the mortgage in the course of the due execution of the duties devolved upon them by the trust ?

(2) Does the presumption arise from the fact that they did execute the satisfaction piece that it was a step taken in the proper discharge of the duties assumed by them ?

The discussion already had requires an affirmative answer to both of these questions.

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

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

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