author: Follett, J.:

text:
    Ella D. George, Appellant, v. Josephine E. Carpenter et al., as Executors, etc., Respondents.

      Limited partnership — withdrawal of capital therefrom — allowance to the special partner of a claim against the pa/rtnership.

    Where a limited partnership expires and the special partner withdraws, leaving all of his capital and all of the firm assets in the hands of the general partners, under an agreement on their part to pay him the amount of his interest in the firm as settled and agreed upon, which they never do, there is not a withdrawal of the capital of the firm within the meaning of section 15 of 1 Revised Statutes, 766.

      Where the claim of a special partner is presented against the estate of a general partner, who has become liable to him by reason of his promise to pay a sum found to be due to the special partner, and the claim has been compromised, it cannot be said that the special partner has been allowed any claim against the limited partnership or its assets, in the absence of evidence that the funds wherewith the compromise was effected were derived, in whole or in part, from the assets of the limited partnership.
    Appeal by the plaintiff, Ella D. George, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the city and county of New York on the 11th day of August, 1893, upon the report of a referee dismissing the plaintiff’s complaint upon the merits and for costs.
    This action was brought for the recovery from the representatives of a deceased special partner of a debt due from his firm to the plaintiff.
    On the 3d day of Februai-y, 1885, Charles IT. George, Wilson II. George and Franklin E. J ames duly formed, pursuant to the statutes of this State, a limited partnership under the name of C. II. George & Co. (known in this litigation as No. 1), which was to begin February 4, 1885, and terminate November 13, 1887.
    Charles H. George contributed to the capital, $48,000; Wilson II. George contributed to the capital, $5,000; Franklin E. James contributed to the capital, $50,000; total capital, $103,000.
    Charles II. and Wilson II. George were the general partners and James was a special partner. The firm conducted the business which it was formed to carry on from February 4, 1883, to November 13, 1887, when it expired by the lapse of time fixed for its duration. At the last date mentioned a new firm was formed by the general partners of the old firm under the name of O. H. George & Co. (known in this litigation as No. 2) for the purpose of carrying on the same business, which was to continue from November 13, 1887, to January 1, 1889.
    On the 13th of November, 1887, the limited partnership was indebted to the plaintiff, who was the wife of Charles II. George, in the sum of $7,472.14, which is unpaid and is the only unpaid debt of the firm.
    November 13, 1887, the three partners agreed to the following statement of the old firm’s assets and liabilities, which was entered on its books:

      “ ASSETS.

      il Stock and Fixtures........................... $111,451.15
    «W. H. George, Cap. <jb....................... 11,108.62
    “ Outstanding <^s., collectible................... 45,771.23
    “ Cash Balance forward......................... . 4,327.28
    “ $172,658.28
    ' LIABILITIES.
    “ F. E. James, Cap. afc ■.. ,732.76

      “ C. H. George, Cap. a/cs., 34,972.25
    “ Ella D. George, loan a¡a. $7,472.14

      “ James, Briggs & H., do. 39,762.79 -- 47,234.93
    “ Rent due to date..... 4,000.00
    “ Bills Payable.......... $7,220.51
    “ Outstanding cjcs to pay. 21,497.83 28,718.34
    : $172,658.28 ”
    The stock and fixtures of the old firm, valued at $111,451.15, and the amount due from "Wilson H. George, $11,108.62, were assigned and transferred to the new firm, which two items amounted to $122,559.77. The new firm credited on its books James with the amount of his interest in the old firm, $57,493.32, which is a reduction of $239.44 from the amount appearing by the statement to be his due (why this discount was made does not appear) and Charles H. George with $34,972.25, and C. II. George & Co. (No. 1) with $30,094.20, which three items amount to $122,559.77, and equal the value of the stock and fixtures and the amount due from Wilson II. George to firm No. 1.
    At the time of the termination of the limited partnership, James received no money nor property. November 5, 1888, Wilson 11. George died insolvent, and June 14, 1889, Charles H. George died insolvent, leaving a will which was probated and of which the plaintiff, his widow, is the executrix.
    July 30, 1890, Franklin E. James verified and presented to the plaintiff, as executrix of the estate of her husband, the following account:

      “ The Estate of Charles H. George, deceased, to Franklin E.
    James, Dr., .
    “ 1st, to Balance due Franklin E. James from C. H.
    George, February 4th, 1885..........'........... $1,087.66
    “ Interest thereon from Feb. 4th, 1885, to June 14,
    1889......................................... 284.60
    “ 2nd, to balance due Franklin E.
    James from Charles H. - George,
    Nov. 14th, 1887................ $54,242.63
    “Interest on same from Nov. 14th,
    1887, to June 14th, 1889, nineteen
    months, at six per cent....'...... 5,153.05
    --• 59,395.68
    “ 3rd, to balance due Franklin E.
    James from C. H. George, Nov.
    12th, 1887..................... $39,692.47
    “ To interest on same at six per cent from Nov, 12th, 1887, to June
    14th, 1889..................... 3,784.02 ■
    -- 43,476.49
    “ $104,244.43 ”
    Before the presentation of this account James had become the sole owner of the amount credited to James, Briggs & PI. in the statement of liabilities, and the balance due thereon is included in the foregoing claim.
    December 16, 1890, James died leaving a will which was duly-probated and letters testamentary were issued thereon to the defendants. In May, 1890, the plaintiff, as executrix of her husband’s estate, paid to the defendants $52,000 on the above claim and received a release of all claims and demands due from her husband’s estate to the estate represented by the defendants. This action was. begun November 4, 1891.

      Ed/wa/rd B. Whitney, for the appellant.

      Cha/rles Mae Veigh, for the respondents.
   Follett, J.:

The plaintiff seeks to recover on two grounds: (1) That defendant’s testator withdrew his capital stock in violation of 1 Revised Statutes, 766, section 15, which provides: “No part of the sinn which any special partner shall have contributed to the capital stock shall be withdrawn by him, or paid or transferred to him, in the shape of dividends, profits or otherwise at any time during the continuance of the partnership.” (2) That defendant’s testator was allowed to claim as a creditor in violation of 1 Revised Statutes, 767, section 23, as amended by chapter 111 of the Laws of 1857, which provides: “ In case of the insolvency or bankruptcy of the partnership, no special partner shall, except for claims contracted pursuant to section 17, under any circumstances, be allowed to claim as a creditor, until the claims of all the other creditors of the partnership shall be satisfied.”

Section 17, referred to in section 23, provides: “ He (a special partner) may also loan money to, and advance and pay money for the partnership, and may take and hold the notes, drafts, acceptances and bonds of or belonging to the partnership, as security for the repayment of such moneys and interest, and may use and lend his name and credit as security for the partnership in any business thereof, and shall have the same rights and remedies in these respects as any other creditor might have.”

The referee found on conflicting evidence that the limited partnership was solvent on the 13th day of November, 1887, which finding we affirm.

The evidence shows that Charles H. George and Wilson H. George, the general partners of the limited partnership, undertook the duty of settling the affairs of the firm, and that they proceeded so far as to pay ofl; all its debts, except the one owing to the plaintiff. It is asserted that in case a limited partnership expires, and the special partner withdraws leaving all of his capital, and all of the firm assets, in the hands of the general partners upon their agreement to pay to him the amount of his interest in the firm as settled and agreed upon, which they never do, that it amounts to a withdrawal of capital within the meaning' of section 15 above quoted. This proposition cannot be sustained. Under the statute the general partners are required to manage tbe affairs of tbe firm, and when tbe special partner, at the termination of tbe period for which the partnership is formed, leaves all of bis capital and all tbe assets of the firm in the hands of his solvent general partners and takes their joint promise to pay him his interest in the firm, which they never pay, that does not amount to a withdrawal of capital or of assets within the meaning of the section. This precise question was decided in Lachaise v. Marks (4 E. D. Smith, 610). In that case a limited partnership bad existed under tbe name of Lord & Brown, but before tbe expiration of the time limited for its duration the special partner sold to the general partners all of his interest in the firm and entered into an agreement dissolving it. Notice of the •dissolution was filed, recorded and published as required by statute. The general partners assumed to pay all of the liabilities of tbe firm, and gave to the special partner their notes for $17,000 for his interest, signed Lord & Brown, which was the name of a new general partnership organized to carry on the same business. It was held that tbe giving of tbe notes did not amount to a withdrawal of any part of tbe capital or assets of tbe firm. Tbe judgment at General Term in tbe case cited was written by tbe late Judge Woodruff, in which all of his associates concurred, and it has never been questioned. In the ease at bar the promise, by tbe new firm, to pay to the withdrawing special partner the amount of his interest in the limited partnership, did not withdraw any assets from it, nor did it create any obligation against it. The assets of the old firm were left in the custody of tbe general partners subject to the claims of the creditors, and the liability created was against Charles H. George and Wilson H. George.

The old firm was most effectually dissolved: First, by the lapse of time during which it was to continue, and the agreement of the partners, and afterwards, November 5,1888, by the death of Wilson II. George, one of the general partners.

Nor have the provisions of section 23, above quoted, been violated. Neither the special, partner nor his representatives have been allowed any claim against the limited partnership or its assets. The claim presented and compromised was against the estate of Charles H. George, who became liable by virtue of his promise to pay the sum found due to the special partner, and there is not the slightest evidence that the funds wherewith this compromise was effected were derived, in part or in whole, from the assets of the limited partnership; and

The referee has not found that the limited partnership had not sufficient funds on hand, at the date of the death of Charles H. George, to pay the claim of this plaintiff, nor was any attempt made to establish such a proposition. It is found that Charles H. George was insolvent when he died, which is not equivalent to finding that the limited partnership was then insolvent, which could not be shown without ascertaining whether it had sufficient assets on hand to pay its only liability, the plaintiff’s claim. On this branch of the ease the referee found: “Twenty-second. That the entire amount of the capital invested by Franklin E. James in the special partnership remain in the hands or under the control of Charles H. George and Wilson H. George jointly, or of Charles H. George solely, from November 13, 1887, to June 4, 1889.”

We assume that the date June 4, 1889, is a misprint for June 14, 1889, the date of the death of Charles H. George.

The judgment should be affirmed, with costs.

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

Judgment affirmed, with costs.


source: Caselaw Access Project

author: Van Brunt, P. J.:

license: Public Domain

text:
    Charles P. Hemenway and Another, Respondents, v. Morris F. Knudson and Others, Appellants.

      Commission to examine witnesses on written interrogatories — commissioners and witnesses must be named therein.

    By force of section 887 of the Code of Civil Procedure the authority of the court to direct the issuance of commissions to take testimony out of the State of New York upon written interrogatories is limited to commissions in which the commissioners and witnesses are named.
    This section of the Code is not open to a construction which will permit witnesses to he examined though not named in the commission, provided the application for the commission shows that their names are unknown and could not by reasonable diligence be ascertained, and identifies them in a proper manner.
    The court has no authority to direct the issuance of such a commission “to the officer exercising the functions of United States consul" at a certain place, ■without naming him.

      Appeal by tbe defendants, Morris F. Knudson and others, from so much of an order of the Supreme Court, made by the New York Special Term and entered in the office of the clerk of the city and county of New York on the 24th day of May, 1893, “ as directs that the plaintiffs have leave to return the commission heretofore issued herein to Valparaiso, Chili, and partly executed, to the officer exercising the functions of United States consul at Valparaiso, Chili, without naming such officer,* from so much of said order as directs that a commission issue to the officer exercising the functions of United States consul at Iquique, Chili, without naming such officer; from so much of said order as directs that a commission issue to examine unnamed representatives of the firm of James Inglis & Company, and to examine John Doe, Richard Roe and Thomas Smith, fictitious names used to designate witnesses whose true names are not stated.”

      O. A. Black, for the appellants.

      J. 8. Melcher, for the respondents.
   Van Brunt, P. J.:

The order in this case provided : First, for the return to Corvis M. Barry, United States consul at Valparaiso, Chili, orto the officer exercising the functions of consul at that place, of a commission which had been theretofore partly executed; second, for the issuing of a commission directed to J. V. Merriam, United States consul at Iquique, Chili, or to the officer exercising the functions of consul at that place, as commissioner to examine on oath upon written interrogatories to be annexed thereto, T. F. Edmundson of Caleta Buena, Chili, or such other representative of the firm of James Inglis & Co., whatever his name, etc., and of John Doe as a witness to certain facts; and also Richard Roe and Thomas Smith as witnesses to certain other facts, all of whose names were unknown to the plaintiffs. The defendants appealed from this order upon the ground that the commissioners are not named, and that the commission to Iquique is to examine certain witnesses whose true names are not given.

It is urged that the statute in regard to commissions should have a reasonable construction, and that witnesses may be examined, though not named, provided the application shows that their names are unknown and could not by reasonable diligence be ascertained, and identifies them in a proper manner. And it is claimed by the respondent that certain authorities support this proposition.

But as the authority of the court to award a commission depends solely upon the statute, it is beyond the power of the court to interpolate into the statute that which has been carefully excluded.

By section 887 of the Code it is provided when a commission nr-y issue. The language of the section is as follows: “ A commission may be issued to one or more competent persons named therein authorizing them or any one of them to examine the witness or witnesses named therein under oath, upon the interrogatories annexed to the commission.”

This language is too plain for construction. The commissioners must be named and the witnesses must be named, if the commission is to be upon written interrogatories as in the case at bar.

It follows, therefore, that these mythical commissioners and mythical witnesses cannot have authority conferred upon them either to act or to testify by the order of the court appealed from.

The order should be reversed in the respects appealed from, with ten dollars costs and disbursements.

Follbtt and Parker, JJ., concurred.

Order reversed in the respects appealed from, with ten dollars costs and disbursements.


author: Yan Brunt, P. J.:

text:
    Thomas F. Tobin, as Executor, etc., of Mary J. Cocke, Deceased, Appellant, v. Edward C. Kirk and Salathiel H. Tobey, Respondents, Impleaded with Thomas H. Cocke and William S. Relfe, as Receiver of The Life Association of America.

      Principal and surety — subrogation.

    A surety, upon payment of the principal’s obligation, becomes subrogated to all the rights of the principal in respect thereto, and when the consideration for the obligation paid by the surety has been wrongfully and fraudulently diverted from the principal and converted by a third party, the wrongdoer is bound to respond to the surety, being the person immediately injured, no matter how many intervening rights may be called into play to enforce this result.

      Appeal by the plaintiff, Thomas "F. Tobin, as executor, etc., of Mary J. Cocke, deceased, from a judgment of the Supreme Court sustaining the demurrer of the defendants, Edward C. Kirk and. Salathiel H. Tobey, to the plaintiff’s complaint and dismissing, the complaint, entered in the office of the clerk of the city and county of New York on the 3d day of July, 1893, upon a decision of the court after a trial of the issues of law at the New York Special Term.

      T. B. Turley and A. Walker Otis, for the appellant.

      J. W. Perry, for the respondents.
   Yan Brunt, P. J.:

The complaint alleges that in June, 1872, one Thomas H. Cocke and one John S. Hatcher were copartners in business at Memphis, Tenn., under the firm name of J. S. Hatcher & Co.; that in July, the Life Association of America agreed to loan to said Cocke $10,000 on a note for that sum made by him and his wife (plaintiff’s testatrix), payable three years after date to the order of said association, secured by a mortgage or trust deed upon the separate estate of plaintiff’s testatrix, but with the express understanding that the money so borrowed was not to be paid over by said association until the 15th day of October, 1872, and thereupon said note and mortgage were executed and delivered to- said association by said Thomas H. Cocke and wife.

The complaint further alleged that pursuant to an agreement made between J. S. Hatcher & Co., Thomas H. Cocke, the Life Association of America and the defendant Tobey, and in order to effectuate the loan aforesaid, the defendant Thomas H. Cocke drew his draft for $10,000 on said the Life Association of America, dated July 6, 1872, due October 15, 1872, payable to the order of said J. S. Hatcher & Co., which said draft was accepted by said the Life Association of America, indorsed by the payees, and by the joint act of the parties aforesaid deposited in the personal custody of defendant Tobey, upon the express understanding and promise made by the said Tobey to the said Life Association of America, as well as to the other parties aforesaid, that the said Tobey should not have any title to said draft, but that his relation thereto should be that of a personal custodian, only, and that it should not leave his possession or be put into circulation, it being the intention of the parties that it should remain in the personal custody of defendant Tobey, without any validity as commercial paper, until the 15th day of October, 1872, when said the Life Association of America should receive back said draft and pay to said Thomas II. Cocke said sum of $10,000 so agreed to be loaned as aforesaid.

The complaint further alleged that in violation of said agreements, and with the intent to defraud the parties thereto, defendant Tobey, with the assistance and connivance of defendant Kirk, negotiated said draft before maturity to innocent holders, receiving therefor the sum of $10,000, which sum of money they, the said Kirk and Tobey, wrongfully converted to their own use.

The complaint further alleged that by reason of the wrongful acts of defendants Kirk and Tobey in placing said draft in circulation said Life Association of America was sued thereon h}1" the holder thereof, and under compulsion of legal process after final judgment in said action paid the amount of the same to the holder ; that upon payment of the said sum by said life association it demanded from the defendant Cocke the payment of said sum of $10,000, but Cocke neglected and refused to pay the same; that thereupon the life association foreclosed the mortgage upon the property of the plaintiff’s testatrix, and such proceedings were had that a decree was duly entered for its sale, and thereafter said separate estate was sold under the decree for a sum sufficient to satisfy said decree in full; that on the 1st of January, 1873, the firm of J. S. Hatcher & Co. was dissolved and its debts paid, and subsequently thereto said Hatcher departed this life, leaving said defendant Cocke the sole surviving partner of said firm; that plaintiff demanded from defendant Cocke the payment of the sum which the estate of his testatrix was compelled to pay as surety, but he has refused to pay the same.

A judgment was thereupon demanded declaring that said life association had a right of action against the defendant and Kirk and Tobey for the amount so paid, and that the plaintiff, as executor of said Mary J. Cocke, is entitled to be substituted and subrogated to such rights and remedies, and that the defendants Kirk and Tobey account for the money received by them to the extent that the plaintiff, executor of Mary J. Cocke, has been compelled to pay by reason of the suretyship of his testatrix as aforesaid, with interest and expenses.

To this complaint the defendants demurred «pon the ground that it did not state any cause of action.

There is no doubt upon this state of facts that the action of Tobey and Kirk, in disposing of this draft, was a conversion of the same, and they became liable for the damages arising from such conversion. The result of this transaction is that they have stolen the money realized upon the draft in question, and appropriated it to their own use without the slightest right or authority.

Whatever may be said in regard to the forms which were used to attain the end, it is clear that the whole intention of this transaction was to place it upon such a footing that the association, on the 15th of October, 1812, could be compelled to pay to Thomas H. Oocke the sum which they had agreed to loan him upon his and his wife’s note, taking as security therefor a mortgage upon the real estate of plaintiff’s testatrix. Now, by the illegal and fraudulent acts of Tobey and Kirk, the Life Association of America has been compelled to pay this money to other persons; they have not kept their contract with Oocke and paid him the money which they agreed to pay him; and the object and inducement which caused the wife of Oocke to become his surety has been entirely defeated. And yet the respondents claim that there is no remedy for such a wrong. It seems only necessary to state the proposition in order that the answer may come that thieves have no title to stolen property. The plaintiff’s testatrix has been compelled to pay out of her estate the amount of this mortgage without a dollar of consideration ever having been received therefor, except such as the defendants in this action have received in violation of their agreement, and converted to their own use. It seems to be apparent that her estate is entitled to be reimbursed; and that the parties who were guilty of the fraud are bound to respond to the party who is immediately injured, no matter how many intervening rights might have been called into play to enforce this result. By reason of the fraudulent action of the defendants, the consideration to the plaintiff’s testatrix for the mortgage which she gave to the life association entirely failed, and yet she has been compelled to pay the mortgage. We say entirely failed because it appears upon the face of the complaint that the consideration for the execution of that mortgage was a loan to be made by the life association to her husband, evidenced by thé draft which the life association "has been compelled to pay to an innocent holder; and although the wife’s estate has been compelled to pay the mortgage, the husband has received nothing, and the defendants without a shadow of right now hold, use and enjoy the money, the payment of which this mortgage was given to secure. The plaintiff’s testatrix was a surety in this transaction, and whatever rights the life association or her husband might have had to recover the proceeds of the draft in question from the defendants, upon the payment of the mortgage she became in law subrogated thereto. It is too familiar a principle to require the citation of authorities, that a surety upon payment of the principal’s obligation becomes subrogated to all the rights of the principal in respect thereto.

¥e think, therefore, that the demurrer should have been overruled, and that the judgment must be reversed, with costs of the appeal and of the court below, the defendants to have leave to answer upon payment of such costs within twenty days from the entry and notice of the order upon this decision.

Follett and Parker, JJ., concurred.

J udgment reversed, with costs of the appeal and of the court below, the defendants to have leave to answer upon payment of such costs within twenty days from the entry and notice of the order upon this decision.


text:
    Joseph S. Bryce, Respondent, v. Louisville, New Albany and Chicago Railway Company, Appellant.

      Pleading — guaranty of railroad bonds by another company — demurrer on the ground, oj ultra vires, defeated by an averment of authority.

    The averment of a complaint, in an action brought to recover from a railroad company upon its guaranty of the bonds of another railroad company, that the indorsement of guaranty was made by the defendant “having authority so to do,” is the allegation of a fact and not of a conclusion of law, and saves the complaint from demurrer on the ground that upon its face it does not state facts sufficient to constitute a cause of action in that it discloses that the guaranty was ultra vires.

    Appeal by the defendant, the Louisville, New Albany and Chicago Railway Company, from an interlocutory judgment of the Supreme Court, overruling the defendant’s demurrer to the plaintiffs complaint, entered in the office of the clerk of the city and county of New York on the 25th day of May, 1893, upon an order to that effect made by the court after a trial of the issue of law at the New York Special Term.

      E. D. Eaw7cms, for the appellant.

      W. P. CTiambers, for the respondent.
   Van Brunt, P. J.:

The complaint alleges the incorporation of the defendant under the laws of the State of Indiana and the incorporation of the Richmond, Nicholasville, Irvine and Beattyville Railroad Company, under the laws of Kentucky, and that theretofore the said last-named company duly made and executed, for value received, its negotiable coupon bond in writing bearing date the 1st day of July, 1889, whereby it promised to pay to the Central Trust Company or bearer, the sum of $1,000 with interest at six per cent payable semi-annually on the presentation and surrender of the coupons thereto annexed, and thereupon delivered said bond with the interest coupons thereto annexed to the Ohio Valley Improvement and Contract Company or to its order; that upon the execution of the bond the same was certified by the Central Trust Company as trustee; and that thereafter an instrument of guaranty of the payment of said bond and interest was indorsed on said bond by the defendant; and

“ That said indorsement of guaranty was so made by defendant, having authority so to do, for value received, and the same was so made, executed and delivered under and in pursuance of the direction of its board of directors.”

The complaint further alleged that said bond so certified and guaranteed as aforesaid was sold to him for the sum of $900 by the then president of the defendant, and “ That on the 1st day of July, 1891, there became due for interest on said bond the sum of thirty dollars; on tlie 1st day of January, 1892, tlie further sum of thirty dollars, and on the 1st day of July, 1892, the further sum of thirty dollars, for all of Avhieli sums coupons were annexed to said bond; * * * the said coupons were duly presented for surrender and payment * * * but said company refused and neglected to pay the same * * * that thereupon notice of such default was duly givén to the defendant.” The complaint also contained causes of action upon other similar bonds.

The defendant interposed a demurrer to the complaint upon the ground that upon its face the complaint does not state facts sufficient to constitute a cause of action.

This demurrer was overruled, and from the judgment thereupon entered this appeal is taken.

It is now urged in support of said appeal that the defendant had no power to guarantee the bonds of railway companies in other States, of which the plaintiff had presumptive notice, and that the defendant’s alleged guaranty was for the accommodation of the railroad company executing the said bonds, and that the plaintiff was charged with notice by reason of the facts alleged with reference to the purchase of bonds. These grounds really result in the plea that the making of the guaranty was ultra vires of the defendant corporation.

Whatever may be the result upon the trial, it is clear that no such ground can be claimed here in view of the allegations contained in the complaint.

The averment is that this indorsement of guaranty was so made by the defendant having authority so to do, for value received, and the same was so made, executed and delivered under the direction of its board of directors.

It is urged that this allegation is a mere conclusion of law. But in this, we think, the learned counsel for the appellant is mistaken. It is the allegation of a conclusion of fact; and facts, not evidence, are to be alleged in a cpmplaint. The question of authority is one of fact, although the existence of such fact may depend upon questions of law. As, for example, whether A. is the agent of B. is a question of fact. But whether certain facts constitute A. such agent may be a question of law. The existence of the agency, however, is nevertheless a question of fact.

It follows, therefore, that in view of the allegations of the complaint the demurrer is not well taken, and the judgment must be affirmed, with costs, and with leave to withdraw the demurrer and answer on payment of the costs and disbursements of the appeal and costs in the court below.

Eollett and Parker, JJ., concurred.

Judgment affirmed, with costs, and with leave to withdraw the demurrer and answer on payment of costs and disbursements of the appeal and costs in the court below.


text:
    Baptist M. Comer and Others, Respondents, v. Alexander Mackey, Appellant.

      Action tried by the cou/rt — appeal upon the judgment roll only — assumptions as to the evidence — necessity of findings justifying the judgment — account stated — estoppel from right to surcharge, by reason of acquiescence.

    Upon an appeal in an action tried by the court or a referee, where no case is made containing the evidence, but the appeal is based solely upon exceptions contained in the judgment roll, and the findings of fact do not sustain the conclusions of law, it may not be assumed that there was evidence justifying other findings which would have sustained such conclusions , but, on the contrary, it is to be assumed that there was no such evidence, and when the conclusions of law have been properly excepted to, the judgment may not be sustained.
    Hence, upon an appeal upon the judgment roll only, in an action tried by the court or a referee, the General Term is to consider whether such facts were found as justified the judgment entered, and not whether such facts might net have been found as would have justified such judgment.
    When a person having a business arrangement with a firm, receives and retains without objection a series of statements of account rendered to him by the firm, and the firm is dissolved and a new firm succeeds to its business, the members of which in good faith, relying upon the statements of account so previously rendered, change their position by allowing certain parties to retire, and by settling with them upon the basis of such accounts, by reason of the apparent acquiescence and consent to their correctness by the person to whom they were rendered, that person will not thereafter be permitted to impeach and surcharge those accounts for the purpose of charging the new firm with any error which may have inadvertently crept into the accounts prior to the dissolution of the old firm, and been permitted to pass unquestioned through his own negligence in not informing himself of the condition of the accounts which were rendered to him from time to time.

      Appeal by tbe defendant, Alexander Mackey, from a judgment of tbe Supreme Court in favor of tbe plaintiffs, entered in tbe office of the clerk of tbe city and county of New York on tbe 9 th day of January, 1891, upon the report of a referee.

      J. A. Shou&y, for the appellant.

      W. M. Kosebault, for the respondents.
   Yan Brunt, P. J.:

This action was brought upon an alleged account stated. The answer, while admitting tbe copartnership of tbe plaintiffs as alleged, denied that any account bad been stated between the parties, but admitted that an account bad been rendered by tbe plaintiffs upon tbe day upon which it was alleged the account had been stated showing tbe balance claimed, and alleging that he had not then the means of ascertaining whether the same was correct or not, and he denied that be ever assented to tbe correctness thereof. The answer further set up various defenses and counterclaims by which the defendant claimed to surcharge the said account stated for errors in respect to interest, and demanded an accounting, claiming a large balance to be due. To the counterclaim a reply was duly interposed.

The issue thus raised having been referred to a referee to hear and determine after the trial, the referee reported in favor of the plaintiffs for an amount much below that which was claimed in the complaint, and from the judgment thereupon entered this appeal is taken by the defendant.

No evidence is presented, and this appeal must be considered, therefore, upon the judgment roll alone, and the only question which it is necessary to consider is whether the findings of fact made by the referee support his conclusions of law.

It is claimed upon the part of the respondent that every presumption exists in favor of the judgment, and since the appellant has failed to print the evidence, or any part of it, it must be assumed that it would not have benefited him to do so, and that the record not only sustains the findings of fact actually found, but is also sufficient to sustain any additional findings required to support the conclusions of law, unless those conclusions are in conflict with the findings of fact. And he cites the cases of Kellogg v. Thompson, (66 N. Y. 88); Murray v. Marshall (94 id. 616), and Gardiner v. Schwab (110 id. 650). Those cases pointedly sustain the contention of the respondent. Our attention is, however, called by the appellant to the case of The Rochester L. Co. v. Stiles & Parker P. Co. (135 N. Y. 209), in which case the court held that upon an appeal in an action tried by the court or a referee, where no case is made containing the evidence, but the appeal is based solely upon exceptions contained in the judgment roll, and the findings of fact do not sustain the conclusions, it may not be assumed that there was evidence justifying other findings which would have sustained such conclusions, but, on the contrary, it is to be assumed that there was no such evidence, and when the conclusions of law have been properly excepted to, the judgment may not be sustained — a construction of the practice which seems to us absolutely contrary to that which was laid down in the cases above cited, but which also seems more consistent with reason, because it is evidently the duty of the party succeeding to see to it that he has findings of fact sufficient to support the judgment; and if he does not, he is exposed to the perils of a reversal upon appeal, based solely upon exceptions to the legal conclusions, as suggested by the court. If any other rule should be sustained, then ■ very rarely, if ever, would it be sufficient for a defeated party to appeal without a case, as it is nearly always possible to presume the existence of other facts which were not actually found, but which, if found, would uphold the judgment. The learned judge who wrote the opinion in the case last cited seems to recognize the fact that a new departure was being made, because he says in his opinion: “ The law upon this matter of practice by some inadvertence has fallen into some confusion and conflict, and it is time that the practice should be finally settled,” although it appeared by the cases first above cited to be distinctly settled in a different way.

Taking, however, the last construction of the court of last resort as our guide in the decision of the questions involved upon this appeal, we are to consider whether such facts were found as justified the judgment entered, and not whether such facts might not have been found as would have justified such judgment.

The referee finds that on the 6th of November, 1868, an agreement was entered into between the firm of Dowley, Corners & Co. on the one part, and the defendant, Alexander Mackey, and one Muller oil the other part, providing for a business adventure in which, both parties should be interested, Dowley, Corners & Co. to furnish the refinery therein mentioned, and capital sufficient for working the same, and the, defendant and Muller to furnish their patents and entire time and services; all outlay of money connected with the property and the working thereof to be borne by the business, except in the case of additions in the shape of entirely new improvements, the interest on a mortgage of $20,000 then on the premises to be borne by the business, and no rent or commissions upon purchases or sales to be charged unless actually paid out, and profits and losses to be divided or borne at the end of each year in the proportion of two-thirds to or by Dowley, Corners & Co., and one-third to or by the defendant and Muller. The agreement was to continue in force for three years from its date, at the end of which time Dowley, Corners & Co. were to have the privilege of extending it to the expiration of the patents, or for a shorter period, by increasing the interest of defendant and Muller to four-tenths of the profits.

At the time of the execution of this contract the refinery was being carried on under a previous arrangement between the same parties. It was continued for the period of three years, eliding the 6th day of November, 1871. It was further continued thereafter with no definite extension or new contract. But, in fact, from and after the 1st day of January, 1872, the share of the defendant in profits and losses was increased from one-sixth to one-fifth.

In 1875 the firm of Dowley, Corners & Co. was dissolved, and a new firm known as Corner Bros. & Co., consisting of the plaintiffs in this action, was thereupon organized and succeeded to the general assets, business and liabilities of Dowley, Corners & Co. The members of the old firm who were not members of the new firm retired and were settled with on the footing of the books and accounts as they then existed. Up to the time of such succession in 1875, Dowley, Corners & Co., and from the time of their succession Corner Bros. & Co., had rendered two statements to the defendant on or about the first day of January in each year. The one was a summary of the refinery business for the previous year and exhibited the balance of profit and loss and the share therein of each of the parties. The other was a detailed personal account of the defendant with the firm for the same previous year, and included his share of the profit and loss from the refinery account, and exhibited the balance to his credit or debit on such first day of January.

These personal accounts were continuous, carrying forward the balance from each year to the succeeding year. Both sets were regularly received and retained by the defendant without objection.

After the said succession of plaintiffs the refinery business was continued by the former in conjunction with the defendant and for a part of the time with Muller upon the same footing and without any new definite arrangement between them and the defendant or Muller until on or about the 15th day of October, 1880, when it was finally discontinued in accordance with notice to that effect given by Corner Bros. & Co. to the defendant. No objection to the discontinuance was then made by the defendant, who, on the contrary, had expressed his opinion of the inadvisability of proceeding without substantial alterations and improvements of machinery.

In making up the several refinery accounts, interest was reckoned not only upon the mortgage, but also upon what were known as the working and improvement accounts, and was charged or credited to the business and became an element of profit or loss stated for the apportionment between the'parties interested in the business at the end of each year. No part of the interest upon the working or improvement accounts was paid or received by either Dowley, Corners & Co., or their successors, the plaintiffs, the same being computed in their favor or against them, as the case might be.

The principal of the mortgage of $20,000 mentioned was paid off in installments. No part of such principal was ever charged to the business or in anywise paid by the defendant; nor does it appear that interest was ever fully realized by the plaintiffs upon- this principal.

There was no effort on ffche part of the plaintiffs or their predecessors to mislead the defendant respecting the character or method of the accounts, nor to withhold from him access to books or other means of information in regard thereto. He had mislaid his duplicate of the original contract, but did not seek to otherwise inform or- remind himself of his rights thereunder. At the same time he was not an expert accountant and his main reliance was upon the accuracy of the plaintiffs and their predecessors.

In the foregoing statement of the findings of fact of the referee, it has not been considered necessary to refer to figures, because the question involved upon this appeal does not relate to amounts, but to the principles upon which the referee has based his conclusions of law.

As conclusions of law, the referee found that under the contract interest was not chargeable to the business on the working account, nor on the improvement account, although in this last particular there may be room for doubt, inasmuch as the contract failed to make it the duty of either of the parties to supply improvements not chargeable to expense account. But interest was at all times chargeable to the business upon the $20,000 represented by the mortgage, and without regard to payments of principal thereof by Dowley, Corners & Co., or by the plaintiffs.

The referee also found, as conclusions of law, that “ the discontinuance of the business by the plaintiffs in the year eighteen hundred and eighty was without fault on their part such as to subject them to liability to the defendant for either penalty or damages. Moreover, the action of the defendant preliminary to and concurrent with the discontinuance, left him no right of subsequent complaint.”

The referee also found, as conclusion of law, that “ in view of the receipt by the defendant of the series of accounts rendered to him by Dowley, Corners & Co., and the absence of objection by him thereto^, and of the dissolution of the firm and the succession to the same by the plaintiff’s firm of Corner Brothers and Company, with material changes in membership and proportionate rights, and without notice that the accounts were in anywise unacceptable to the defendant, it would be inequitable to permit the defendant to now impeach these accounts for the purpose of charging the plaintiffs with a balance to defendant’s credit at the time of the succession larger or other than the balance then appearing in his favor by the accounts so theretofore rendered to him.”

And, further, that the sums charged by the plaintiffs upon the working and improvement account were erroneously charged; and that notwithstanding the great delay of the defendant in objecting thereto, nevertheless correction of the errors can now properly be made for the period since the 1st of January, 18Y5, that being the date when the plaintiffs succeeded to the firm of Dowley, Corners & Co.,

Tbe appellant, upon this appeal, contends that the referee erred in deciding that the appellant could not question the erroneous charges for interest made against him prior to January, 1875, and in holding that interest upon the $20,000 mortgage which had existed upon the premises was properly chargeable to the business after it was paid off.

The claim is made that the defendant, not being guilty of deception, either intentional or otherwise, could not be estopped from questioning the state of the accounts, and that if the plaintiffs desired to estop him because of the changes in their relations to their previous copartners, they should at least have informed him of their precise condition, and of wliat they proposed to do; but as they became successors of the prior firm without either consulting the defendant or giving him notice of the change, and they acquired the benefits arising from the succession, they must assume as well its burdens. In support of these propositions, our attention ig called to the cases of Welsh v. German Amer. Bank (73 N. Y. 424); Shipman v. Bank of State of N. Y. (126 id. 318), and Frank v. Chemical Bank (84 id. 209).

It is claimed that these cases go much further than is necessary to sustain the defendant’s position in this case. An examination of the cases, however, seems to show that they have no application whatever to the one at bar. They proceed upon the principle that a depositor owes no duty to a bank requiring him to examine his pass book and returned checks with a view to the detection of forgeries in the indorsements upon such checks; and it was held that he has a right to assume that his bank, before paying his checks, will ascertain the genuineness of the indorsement. The depositor has no means of ascertaining the genuineness of the indorsement before the bank pays out money upon the order of the depositor. It is the bank’s duty to ascertain whether or not it is paying the proper person, and it cannot shift that burden upon the shoulders of the depositor. But a very different question would arise if the signature of the depositor to the check upon which the money had been paid was claimed to be a forgery. In that case the depositor would be bound to know whether or not he had drawn the check in question.

In the case at bar, it appears that the plaintiffs, in entire good faith, relying upon the statements of account which had been furnished to the defendant as to the previous business which had been conducted, changed their position, allowed certain parties to retire, and settled with them upon the basis of such accounts; and it certainly would be a hardship now to compel them to pay the penalty arising from the defendant’s negligence in not informing himself of the condition of the accounts which were rendered to him from time to time. The business was conducted by the defendant with the plaintiffs after this change in the firm of Dowley, Corners & Co., to Corner Bros. & Co., and the accounts were received from the new firm precisely the same as they had been received from the old.

A very different question would arise had not the plaintiffs been placed in the position they now occupy by reason of the apparent acquiescence and consent to the correctness of the accounts by the defendant. Accounts stated undoubtedly may be surcharged for fraud or mutual mistake. But where it is inequitable that such surcharge should be allowed because of the change in the position of ■one of the parties to the account, in view of the acquiescence of the other, no such right exists.

It may indeed very well be questioned whether the present j>lain- ,. tiffs are responsible for all the indebtedness of the firm of Dowley, Corners & Co., as a firm, simply because they became their succes- . sors and took their assets.

We see no reason to differ from the referee in his conclusion that the plaintiffs are not responsible for any errors that may have inadvertently crept into the accounts prior to the dissolution of the ■old firm.

In respect to the interest upon the $20,000, it seems to us that when the plaintiffs paid that mortgage they became subrogated to the right to receive the interest on the $20,000, which, under the agreement between the parties, was to be borne by the business. It is true that the agreement provided that interest on the mortgage of $20,000 then on the premises was to be borne by the business, and that the mortgage was satisfied by the payment out of their own pockets by the plaintiffs of its amount. But, as already suggested, they clearly became subrogated to the right to receive interest as reserved in the mortgage upon the $20,000 advanced by them, and charge it to the business.

There seems to have been no error committed by the referee which calls for a reversal of the judgment appealed from, and the same should be affirmed.

Follett and Parker, JJ., concurred.

Judgment affirmed.


author: Per Curiam :

text:
    Frederick P. Forster, Respondent, v. Elizabeth Moore, Appellant, Impleaded with Others.

      Vacation of the appointment of atempora/ry receiver, in anaction to foreclose a junior mortgage — application of rents collected, to the payment of interest on a prior mortgage.

    When, after the vacation of an order appointing a temporary receiver, made pursuant to section 714 of the Code of Civil Procedure, on an order for service of the summons and complaint by publication, in an action brought to foreclose a junior mortgage, the same person is thereafter appointed receiver pendente lite, after personal service of the summons on the defendant, the mortgagor, and the interposition by him of an answer contesting the validity of the mortgage in suit, the receiver may be directed to retain the rents collected by him under his first appointment and to apply them to the payment of interest due on the prior mortgages on the premises.
    Appeal by the defendant, Elizabeth Moore, 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 28th day of April, 1893, denying her motion to compel a temporary receiver to pay rents collected by him to her.

      Robert J. Robeson, for the appellant.

      Hem/i'y A. Forster, for the respondent.
   Per Curiam :

This action was begun in February, 1893 (the precise date not appearing), for the foreclosure of a third mortgage on real estate, and on the twenty-seventh of that month an order was made directing that the appellant be served by publication, and on the same day James L. McNeirny was appointed temporary receiver, pursuant to section 714 of the Code of Civil Procedure. The summons and complaint were personally served on the defendant’s husband March 3, 1893, seven days after the order of publication was made, and on the appellant March 29, 1893. On the 14th of April, 1893, the order authorizing service by publication and the order appointing the receiver were vacated by the General Term. (68 Hun, 526.)

The order appointing the receiver is not a part of the record, nor are its terms disclosed. Prior to April 21, 1893, the receiver collected rents to the amount of $631.20 and had expended $128.55. On the 21st of April, 1893, a motion was heard in behalf of the plaintiff asking that McNeirny be appointed receiver, and that he-be allowed to retain the moneys collected under the prior order. On the same day a motion in behalf of the appellant was heard asking that the moneys collected by the receiver be paid over to her.

In one of the appellant’s moving affidavits it is averred: The defendants Moore have both answered the complaint herein denying the making of the alleged bond and mortgage described in the complaint upon which this action is brought, and deponent will use said pleadings on this motion.” The pleadings are not in the record. It is stated in an affidavit made by the defendant’s husband, on which the appellant’s motion was heard, “ that the interest on the first mortgages on said premises is due on May 1st, 1893, and deponent’s wife wishes to use the money which said McNeirny collected for the purpose of paying said interest, which is about $500.” The mortgaged property is a fiat, heated by steam, and occupied by tenants.

The plaintiff’s motion for the appointment of a receiver was granted, and the, receiver was ordered “to keep said premises in repair, to pay for gas, coal, also the taxes, assessments, water rates and interest on prior mortgages upon said premises.” The appellant’s motion was denied. Instead of the matter in controversy being disposed of by a single order, two were entered — one granting, the plaintiff’s motion and the other denying the appellant’s. From the latter order Mrs. Moore has appealed. It is evident that the court directed that the rents be applied on the prior mortgages, because the validity of the mortgage in suit was contested, and because Mrs. Moore in her moving papers stated that she wished so to apply the rents.

If the court should reverse the order appealed from and grant the motion, the order appointing the receiver would be left • standing, and there would be conflicting orders. It appears that the bond accompanying the mortgage in suit contains a clause that the mortgagee, in case of foreclosure, may take the rents by the aid of a receiver, but neither the bond nor mortgage are in the record, and we think, under a record which does not clearly disclose the rights of the parties, that we ought not to order the rents to be paid to the mortgagor. The order of the court directs the moneys to be applied precisely as the mortgagor stated in her moving papers that she desired to apply them, except the receiver is authorized to apply them in payment of taxes, assessments, water rates and current expenses. If the moneys collected by the receiver are applied on the prior mortgages, the desire of the mortgagor will be effected, and the rights of all parties will be protected pending the litigation.

The order appealed from should be modified by directing that the receiver apply all moneys collected by him under the first order in payment of any sums due on the prior mortgages, and, as so modified, affirmed, without costs to either party.

Present — Van Brunt, P. J., Follett and Parker,^JJ.

Order modified by directing receiver to apply upon prior mortgages all moneys collected by him under first order, and, as modified, affirmed, without costs.


author: Per Curiam:

text:
    Giles E. Leach and Philemon H. Andrews, Composing the Firm of Leach & Andrews, Respondents, v. Charles F. Linde, Appellant.

      Order of arrest — action ivpon a foreign judgment.

    By force of section 553 of the Code of Civil Procedure, an order of arrest is properly granted against the defendant in an action brought in the Supreme Court of the State of New York upon a judgment recovered in another State for damages caused by the false and fraudulent representations of the defendant.
    Appeal by the defendant, Charles F. Linde, 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 vacate an order of arrest.
    Section 552 of the Code of Civil Procedure is as follows: “ The recovery of judgment in a court, not of the State, for the same cause of action; or, where the action is founded upon fraud or deceit, for the price or value of the property obtained thereby, does not affect the right of the plaintiff to arrest the defendant as prescribed in this title.”

      JEckoard 8. Clinch, for the appellant.

      Lorenzo Semple, for the respondents.
   Per Curiam:

October 20, 1891, the plaintiffs recovered a judgment against the defendant in the Superior Court of "Wake county, in the State of North Carolina, for $6,398 damages, caused by the false and fraudulent representations of the defendant. The judgment has not been reversed and remains wholly unpaid, and this action is for the recovery of the amount due on it.

An order of arrest was granted which the defendant moved to vacate on the papers on which it was granted and so there was no dispute about the facts.

In Baxter v. Drake (22 Hun, 565 ; affd., 85 N. Y. 502) an action was brought in the Supreme Court of this State on a judgment recovered in the United States Circuit Court for the eastern district of Tennessee, for damages occasioned by the conversion of property. An order of arrest was issued in the action and it was held that under section 552 of the Code of Civil Procedure that it was properly granted. This section clearly authorizes an order of arrest in such a case.

It is urged by the appellant’s counsel that Gutta Percha & R. Mfg. Co. v. Mayor, etc. (46 Hun, 237; rev., 108 N. Y. 276), is in conflict with the case first cited. In that case it was held that a. judgment recovered in another State, it not appearing whether it. was founded on contract or in tort, was a contract within the meaning of section 635 of the Code of Civil Procedure, which prescribes cases 'in which attachments may be issued. The question •decided in the latter case is not germane to the one decided in the former, as the cases arose under different sections of the Code.

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

Present — Yan Brunt, P. J., Follett and Parker, JJ.

Order affirmed, with ten dollars costs and disbursements.


text:
    Beverhout Thompson, Appellant, v. Annie Stanley, as Administratrix, etc., of David A. Stanley, Deceased, Respondent, Impleaded with the Harris and Dew Faucet, Plug and Bung Company.

      iSuit by a stockholder of a corporation — proof as to present ownership of stock — assignment of stock purporting to be made by an administrator.

    No presumption that a plaintiff, who sues as a stockholder in a corporation, is still a stockholder, so as to entitle him to maintain the action, arises from proof, by the production from the papers of the corporation of a canceled stock certificate, that certain shares had once been issued to the plaintiff, that he had ■signed a blank power of attorney on the back of the certificate, and that the certificate had found its way back into the hands of the company and had been canceled, without any proof that such transfer was obtained from him without consideration or by false representations, although his complaint so alleges.
    The relation of stockholder is not established by the mere production of a corporation stock certificate on which is indorsed a blank assignment and transfer purporting to be signed by the administrator of the person named on its face as entitled to the stock represented thereby.
    Appeal by the plaintiff, Beverhout Thompson, from a judgment ■of the Supreme Court, entered in the office of the clerk of the city and county of New York on the 23d day of May, 1893, dismissing the complaint, upon a decision of the court after a trial by the court at the New York Special Term.

      L. Kwrge, for the appellant.

      F. Seymour, for the respondent.
   Yan Brunt, P. J.:

This action is brought by the plaintiff claiming to be a stockhólder of the defendant corporation on its behalf, to recover from the defendant Stanley, as administratrix, the proceeds of certain assets of the defendant corporation alleged to have been fraudulently misappropriated by her intestate while president of said corporation.

In his complaint the plaintiff alleged that in or about the year 1882 he subscribed for and purchased 138 shares of the capital stock of said corporation, and a certificate thereof was duly issued to the plaintiff, who became the owner thereof, and that the deceased David A. Stanley, who “ then owned or controlled the greater part of the stock of said corporation, was acting as its president and manager, and controlling its affairs, represented to plaintiff that, said corporation had determined to close up its business, and divide its assets among the stockholders entitled thereto, and in order to facilitate the same requested plaintiff to give to him (said Stanley) the control of plaintiff’s stock, stating that it would hasten and facilitate the closing up of the affairs of the coloration, and the realization by plaintiff of the share of its assets to which plaintiff was entitled, and promised and agreed, if ¡plaintiff would do so, to wind up the affairs of said corporation, sell its property, convert its assets into money, and that plaintiff should receive the proportion to which he was entitled.”

The complaint further alleges that the plaintiff, being ignorant as to the management and affairs of said corporation, and relying on the statements mad.e by said Stanley, deceased, as aforesaid, did in or about the month of February, 1886, execute to said Stanley an assignment of said one hundred and thirty-eight (138) shares of stock of said corporation, belonging to plaintiff as aforesaid; that plaintiff did not at that time, or has he ever, received any consideration whatever for said assignment of said stock, nor has said Stanley ever accounted to plaintiff or paid him anything whatever for his stock or interest in said corporation and its property.”

The complaint then alleges the ownership by defendant corporation of certain valuable ¡property, the appropriation of same to Ms own use by Stanley, the mismanagement of the affairs of the corporation, its cessation of business, and that since 1886 it had transacted no corporate business. It further alleges the death of Stanley, and the appointment of the defendant, Annie Stanley, as administratrix, and prays that she, as administratrix, as aforesaid, be directed to account for-tlie money, property and rights of said corporation received by said Stanley, deceased, or in any manner retained by him; and that said “ corporation defendant be required to account for any property, money or interest, if any, belonging to it or in -its control; that plaintiff be decreed entitled to and to be paid the amount he maybe found entitled to receive from said defendants, or either of them, and that the plaintiff may have such other or further relief as may be just and proper.”

The defendant, Annie Stanley, by her answer, substantially denied all the allegations of the complaint, and alleged ownership in said Stanley, deceased, of said 138 shares of stock.

Upon the trial, after the plaintiff had attempted to prove that he was a stockholder of said coi’poration, and after he had stated to the court that he had no further evidence to give upon that point, the court stopped the trial and dismissed the-complaint upon the ground that the plaintiff had not shown himself to be a stockholder, and from the judgment thereupon entered this appeal is taken.

We see no error whatever in the rulings made by the court below. The complaint showed that the 138 shares of stock which the appellant claimed to own had been transferred to Stanley, the allegation being that such transfer had been induced by false representations of Stanley and without consideration. No evidence whatever was attempted to be offered to support this allegation. All that the plaintiff did prove was, by the production of a certificate of stock from the papers of the corporation and marked canceled,” that 138 shares had been issued to him; that he had signed a blank power of attorney upon the back of said certificate, and that said certificate had found its way into the hands of the company again and had been canceled.

It is true that the plaintiff was asked whether he ever received any consideration from anybody for the transfer of that certificate. But this question was objected to upon the ground that its answer might involve testimony as to a transaction between the witness and the deceased, and was properly excluded upon that ground. And this was the only attempt in any way to prove the allegations in the complaint as to the circumstances under which the transfer was made.

Clearly, because the plaintiff had been a stockholder at one time, and it appeared that he had transferred his stock, no presumption. arises that he is still a stockholder because he alleges in the complaint that such transfer was obtained without consideration or by false representations. It was necessary that the plaintiff should at least prove these facts in order to entitle him to any standing whatever in court, even if that would suffice.

Upon the trial, the plaintiff attempted further to establish his-position as a stockholder by exhibiting a certificate for five shares of stock, which certificate showed that one Henry J. Ewing, of New York city, was entitled to five shares of stock in said company. Upon the back of this certificate was indorsed a blank assignment and transfer, purporting to be signed by Caroline A. Ewing, administratrix of the estate of Henry J. Ewing. The receipt of this certificate was objected to upon the ground that the execution of the assignment upon the back of this certificate was not proved in that the right of Caroline A. Ewing to make any transfer was not proved and also, even if such right existed, there ivas no proof in regard to her execution of the assignment and transfer; and the evidence was excluded, and properly so, because there was no proof going to show any transfer of this stock by any person having the ownership thereof.

There seems to have been, therefore, no error committed by the learned court in dismissing the complaint upon the plaintiff’s failure to prove his right to maintain the action.

The judgment should he affirmed, with costs.

Follett and Parker, JJ., concurred.

Judgment affirmed, with costs.


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

text:
    Charles Buek, Respondent, v. The Metropolitan Railway Co., and Others, Appellants.

      Action to recover damages to real property by reason of elevated, railroads — measure

    Upon tlie trial of an action brought to recover the damages to plaintiff’s prem ises alleged to have been sustained by the plaintiff by reason of the existence of certain elevated railroads and structures, and for other relief, the court was requested to rule, as a matter of law, that the plaintiff was not entitled to recover damages in the case, except to the extent, if any, by which the disadvantages of the defendant’s railroad had exceeded the advantages thereof to said premises. The court refused to so rule, and an exception was duly taken thereto.

      .'Ildd, that such refusal was erroneous, and that the judgment should be reversed.
    (Yan Brunt, P. J., dissenting.)
    Appeal by tbe defendants, the Metropolitan Elevated Railway •Company and others, 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 22d day of July, 1891, upon a decision of the court after a trial at the New York Special Term.
    The prayer for relief contained in the complaint in this action was as follows: “Wherefore, plaintiff prays that the amount of •damages sustained by him by reason of the existence of said railroad •and structure, may be ascertained, and that he may have judgment .against the defendants therefor, to wit, for the sum of eight thousand dollars; and that the defendants, and each of them, may be perpetually enjoined and restrained from further obstructing and incumbering the said Ninth avenue, and from making any further erection in said Ninth avenue in front of plaintiff’s premises. That said ■defendants may also be perpetually enjoined and restrained from maintaining, continuing or operating said railroad and structure now ■existing in said Ninth avenue in front of plaintiff’s premises, as above set forth, and compelled to take down and remove the same; ■and that plaintiff may have such other and further relief, with his •costs, as to the court shall seem equitable and proper.”

      Julien T. Davies and Bramará Tolies, for the appellants.

      W. G. Peelcham, for the respondent.
   Parker, J.:

In Bohm v. Met. Elevated R. R. Company (129 N. Y. 576) the court, having under consideration a judgment awarding damages to an abutting owner, because of the defendants’ interference with his beneficial enjoyment of certain easements belonging thereto, held that the damages and the compensation to be paid in such case are measured by the balance of injury over benefits, and in ascertaining them the advantages and disadvantages áre to be considered, and the benefits, whether general or special, from the construction and operation of the railroad, which tend to counterbalance the disadvantages, are to be taken into account in reaching the final result.

And it has been held in subsequent cases that a refusal by a referee' or trial court to find, upon being requested to do so, that the law is on that subject as stated in BolvrGs case, constitutes ground for reversal of the judgment if properly excepted to, the reason assigned being that, as the request to find states correct principles of law, a refusal to find it requires the inference that these principles are not fully applied, and thereby, necessarily, the defendant is-deprived of the full benefit of them. (Sperb v. Met. El. Railway Co., 137 N. Y. 596; Livingston v. Met. El. Ry. Co., 138 id. 76; Odell v. New York El. Ry. Co., 130 id. 690; Gray v. Manhattan El. Ry. Co., 35 N. Y. St. Repr. 32.)

The defendant requested the trial court to rule as a matter of law that “plaintiff is not entitled to recover damages in this action except to the extent, if any, by which the disadvantages of the defendant’s railroad have exceeded the advantages thereof to said premises.” The court refused, and to the ruling an exception was duly taken. The cases to which we have referred determine that this ruling was erroneous, and command a reversal of the judgment unless it appears elsewhere in the record that the rule embraced in the proposition was recognized and given force and effect by the trial court.

In Bischoff v. N. Y. Elevated R. R. Co. (138 N. Y. 257), the court refused to reverse a judgment where the trial court had declined to rule substantially as requested here, but on the ground that there was no evidence of general as distinguished from special benefits, resulting to the property by the construction and operation of the railroad.

If that were the case here, or if the findings disclosed that the trial court actually applied that which the courts have determined to be the true rule in measuring the damages which should be awarded, Bisehoff^s case would point the way to an affirmance of the judgment, for under such circumstances the exception would point out a technical but unsubstantial error. But it cannot be said here that there was no evidence before the court tending to show what is called general benefits resulting to this and other property in the same vicinity, by the building and operation of defendant’s elevated railroad.

Evidence tending in that direction can be found scattered all through the record; therefore, the ruling cannot be disregarded on the ground that there was no evidence making it necessary for the trial court to apply the rule involved by the request.

Nor does it appear from the other findings made by the trial court that this rule was in fact applied. Until the decision in Bohm’s case the courts had not gone so far in the direction of offsetting advantages against disadvantages, the furthest step in that direction, prior thereto, having been taken in Newman v. Elevated R. R. Co. (118 N. Y. 618), in which case it was held that in measuring the damages there must be taken into consideration the benefits, if any, peculiar to the owner’s property which have arisen by the construction of the road.

The case under review was tried after the decision in Newmcm's case, but before that of BolmvUs, and the court, following the practice as it was then understood and ajoplied by the courts, ruled as a matter of law that ‘‘ in estimating the damages, if any, to which plaintiff is entitled in this action, and in estimating the amount of compensation to which plaintiff is entitled for the talcing of his easements, the benefits caused by defendant’s railroad to plaintiff’s said property, and not shared by the community in general, should be taken into consideration,” and refused to rule in the manner requested by the defendants as hereinbefore quoted. It is apparent, therefore, that the inference is not permissible here as in Bischoff’s case, that the court did not exclude from consideration the evidence presented by the defendants touching general, as distinguished from special benefits to the plaintiff’s property, resulting from the construction of defendants’ elevated railroad.

If the views expressed are correct it follows that the judgment should be reversed, with costs to appellants to abide the event.

Follett, J., concurred.

Tan Brunt, P. J.

(dissenting) :

I think the judgment should be affirmed. It seems to me to be impossible to determine from the decisions of the Court of Appeals what the rule is in respect to refusals to find, and the court did not err in its refusal to find a rule of law.

Judgment reversed and new'trial ordered, with costs to appellants to abide event.


author: Yan Brunt, P. J. :

text:
    Julius Imgard and Another, Respondents, v. Walter B. Duffy, Appellant.

      Venue — affidavit required on a motion to change it.

    Appeal by the defendant, Walter B. Duffy, 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 12th day of May, 1893, denying defendant’s motion for a change of venue.

      M. H. Briggs, for the appellant.

      Welch <& Daniels, for the respondents.
   Yan Brunt, P. J. :

The opinion of the court in the case of Thurfjell v. Witherbee (70 Hun, 401) seems to be entirely applicable to the case at bar. The defendant swears to his expectations, and-that is all. Within the principles laid down in the case cited, this is not sufficient to justify the court in granting the motion to change the venue. The party should state at least upon what his expectations are founded, so that the court may say that there is some ground for the hopes expressed.

The order should, therefore, be affirmed, with ten dollars costs and disbursements, with leave to the defendant, upon payment of the costs of this appeal and the costs of the motion in the court below, to renew the application to change the venue upon new papers.

O’Brien, J., concurred.

Order affirmed, with ten dollars costs and disbursements, with leave to the defendant, upon payment of the costs of this appeal and the costs of the motion in the court below, to renew the application to change the venue upon new papers.


author: Martin, J.:

text:
    In the Matter of the Application of the City of Utica for the Appointment of Commissioners in Proceedings to Take Lands of the People of the State of New York for Street Purposes. The People of the State of New York, Appellant; The City of Utica, Respondent.

      Eminent domain — exemption of State lands from condemnation by municipalities-for street purposes —prior dedication to a public use — an order appointing commissioners is appealable.

    Tlie State or People are not bound by a statute, unless expressly named, or included in its terms by necessary implication.
    Where the Legislature has conferred upon a corporation or municipality' the general power to acquire lands hy the right of eminent domain, such power does not extend to lands already dedicated by authority of law to a public use, unless such right is expressly conferred hy the statute in direct terms or by necessary implication.
    The city of Utica cannot, under the general authority conferred upon it by its charter (Laws of 1862, chapter 18, as amended) to acquire land for street purposes by proceedings in invitum, condemn land owned by the State of New York, previously dedicated by authority of law to a public use, as, for example, a part of the grounds of the Utica State Hospital, the taking of which for street purposes would be inconsistent with its use for the purposes of the hospital and would absolutely deprive the State of all benefit in and use of the property taken and essentially interfere with the use of the remainder of the land used for those purposes.
    An order made in such a proceeding appointing commissioners to appraise the lands so sought to be taken Is appealable.
    Appeal by tbe People of the State of New York from an order of the County Court of Oneida county, entered in the office of the clerk of that county on the 21st day of May, 1892, appointing commissioners in the above-entitled proceedings.
    /S'. W. Rosándole, Attorney-General, and John D. MeMahon, Deputy Attorney-General, for the appellant.

      Josiah Perry, William Kernan and E. D. Mathews, for the respondent.
   Martin, J.:

The order from which this appeal was taken was made in a proceeding instituted under the charter of the city of Utica to open a street through the farm or grounds of the Utica State Hospital without the consent of the State or the managers of that institution. The Utica State Hospital and the State Lunatic Asylum at Utica are one and the same institution, the former name having been substituted for the latter. That this institution is a public one, and has been maintained as such by the State for more than a half century, is not only a matter of common knowledge, but may be seen by an examination of the public statutes of the State passed during that time. It is also an established fact that the jnoperty through which the city of Utica now seeks to open the street in question has been dedicated to the use of such institution, and has been used for that purpose for many years. That the use to which it has been thus dedicated is a public one cannot be. denied. That the property is not only proper but necessary for such public use is equally certain. The question in this case is whether, under such circumstances, the authorities of the city can condemn the State property thus used, or any portion of or interest in it, for the purpose of laying out a public street through it.

If any such authority exists it is given by the provisions of the charter of the city of Utica (Chap. 18, Laws 1862), and subsequent acts amendatory thereof. The charter gives the common council of the city power to lay out, open, make, amend, repair, alter, extend, widen, control and discontinue streets, lanes and highways. In case it shall be necessary to appropriate for any street any real estate not belonging to the city, which the city may not be permitted by the owner freely to appropriate, it prescribes the procedure to be adopted to acquire the right to open or lay out such streets.

It is contended by the appellant that the common council of the ' city of Utica possessed no right or power to condemn the property of the State, especially such as was already dedicated to a public use, and, therefore, that the proceeding which resulted in the order appealed from was unauthorized and the order void. Thus, the cpiestion we are called upon to determine relates not to procedure, but to the right of condemnation alone. It is a question not of discretion but of power.

At the commencement of this investigation we are met with the question whether the statute under which this proceeding was instituted has any application to, or authorizes the condemnation of, the lands of the State. It seems to have been a well-established principle of the common law that the Crown was not bound by a statute, unless named in it, for the reason that the law is presumed to be made for subjects only, and that at all events the Crown was not reached except by express words, or by necessary implication, in any case where it would be ousted of an existing prerogative or interest. (Attorney-General v. Donaldson, 10 M. & W. 117, 124; Huggins v. Bambridge, Willes, 241, 246; The King v. Wright, 1 Ad. & E. 434, 437; Ex parte Russell, 19 Ves. Jr. 163, 165 ; Ex parte Postmaster-General, L. R. [10 Ch. Div.] 595, 598 ; In re Henley & Co., L. R. [9 Ch. Div.] 469, 481; Weymouth v. Nugent, 6 B. & S. 22, 33; In re Cuckfield, 19 Beav. 153.) The United States courts also hold that the sovereign power is not bound by general words in a statute, but only when included expressly or by necessary implication. (United States v. Hewes, Crabbe, 307; United States v. Hoar, 2 Mason [U. S.], 311; United States v. Greene, 4 id. 427, 431; United States v. Herron, 20 Wall. [87 U. S.] 251.) The same rule has been recognized in many of the States as applicable to the Commonwealth, its rights and interests. (Jones v. Tatham, 20 Penn. St. 398, 411; Stoughton v. Baker, 4 Mass. 521, 528; State v. Milburn, 9 Gill [Md.], 105, 117; Cole v. White County, 32 Ark. 45, 51; State v. Kinne, 41 N. H. 238, 240; State v. Garland, 7 Ired. [N. C.] 48, 50.)

When we examine the decisions of our own State upon the subject, we find that the question arose in the case of People v. Gilbert (18 Johns. 226), and that it was held that the English common-law rule that the King is not bound by a statute of limitations, was by the adoption of the Constitution made the law of this State, and that the State was not included in the general expressions of a statute. In People v. Rossiter (4 Cow. 143) the English rule was again followed, and it was held that the State was not bound by an insolvent or bankrupt law, unless named in it. The court, in delivering the opinion, said: “ The People are not bound by an act of this kind, unless they are named in it. The rule is the same as in England. The King is not bound by a bankrupt law unless named ; and the People are the King for the purposes of this rule.” In People v. Herkimer (4 Cow. 348) it was held that the People have succeeded to the rights of the King, and are not,, therefore, bound by general words in a statute when any right or interest might be divested by or taken under it.

It is said to be upon this principle that the grant to a corporation by the Legislature of a general power to take real estate for the purposes of the incorporation does not extend to property already dedicated by authority of law to, and held for, another public use (Enlich on Interp. Stat. § 162), but be that as it may, the rule seems to be firmly established that to take property already appropriated to another public use, the act of the Legislature must show the intent to do so by clear and express terms or by necessary implication, leaving .no doubt or uncertainty respecting the intent. (Mills on Em. Dom. § 46, and cases cited in note 1.)

In Matter of Boston & Albany R. R. Co. (53 N. Y. 574, 577), where a railroad company sought to condemn land that had been dedicated to the use of a public park, it was said : “ The sole question, then, is whether the Legislature has conferred upon the applicant the power to enter upon and take possession of property already held and dedicated by authority of law to one public use, for another and entirely different use also declared to be public.” After stating that the authority for the proceeding in that case, if it existed, must be found in the G-enoral Bailroad Law, the court added : “ It (the power) must be expressly conferred, that is, in direct terms or by necessary implication, and the implication does not arise if the powers expressly conferred can, by reasonable intendment, be exercised without the appropriation of property - already actually held and used for another public use.” In Matter of City of Buffalo (68 N. Y. 167) it was again held that while the Legislature might interfere with property held by a corporation for one public use and apply it to another, and might delegate the power to do so to another corporation, yet that such delegation must be in express terms or arise from necessary implication. In Matter of N. Y. C. & H R. R. R. Co. (77 N. Y. 256) it is said : “ The doctrine that corporations who derive power from the Legislature to take property by the right of eminent domain, cannot exercise such power in reference to property already dedicated to public use, without express grant, cannot be controverted.” (See, also, Matter of Boston, Hoosac Tun. & W. R'way Co., 79 N. Y. 68 ; Suburban R. T. Co. v. Mayor, etc., of N. Y., 128 id. 510, 521.)

By these authorities two rules are established r (1) That the State or Peojfie are not bound by a statute, unless expressly named or included in it by necessary implication; (2) that where the Legislature has conferred upon a corporation or municipality the general power to acquire lands by the right of eminent domain, it does not apply to lands already dedicated by authority of law to a public use, unless such right is expressly conferred by the statute in direct terms or by necessary implication. Applying those rules to the facts in this case, we are unable to perceive any ground upon which the proceeding which resulted in the order appealed from can be upheld, as there is nothing in the statute under which it was instituted which either expressly or by necessary implication conferred upon the city the power to appropriate the lands of the State for street purposes. As we have already seen, the use to which the grounds around the Utica State Hospital have been dedicated for more than fifty yeai-s was a public one, the property thus used was required for the purpose to which it had been dedicated, the use for which it was sought to be condemned was inconsistent with its use for the purposes of the hospital, would absolutely deprive the State of all benefit in and use of the property taken, and essentially interfere with the use of the remainder. Under these circumstances, we are clearly of the opinion that the city of Utica acquired no right or authority under its charter to condemn the lands in question.

It is, however, contended by the respondent that the order of the county judge, appointing commissioners, was not appealable. The Matter of City of Buffalo (64 N. Y. 547) seems to be adverse to this contention. There the appeal was from an order of the General Term of the Superior Court of the city of Buffalo affirming an order of the Special Term appointing commissioners to appraise the lands of the appellants, and the order was held to be appealable. In that case it was said : “ If the case presented was not within the law, commissioners could not legally be appointed. Assuming that the court could not review the judgment of the common council as to the necessity for taking the lauds, or their discretion in determining upon the plan or extent of the improvement, it had power to inquire and decide whether it could act at all upon the application.” We think the doctrine of the case cited is decisive of the question, and that the order was appealable.

Our conclusion is that the order appealed from should be reversed, and the respondent’s motion for the appointment of commissioners should have been denied.

Hardin, P. J., and Merwin, J., concurred.

Order reversed, with ten dollars costs and disbursements.


text:
    Hattie D. Huntley, Respondent, v. Elmer E. Huntley, Appellant.

      Action for divorce — hoto the trial before a referee can be reviewed — evidence of the defendant improperly excluded— Code of Civil Procedure, § 831.
    In an action brought to obtain an absolute divorce the Special Term has no power, after a trial before a referee, to examine the case upon the merits, or to reverse the report of the referee for errors or irregularities committed on the trial, and the only manner in which the trial before the referee can be reviewed is by an appeal to the General Term.
    In an action brought to obtain an absolute divorce on the ground of adultery, the defense was that the alleged adultery was committed with the consent, connivance, privity and procurement of the plaintiff. On the trial the defendant gave testimony which, if true, showed that he was not guilty of the adultery charged, and that the acts proved by the plaintiff, and relied on by her as evidence of the defendant’s adultery, were performed by the defendant with the privity and procurement of the plaintiff, and that she colluded and connived with the defendant and induced him to perform them so that she might secure a divorce.
    Upon the motion of the plaintiff all the evidence given by the defendant as to conversations with the plaintiff tending to show connivance was struck out as privileged.

      jHeld, that the evidence was competent and should not have been stricken out as it not only tended to show connivance on the part of the plaintiff, but also tended to disprove the plaintiff’s allegations of adultery.
    Section 831 of the Code of Civil Procedure, allowing a defendant to disprove the allegations of adultery made by his wife, does not limit the evidence to a simple denial; the husband or wife can testify to any fact or circumstance within his or her knowledge, competent and material on the question as to whether the act, as charged, was committed.
    Appeal by the defendant, Elmer E. Huntley, from a judgment of the Supreme Court, entered in the office of the clerk of the county of Broome on the 24th day of January, 1893, upon the report of a referee granting the plaintiff a judgment of absolute divorce, and from an order entered in the said clerk’s office on the 24h day of January, 1893, denying the defendant’s motion for a new trial.

      F. Newell Gilbert, for the appellant.

      Winthrojy P- Pavnter, for the respondent.
   Martin, J.:

This action was for an absolute divorce on the ground of adultery. The defense was in effect that the alleged adulteiy of the defendant was committed with the consent, connivance, privity and procurement of the plaintiff, a denial of the plaintiff’s allegations of adultery, and a counterclaim setting up adultery upon the part of the plaintiff.

The issues in the action were referred to a referee to hear and ■determine. He found that the defendant was guilty of adultery ; that it was committed without the consent, connivance, privity or procurement of the plaintiff, and that the plaintiff was not guilty of the acts of adultery charged by the defendant.

The Special Term had no power to examine the case upon the merits, or to reverse the report for errors or irregularities committed on the trial, and hence the only manner in which the defendant could review the trial before the referee was by appeal to this court. (Schroeter v. Schroeter, 23 Hun, 230 ; Ross v. Ross, 31 id. 140, 146; Matthews v. Matthews, 53 id. 244; Ryerson v. Ryerson, 27 N. Y. St. Repr. 945.)

On the trial, the defendant was called as a witness in his own behalf, and gave testimony which, if true, showed conclusively that he was not guilty of the adultery charged, and that the acts that were proved by the plaintiff, which were relied upon as evidence of the defendant’s adultery, were performed by the defendant with the privity and procurement of the plaintiff, and that she colluded and connived with the defendant to perform them so that she might secure a divorce. After this evidence was admitted, the plaintiff moved to strike out all the evidence given by the defendant as to conversations with the plaintiff tending to show connivance, as privileged, and the motion was granted. To this the defendant duly excepted.

Without examining the question whether the plaintiff’s objections to the evidence were such as to justify the court in striking out the evidence after it had been received, if it was improper, we are of the opinion that the evidence stricken out was proper, as it not only tended to show connivance on the part of the plaintiff, but also tended to disprove the plaintiff’s allegations of adultery, and that the learned referee erred in striking it out.

By section 831 of the Code of Civil Procedure, the defendant " was a competent witness to disprove the allegations of adultery made by the plaintiff. This section does not limit the evidence to a simple denial, but gives the right generally to disprove the allegation of adultery by showing that the allegation is not true. The defendant can, not only deny the allegation, but can testify to any fact or circumstance within his knowledge, competent and material on the question as to whether the act, as charged, was committed. (Stevens v. Stevens, 54 Hun, 490.)

Applying the principle of the case cited to the question before us, it becomes quite manifest that much of the evidence stricken out was admissible as tending to show that the defendant was not guilty of the act of adultery charged, and of which the defendant has been found guilty. His evidence, which was quite- strongly corroborated by the evidence of other witnesses, was to the effect that the plaintiff desired a divorce from the defendant so that she could marry another man who could maintain her in idleness and dress her more extravagantly; that she requested her husband to go into a room with some other woman in the presence of witnesses, so that she might prove that fact by them and thus obtain a divorce ; that she finally induced him to consent to such plan upon her agreeing to pay the expenses of obtaining a divorce ; that he went with her to see her lawyer; that he procured two witnesses, one a Mr. Miller, a cousin of the plaintiff, to go with him to a house of ill-fame; that he went into a room with one of the inmates, but had no criminal intercourse with her; that he then left the house; that the witness Miller who was with him immediately reported the fact to his wife; that the next day she went to the house and got his meals, and the following day they amicably divided their household goods; and many other facts and circumstances tending to show that what was done by the defendant was done at the request of the plaintiff and by her procurement for the purpose of getting evidence upon which she could base an action for divorce.

If this evidence was true, we have not only the evidence of the defendant denying that he committed adultery on that occasion, but the other facts and circumstances testified to by him which tend to show the purpose of his action, to corroborate his statement that he was not guilty of the offense charged, and to explain the circumstances which, unexplained, might tend quite strongly to show that he was guilty of the offense. We think the learned referee erred in striking out this evidence, and that for such error the judgment should be reversed, as it cannot be said his ruling was harmless to the defendant. (Matter of Eysaman, 113 N. Y. 70, 71.)

We are also of the opinion that the judgment in this case should be reversed on the facts. While we are not unmindful of the superior advantages possessed by the referee, who saw the witnesses, heard their testimony and had an opportunity to observe their demeanor while testifying, and while we recognize the ability of the learned referee before whom this action was tried, still, a careful examination of the evidence has led us to the conclusion that the findings of the referee are not sustained by that fair preponderance of evidence which would justify us in upholding the judgment.

The judgment and order confirming the report of the referee must be reversed on the law and facts and a new trial ordered, ivith costs to abide the event.

Hardin, P. J., and Merwin, J., concurred.

Judgment and order confirming the report of the referee reversed on the law and the facts and a new trial ordered, with costs to abide the event.