author: Ingraham, J. Freedman, J. (concurring). Sedgwick, Ch. J. (concurring).

text:
    JAMES H. GOODSELL, Respondent, v. THE WESTERN UNION TELEGRAPH CO., Appellant.

      lies adjudicata—Two causes of action in complaint, judgment in one will be res adjudicata on subsequent trial of other on questions adjudicated by judgment, which also are involved on such subsequent trial—Election of rights under contract—What constitutes election—Contract, total breach of, luhat does not constitute. Impairment of election, what does not effect it.

      lies adjudicata. A judgment in favor of plaintiff in an action brought to recover an amount claimed to be due him, up to and on a certain date, from the defendant, under and by the terms of a contract, for the amount found due from defendant under the contract up to that date, is an adjudication of the execution, existence and validity of the contract, the right of the plaintiff to recover thereon in his individual name, the obligation of defendant to perform it, and of the continuance in force of the contract to that date.
    Those questions are by force of such judgment, res adjudicata, upon a subsequent trial, between the same parties, of an action to recover damages for a breach of the contract.
    As a result from this, no breach of the contract can be assigned in the action for damages, anterior to the date up to which a recovery was had in the action brought to recover the amount claimed to be due under the contract by its terms.
    As a further result, it appearing in such action for damages, that on such date above referred to, the plaintiff voluntarily ceased business and to act under the contract, no breach by the defendant was established.
    The above principles are applicable to a new trial ordered by the General Term, under the following circumstances :■—The plaintiff brought an action for both causes of action, and in the first instance recovered judgment on both causes, which on appeal was reversed and a new trial ordered as to the cause of action for damages for a breach but affirmed as to the other cause; and thereafter a new trial was had as to the cause of action as to which the reversal was had. The judgment in plaintiff’s favor on the other cause of action (remaining in full force) is on such new trial, res adjudicata, on all questions adjudicated by the judgment so affirmed.

      Election of rights. Where one party to a contract notifies the other that for rendering the services called for by the contract, he will charge higher prices than those stipulated for by the contract, and in the event of a refusal to pay or secure to be paid such higher prices, the services would be discontinued, the other party has his election, either to accept such notification as a refusal to perform the contract and a breach of it, and sue for a breach, or to treat the contract as still in force, proceed under it and hold the party giving the notice to a compliance with its terms. Per Ingraham, J..

      What constitutes election. If the party to whom the notice was given thereafter continues to furnish the matter in respect whereof the services were to be performed by the parly giving the notice, and the latter continues to render the services until finally the former ceases to furnish matter, having two days prior thereto by letter notified the latter that he did not waive any right or claim under the contract, but insisted on it, and always had been and still was carrying out the same, and that he was ready and willing and thereby offered so to do, and asked that the same be carried out by the latter—he elects not to treat the notice as a refusal to perform and a breach of the contract, but to treat it as still - in force, and cannot thereafter sustain an action for damages' for breach of contract based on such notification, given by the latter. Per Ingraham, J.

      Contract, total breach of. The retention by the party giving the notice of an increase of prices, of moneys thereafter collected by him under the contract for account of and to be by him paid over to the other, whereby the latter is forced to cease the business in reference to which the contract was made, for the want of money to pursue it, will not constitute a total breach of'contract by the former, giving the latter an action for damages therefor.

      Retention, impairment of election. Such retention does not impair the effect of the latter’s acts in continuing to furnish matter under the contract, intermediate the giving of the notice of an increase and his cessation of business, and in notifying the former that he waived no rights under the contract and insisting that the former should carry out the contract, as constituting an election. Per Ingraham, J.
    Before Sedgwick, Ch. J., Freedman and Ingraham, JJ.

      Decided December 19, 1887.
    Appeal by defendant from judgment and from order denying a motion for a new trial.
    Sufficient particulars of the contract referred to in the opinion, will be found in the report of the decision on a former appeal in this case (53 Super. Ct. 46). The other facts sufficiently appear in the opinion.

      Dillon & Swayne, attorneys, Wager Swayne and Edioard Patterson, of counsel, for appellant.

      Miller & Savage, attorneys, and George W. Miller, of counsel, for respondent.
   Ingraham, J.

This action was originally brought by the plaintiff to recover for two causes of action; the first cause of action being for the amount due under a contract between the plaintiff and the Atlantic and Pacific Telegraph Company, and which the defendant undertook and assumed to perform ; and the second cause of action being for the damages sustained by plaintiff for a breach of the contract by the defendant, in having refused and neglected to carry out the contract on the 11th day of March, 1882; and judgment was demanded against the defendant for the sum of $32,000, with interest from April, 1882, under the contract, and the sum of $650,000 damages for the breach of said contract.

The action was first tried before a referee who found that the contract was a valid and subsisting contract between the plaintiff and the defendant; that from the 3d day of February, 1881, to and including the 22d day of June, 1882, the plaintiff fully performed and fulfilled on his part, all the terms and conditions of said contract, but that the defendant did not perform and fulfill all the terms and conditions of said contract on its part to be performed and fulfilled, specifying particularly the instances in which the defendant had failed to fulfill its obligation.

The referee also found as follows: “ Eleventh: That defendant collected for and on account of the plaintiff, from the several newspapers and newspaper proprietors who received and were served with said telegraphic news reports, the sums and prices that had been agreed to be paid by said newspaper reporters and proprietors to plaintiff for said news reports from the 3d day of February, 1881, to the 22d day of June, 1882 ; that the collections so made by the defendant for said plaintiff under the said contract, amount to the aggregate sum of $157,800.”

Twelfth: That the telegraph service rendered by the defendant to the plaintiff from the 3d day of February, 1881, to the 22d day of June, 1882, under the terms and conditions of said contract, amounts to the sum of $78,500, for what is named as the regular service in the third clause of said contract, and the sum of $16,772.58 for additional or extra service in excess of 6,750 words per day, as provided in the fourth clause in said contract. The whole of said service under said contract during said time, amounted to the aggregate sum of $95,272.58, which the defendant was authorized under said contract to retain, and from said collections to account to and pay the balance to the plaintiff, and the amount that the defendant should have accounted for and paid to the plaintiff during said time, was the sum of $62,527.42, of which and on account of which, the defendant paid the aggregate sum of $45,750, leaving a balance clue and owing to the plaintiff from the defendant of the sum of $16,777.42.”

The referee further found that, by reason of the failure, neglect and refusal of the defendant to fulfill and perform the terms and conditions of the contract on its part, and because of the breach or breaches of the contract by the defendant thereinbefore stated, the plaintiff suffered great loss and damage by reason of the failure, neglect and refusal of the defendant to fulfill and perform the terms and conditions of the contract on its part to be fulfilled and performed, to the amount of $220,306.

And as a conclusion of law, the referee found that the contract was and is a valid and legal contract by and between .the said plaintiff and the Atlantic and Pacific Telegraph Company, and that plaintiff was entitled to judgment against the defendant for the sum of $16,777.42, with interest thereon from the first day of July, 1882, on account of the balance due him from the collections made by defendant for plaintiff, over and above the amount which the defendant by said contract Avas entitled to retain out of said collections, as compensation for the said telegraph sendee under said contract; and also for the sum of $220,306, as damages for the several breaches of the said contract set forth in the complaint, with costs. .

From the judgment entered on this report of the referee, the defendant appealed, and on that appeal it Avas ordered by the General Term that the judgment as to the first cause of action set forth in the complaint for $16,777.42, be affirmed, and that the judgment as to the second cause of action for $220,306, be reversed, and a new trial ordered on that cause of action; thus in effect seA7ering the action.

The new trial ordered for the second cause of action Avas had before a jury, and on that trial a A'erdict Avas rendered in fai7or of the plaintiff for the sum of $250,000, on which verdict judgment was entered, and from that judgment the defendant appeals.

The judgment of the General Term on the former appeal, affirming the judgment entered on the first cause of action, is an adjudication of the execution, existence and validity of' the contract sued upon, the right of the plaintiff to recover in his individual name, and that the defendant was bound to perform the said contract; and, AvhateA7er my individual opinion may be on those questions, I think they are res adjudicada on the trial of the second cause of action.

The first cause of action having been upon the contract to recover the amount unpaid by the defendant to the plaintiff, under its terms, is not an adjudication that there was a breach of the contract by the defendant, and the first question presented is whether or not on the testimony there was evidence to sustain the finding of the jury that there had been a breach by the defendant of the whole contract, which would relieve the plaintiff from the duty of proving a compliance with the contract on his part, and support a verdict in his favor for the damages occasioned by such breach.

At the end of all the testimony in the case, the defendant moved for a nonsuit upon several grounds, one of which was that the plaintiff had not proved any breach of the contract, as alleged in the complaint, from which the plaintiff was shpwn by the evidence to have suffered any damages whatever, and that the words, or conduct, relied upon as a breach of the contract by anticipation, do not, by themselves, amount to a breach of the contract. The court denied that motion on the ground that it would not be justified, on the evidence in the case, in holding, as a matter of law, that there had been no breach, to which denial defendant’s counsel excepted.

The evidence relied upon by the plaintiff to prove a breach of the contract consists of three letters; the first dated March 11,1882 ; the second March 24,1882 ; and the third May 10, 1882. The first of these letters' is signed by Norvin Green, president of the defendant, and, after stating the execution of the contract, and the action of the parties under it, says: I am therefore directed by the sub-committee to whom this subject was referred, to say to you that, from and after this date, you will be charged for the transmission of your press reports at the same rate as that charged for other combination press reports in the respective territories in which said reports are handled under existing agreements, and that, unless such rate is paid or secured to be paid to this company, the service will be discontinued.” No reply was made to this letter, but plaintiff continued to furnish press reports to the defendant for transmission, which reports were duly transmitted, as required by the said contract, by the defendant. Subsequently, and on March 24, 1882, the president of the defendant sent another letter to the plaintiff which stated that he was authorized by the proper committee of the board of directors of the defendant company to say that they would send the plaintiff’s news reports of a minimum of five thousand words daily, from New York to various places, at a price in excess of that provided by the contract. No mention is made in this letter of the existing contract between the parties, nor is there any statement in that letter that the defendant would refuse or did refuse to carry out the contract then in existence. To that letter, plaintiff made no reply, but continued after that time to furnish reports for transmission by the defendant, and which reports were duly transmitted.

Very soon after the receipt of this letter, the plaintiff had a conversation with Mr. Van Horn, the vice-president of the defendant, at which he informed Van Horn that the rates that the defendant had imposed upon him, as a condition of the continuance of his business, were prohibitory; that he could not pay them and would not pay them, and that he would sooner abandon the business than undertake to pay them, and that he would be compelled to discontinue business and he would hold the company responsible for six hundred thousand dollars damages, and to that statement no reply was made.

Subsequently, a letter was received from Mr. Eckert, general manager of the defendant, which inclosed a schedule of places to which the defendant stated it Avould transmit and deliver plaintiff’s reports, in future, upon the terms and conditions named in the letter of March 24, and which also contained a schedule of tolls to be charged on incoming matter to New York city since March 11, as provided in the letter of March 24, above referred to ; and to that letter the plaintiff made no reply, but continued, as before, to furnish reports to be transmitted by the Western Union Company, Avhich reports Avere duly received and transmitted by that company, and collections thereafter made by defendant, as provided in the contract.

The plaintiff, however, testified that he had, about the time of the receipt of either the first or second letter, viz., March 11, or March 24, a conversation with Doctor Green, the president of the defendant, at which he informed him that the rates proposed to be charged were absolutely prohibitory, under the present revenue he was receiving; that if he was required to pay the prices that he had been paying for the transmission, then obviously, he was required to charge his customers a considerable increase of money • that with a view of experimenting, seeing what could be done in that direction, he would send out a circular to the various papers that he was then serving, to test their willingness to pay an increased price; that he very much doubted whether a sufficient increase could be imposed to justify anything like the rates that defendant proposed to charge as a condition of continuing the business; and that in reply to that proposition, Doctor Green stated that he thought it was well to do that; he thought he (the plaintiff) ought to collect more, and that he thought that his customers ought to stand by him and pay a much larger sum; and he thought that they would do it.

In pursuance of that conversation, the plaintiff sent out a circular, but he did not receive any additional pay or promise to pay sufficient to meet the demand of Doctor Green, and he subsequently saw Doctor Green and told him that it was impossible to collect enough additional money to justify these new rates, and in answer to that the plaintiff does not recollect that Doctor Green made any reply.

The plaintiff however .continued to deliver dispatches to the defendant, which were transmitted by the defendant, and on the 20th of June, 1882, the plaintiff served upon the defendant a notice as follows : Having on the first day of January, 1881, made a contract with the Atlantic and Pacific Telegraph Company for the service of my National press dispatches or news, which service under said contract was for a time carried on and performed by the Western Union Telegraph Company, but Avhieh the Western Union Telegraph Company sometime since declined further to carry out, and for the performance of Avhieh service the Western Union Telegraph Company has imposed different and more onerous terms, I hereby notify both said companies that I have not Avaived, and do not waive, any right or claim under said contract, but insist upon the same, and declare that I have been always and still am carrying out the same on my part, and am ready and able and willing, and hereby offer so to do, and ask that the same may be duly carried out by the Atlantic and Pacific Company or the Western Union Company.” No ansAver to that notice Avas received from either company.

The plaintiff continued to deliver to the Western Union Company dispatches, until the 22d of June, 1882, which dispatches were received and transmitted by the company, and on the 22d of June the plaintiff ceased business under the contract, and he gives in his testimony his reasons for discontinuing business, which are as folloAvs : “The Western Union Telegraph Company refused to pay me money. I had no money to carry on business, and I was croAvded by the directors of the United States Cable Company for the debts due the Cable Company for the preceding sixty days ; and having been unable to collect any money from the business to pay the expenses of the business, I was obliged to stop.” He was then asked the question, “If you had received the money which you specifically asked for, were you ready and willing and able to carry out the contract ? ” to which he answered, “I Avas.”

To sustain the plaintiff’s recovery in this action for a total breach of the contract, it was necessary for him to prove that the defendant had positively and absolutely refused to carry out a substantial part of its agreement.

As was said in Bogardus v. Life Ins. Co., 101 N. Y. 335 : “ The failure of one party to a contract to perform some of its obligations, when it consists of a number of independent provisions, furnishes no excuse for nonperformance to the other party. It is only when the non-performance is of a condition precedent, or where such party has wholly refused to perform, or has wholly disabled himself from completing a substantial performance, that the other party is relieved from performance or a.tender thereof.” It is also settled that a a mere assertion that the party will not be able, or will refuse to perform his contract, is not sufficient. It must be a distinct and unequivocal and absolute refusal to perform the promise, and must be treated and acted upon as such by the party to whom the promise was given; for if he afterwards continues to urge or demand compliance with the contract, it is plain that he does not consider it at an end.” Benjamin on Sales, 4 Am. ed. (Bennett) § 568, cited with approval as a correct statement of the law by the Supreme Court of the United States in Smoot’s case, 15 Wallace, 48.

This action having been, based upon the breach of the contract, the burden was upon the plaintiff to prove such breach and the damages sustained by reason thereof.

The statement of inability or refusal to perform was not alleged in this action as a mere waiver of the performance of a condition precedent upon the part of the plaintiff, so as to dispense with such a performance, or a tender of performance, as in most of the cases cited; for example, the case of Lawrence v. Miller, 86 N. Y. 138; but to sustain this action, there must be alleged and proved such an act of the defendant as amounted to an entire abrogation of the contract, so that by the act of the defendant the contract is at an end, and this must be treated and acted upon as such by the party to whom the promise was made.

In Wakeman v. Wheeler & Wilson M’f’g Co., 101 N. Y. 210, the court held that in an action for a breach of a contract the recovery is based upon the repudiation of the contract. Plaintiff is deprived of his contract and is entitled to recover, in lieu thereof, its value. That is the foundation of the plaintiff’s claim in this case, and, to entitle him to recover such value, he must prove that his contract was destroyed; that by some act of the defendant he was deprived thereof. In Fish v. Folley, 6 Hill, 54, it was held that, on a total breach of the contract, the contract was put an end to, and that gave plaintiff a right to sue for an equivalent in damages.

To sustain this burden, plaintiff has proved the three letters from the defendant. Assuming that the letter of March 11, 1882, was a notice that the defendant would not perform the services referred to in the contract, for the compensation therein provided, the plaintiff then had his election either to accept that letter as a refusal to perform, treat the contract as at an end and bring Ms action for a breach thereof ; or he could proceed under the contract and hold the defendant to a compliance with its terms. He could either treat the contract as broken and at an. end, or treat it in full force and effect. As an illustration of the cases in which such an election exists, see Noyes v. Phillips, 60 N. Y. 411; Higgins v. Del., Lack. & W. R. R. Co., Ib. 557, and the remarks of Nelson, Ch. J., in Masterton v. The Mayor, &c., 7 Hill, 71.

It is evident that these positions are inconsistent. In one case the contract was abrogated by the breach, and in the other case the defendant would be liable for the amount received and collected by it from the person^ to whom the dispatches were sent, less the compensation allowed by the contract to be retained by the defendant for the services performed.

Standing in this position, the plaintiff continued to deliver dispatches to the defendant, which were received and transmitted, and served a notice on the defendant that his contract-was still in force, and that he was carrying it out, which notice was received by the defendant without objection, and after the receipt of such notice his dispatches were received by the defendant and transmitted; and plaintiff then brought an action for the amount due under the contract to the 22d of June, 1882, and recovered judgment therefor. I think it is clear that this was an election to proceed under the contract, and hold the defendant to a compliance with its terms, and not to treat the contract as broken and at an end.

In Rodermund v. Clark, 46 N. Y. 357, it is held that, “ where there exists an election between inconsistent remedies, the party is confined to- the remedy which he first prefers and adopts. Any decisive act of the party, with knowledge of his rights and of the facts, determines his election in the case of conflicting and inconsistent remedies.” And in Sanger v. Wood, 3 John. Ch. 421, the Chancellor says: In the case where the remedies sought are absolutely repugnant to each other, the plaintiffs ought to have .made their election at once after they came to a knowledge of the facts...... Any decisive act of the party, with full knowledge of his rights and of the facts, determines his election, in the case of conflicting and inconsistent remedies. . . . . . I consider the going to trial in the action at law, and especially the entry of judgment afterwards upon the verdict, as a decided confirmation of the settlement.” See also Morris v. Rexford, 18 N. Y. 557.

Applying this rule, it is evident that the act of the plaintiff in insisting upon the performance of the contract, after the letters of March 11 and 24 and down to June 20, and the entry of the judgment in the action upon the contract for the amount due up to June 22, 1882, constituted an election to hold to the contract, and that the plaintiff, having elected to affirm the contract as it was, is bound by that election (see Washburn v. Great Western Ins. Co., 114 Mass. 175, cited with approval in Steinbacher v. The Relief Ins. Co., 77 N. Y. 499; Moller v. Tuska, 87 Ib. 166; Strong v. Strong, 102 Ib. 73.), and cannot now claim that the letters Avere such a breach of the contract as would entitle him to recover.

I am also oí the opinion that the finding of the referee on the first cause of action, affirmed by the court, and standing unreversed, was conclusive as an adjudication that the contract was in force to the 22d of June, 1882, and there was therefore no breach of the contract prior to that time.

As before stated, the judgment between the same parties in favor of the plaintiff on the first cause of action entered on the referee’s report is an adjudication that the contract was duly executed between the plaintiff and the Atlantic and Pacific Telegraph Company; that the plaintiff was entitled to enforce the same ; and that the defendant was liable under the provisions of the contract; but it is also an adjudication that the contract was in force between the parties up to the 22d of June, 1882, for the referee finds that collections were made by the* defendant for said plaintiff, under the said contract, up to June 22d, and that the telegraph service rendered by the defendant to the plaintiff, from the 3d of February, 1881, to the 22d of June, 1882, under the terms and conditions of the contract, amount to the sum named, and for the balance due under the terms of the contract the plaintiff Avas given judgment.

The case of Davis v. Talcott, 12 N. Y. 187, Avas an action to recover for a breach of a contract on the part, of the defendant, which breach was denied, and on the trial the defendant proved that in a former action betAveen the same parties, in which the defendant in this action was plaintiff, he had recovered judgment upon the contract, and the court held that that former judgment was a bar to the action; that the plaintiff in the former action must have established his title to the prices stipulated, by proof that the agreement Avas carried out; that the defendants in that former action were at liberty to meet and combat those proofs bv counter evidence on their part; and that the report of the referee in that former action, followed by the judgment of the court, estopped the parties to that suit front ever after questioning that fact in any controversy arising upon the same agreement.

In Bogardus v. N. Y. Life Ins. Co., 101 N. Y. 334, the court say: “ It is essential to the legal status of a cause of action on contract, that it should show an existing contract, and. a performance by the plaintiff. These facts must be alleged, and .if denied proved on the trial.” Applying this principle to the case at bar, to entitle the plaintiff to recover on the first cause of action, it was necessary for him to prove that the contract was executed and was in force to the 22d of June, and the report of the referee, followed by the judgment of the court allowing a recovery on the contract to the 22d of June, was an adjudication that the contract was in force to that time.

In Krekeler v. Ritter, 62 N. Y. 374, it was held, “ that a former judgment is competent to disprove a material allegation of the complaint, traversed by the answer, and as evidence it is conclusive as an adjudication of the same fact in the action between the same parties; that the same facts could not be retried between the same parties.

It being thus established that there was no breach of the contract by the defendant prior to the 22d of June, 1882, and as the evidence fails to disclose that the defendant committed any breach of the contract after June 22d, or after that date'did any act which could be construed into a refusal to perform the contract, but on the contrary shows that on June 22d, the plaintiff voluntarily ceased business under the contract because he had no money to carry on business, I am of the opinion that the plaintiff failed to establish a breach of the contract by the defendant, and without considering the other serious questions presented by the appeal, I think the judgment should be reversed and a new trial ordered with costs to abide the event.

Freedman, J. (concurring).

concur with Judge Ingraham that upon the case as it came before us, the plaintiff failed to establish a total breach of the contract by the defendant, before he, the plaintiff, voluntarily ceased business under the contract. I therefore agree to reverse and to order a new trial.

Sedgwick, Ch. J. (concurring).

am of opinion that the damages were excessive, and on that ground agree with Judge Ingraham in the result stated by him.


source: Caselaw Access Project

author: By the Court.—Sedgwick, Ch. J.

license: Public Domain

text:
    FRANK M. GILLETT, et al., Respondents, v. WILLIAM I. WHITING, Appellant.

      Charge—A refusal to charge on request an abstract proposition of law, not error—Ratification of agent's acts, promise to pay, no new consideration necesssary—Charge, when an exception to the validity of a particular proposition cannot be questioned.

      Refusal to charge abstract proposition. In an action by a broker to recover money expended by him in the purchase for another of stocks on a margin, less the margin and the amount realized on a sale by' him of the stock, a refusal to charge that if no notice was given, the sale was a conversion, is not error, it not appearing what amount of. damage the defendant (for whom the stock was purchased) suffered from the sale at the particular time when it took place.

      Ratification of acts of agent. Where one employed by another as his agent, does certain acts as being within the terms of his employment, and thereafter presents an account to his principal showing the acts so done, and a balance due him from the principal on account of the transactions set forth in the account, and the principal accepts the account and promises to pay the balance shown by it, such acceptance and promise will operate as a ratification of the transactions resulting in such balance and no new consideration will be necessary to support the promise. The principal cannot thereafter defeat an action brought to recover the balance on the ground that the transactions resulting in such balance were unauthorized by him.

      Exception to charge, not bringing up for review. Under an exception to a

      portion of a charge, if some of the propositions therein contained are correct, the validity of other propositions therein cannot be questioned on appeal.
    Before Sedgwick, Ch. J., and Ingraham, J.

      Decided January 3, 1888
    Appeal by defendant from, judgment entered upon • verdict for plaintiff.
    The facts sufficiently appear in the opinion.

      Hill, Wing & Shoudy, attorneys and of counsel, for appellant.

      Ira D. Warren, attorney and of counsel, for responddents.
   By the Court.—Sedgwick, Ch. J.

This action was brought by plaintiffs for the recovery of money expended by them, at the alleged request of defendant, in the purchase of certain stocks, as his brokers, upon margins furnished by him, less those margins and the amount realized from a sale of the stock.

On the trial, the counsel for defendant claimed that there was no evidence that the plaintiffs gave to the defendant notice of the time and place of sale, and asked the court to charge the jury, that if no notice were given, the sale was a conversion by the plaintiffs, and excepted to the refusal of the court to charge as requested. The refusal was not error, for the fact of conversion did not go to the whole damages asked by plaintiffs, but entitled the defendant to a reduction of plaintiffs’ damages by the amount proven to have been suffered by defendant from the sale at the particular time when it took place. No such amount was proven. Baker v. Drake, 53 N. Y. 211, and the cases that follow it.

The defendant testified in substance, that the stock bought for him. by the plaintiffs, was not of the kind ordered by him. The plaintiffs testified that after the sale of the stock they made up the account and presented it to the defendant, and that he accepted it, and promised to pay the balance stated in it. The court charged that the acceptance and the promise, if the jury found for the plaintiffs in that respect, were a ratification of the plaintiffs’ purchase originally. This was correct. The promise needed no new consideration. Commercial Bank of Buffalo v. Warner, 15 N. Y. 577.

Of the acceptance, as claimed, of the purchase, the court said, of the defendant, It wras his duty, either to accept or refuse to accept it. . He had a right to say, I will not accept that stock. If he did not say that, then he did accept the stock. That, in connection with the other evidence that I have called your attention to, of the presentation of the account and his promise—if he did promise to pay the account as presented,fif you believe the testimony—was a ratification of the acts of the plaintiffs, and bound him to accept that stock, namely, the Ohio stock and the Chicago and Northwestern.” Defendant’s counsel excepted to this portion of the charge. The counsel for the defendant supposes that the validity of this charge can be questioned upon this appeal. It was in fact followed by several propositions which were correct, and the exception that was taken applied, rather to these propositions than to those that had preceded them.

The judgment should be affirmed with costs.

Ingraham, J., concurred.


author: By the Court.—Sedgwick, Ch. J. Ingraham, J.,

text:
    JAMES S. CARRADINE, Respondent, v. HORACE L. HOTCHKISS, et al., Appellants.

      Evidence, irrelevancy and incompetency of, instances—Ordering a party to read in evidence paper produced by adversary on his call—Exception to exclusion of document cannot be entertained on appeal, if document does not appear in appeal book.

      Instances of irrelevancy and incompetency. The question at issue being as to the kind of order giren November 16th, respecting transactions in stock, Reid, 1. Defendants’ agent having testified to previous orders and claimed them to be of a kind different from that of November 16th, that the exclusion of further evidence by another witness as to previous orders, was correct, as not tending to show that the order of November 16th, was of the kind claimed by defendants. 2. The question put by the defendants to a witness, not a party to the action, “Do you know whether he (the plaintiff) had acted upon your suggestion about this very stock or not?” was properly overruled, because it did not appear to be relevant, and if answered in conformity with defendants’ purpose, would have been only a source of confusion to the jury. 3. The question put to defendants’ agent, on his recall as a witness, asking whether in interviews had by him with plaintiff after November 16th, plaintiff said anything about canceling any discretionary order, was properly overruled, as the witness had before testified fully to what occurred at the interviews referred to in the question.

      Ordering a paper to be read. Defendants’ counsel examined the defendant orally as to the contents of a letter sent by him to the plaintiff. On the cross-examination plaintiff's counsel offered the letter in evidence, and defendants’ counsel objected on the ground that the contents of the letter were immaterial and irrelevant, and the objection was sustained ; afterwards defendants’ counsel, on the cross-examination of the plaintiff, drew out a conversation in which the plaintiff referred to the letter, and stated that his attorney had it, and that in it defendants’ agent had stated that stocks were going up; whereupon defendants’ counsel called for the production of the letter by plaintiff. It was on such call produced, and defendants’ counsel perused it. Plaintiff’s counsel demanded that defendants’ counsel should be directed to read the letter in evidence; the court against the objection of defendants’ counsel, made the direction, and the letter was then read in evidence by defendants’ counsel, it containing material evidence, though not favorable to the defendants. Held, that, without considering the law on the subject in general, the action of the court was, under the particular circumstances, correct.

      Exception to exclusion of document not printed. Where a written memorandum is excluded on the trial, an exception to the exclusion cannot bo entertained on appeal, unless the memorandum is set forth in the appeal book.
    Before Sedgwick, Cli. J., Freedmax and Ixgeahaií, JJ.

      Decided January 8, 1888.
    Appeal by defendants from judgment entered on verdict for plaintiff, and from order denying motion for a new trial made upon the minutes.
    The facts sufficiently appear in the opinion.

      T. Henry Dewey, attorney and of counsel, for appellants, on the question of error in ordering the appellants to send a certain letter in evidence argued :
    I. (a) The rule that the calling for the production of papers and inspecting them, makes them evidence does not obtain in the state of New York, and has been 0 so decided by the General Term of this court. Abbott's Trial Brief, 89; Kenny v. Van Horne, 1 Johns. 394; Stalker v. Gaunt, 12 N. Y., Leg. Obs. 124. (b) There are several decisions in England and other states sustaining the same view. Sayer v. Kitchen, 1 Esp. 210 ; Carr v. Gale, 3 Woodb. & M. 38; Austin v. Thompson, 45 N. H, 113; Withers v. Gillespie, 7 S. & R. 14; 2 Phillips Ev. 537; 1 Greenleaf Ev., § 563. Some of the text writers disapprove of the English rule on principle. 2 Phillips Ev., 537; 1 Greenleaf Ev., § 536, note 3. (c) It is stated that the rule in England is the other way. Stalker v. Gaunt, 12 N. Y. Leg. Obs. 124; Calvert v. Flower. 7 C. & P. 386; Wharam v. Rutledge, 5 Esp. 239; Wilson v. Bowie, 1 C. & P. 10;
      Stephens Dig. Ev. Art., 138; 2 Tidd’s Pr., 804; 1 Greenleaf Evidence, § 563; 2 Phillips Evidence, 537, n. 460; 1 Starkie Evidence, 403; Roscoe Evidence, 6. But even there the practice is not uniform nor are the decisions clear and satisfactory. Sayer v. Kitchen, 1 Exp. 210. See criticism on the supposed English rule in Austin v. Thompson, 45 N. H. 117. (d) In the Federal courts the practice is not uniform, but the weight of authority, it is submitted, is in favor of the New York rule. Carr v. Gale, 5 Woodb. & M. 59; Coote v. Bank U. S., 3 Cranch C. C. 350; Waller v. Stewart, 4 Ib. 532; Jordan v. Wilkins, 2 Wash. C. C. 482, 484. (e) In Maine, Delaware, Massachusetts, Georgia and Mississippi, the English rule seems to have been followed. Blake v. Russ, 33 Me. 360; Randall v Chesapeake & Delaware Canal Co., 1 Harr. 233, 284; Clark v. Fletcher, 1 Allen, 53, 54; Long v. Drew, 114 Mass. 77; Wooten v. Nall, 18 Geo. 609; Anderson v. Root, 8 S. & M. 362.
    II. (a) The substance of the letter was utterly irrelevant to the matter in controversy. It was dated November 15th, and had no relation whatever to what transpired on the 16tli. That it was irrelevant had been expressly decided by the court. The plaintiff had before attempted to get this very letter in, but it had been ' ruled out as irrelevant and immaterial, (b) Whatever may be the rule as to the right of the party producing a paper upon notice, to offer it in evidence, or to require the party calling for it after an inspection, to put it in evidence, it has never been claimed that evidence which is utterly immaterial, could be, or be required to be put in. Abbot’s Trial Brief, 89; Wilson v. Bowie, 1. C. & P. 10; Hylton’s Lessee v. Brown, 1 Wash. C. C. Rep. 343 ; 2 Phillips Evidence (ed. 1859), 537 ; Withers v. Gillespy, 7 S. & R. 14, n. 460.
    III. It is to be observed that in none of these cases was it ever claimed that an attorney calling for and inspecting a paper might be ordered to read it to the jury, or that such an order ever was made. The most that was claimed or decided was that the paper was thereby made evidence for the other side, if he chose to use it. This was well expressed in Clark v. Fletcher, 1 Allen 63 ; 2 Phillips Ev. 537, says: “It has been held that if the party who has called for the books, inspects them, he thereby makes them evidence for the other side, although he has not himself used them in evidence. But the principle of this rule is not clear; and it seems questionable, whether the rule does not go too far.”
    IV. The rule contended for does not apply to a paper incidentally produced on a trial. Withers v. Gillespy, 7 Serg. & Rawle 14; 2 Phillips on Evidence (ed. 1859) 537, n. 460; Austin v. Thompson, 45 N. H. 118.
    Y. The inspection of this paper disclosed the fact that it had been previously ruled out as irrelevant and immaterial, and it would be harsh and absurd to make the paper, under such circumstances, evidence. In fact, this should properly take the case out of the discussion at all, because there was really no inspection of the letter, within the meaning of the rule. Phillips (ed. 1859), 337, n. 460, in discussing the conflict in the cases says: “ It will be seen from the foregoing cases, that the only appearance of conflict has been as to whether the act of perusing or inspecting the paper would lay the party calling for it, pursuant to notice, under the obligation of considering it evidence. That merely calling for the paper is not enough to produce such consequences, seems agreed.”
    YI. This letter was very injurious to the defendants.

      Knox & Morrison, attorneys, and Samuel G. Jelliffe of counsel, for respondent, on the question of error in ordering appellants to read a certain letter in evidence, argued:
    “When a party calls for a document which he has given the other party notice to produce, and such document is produced to and inspected by the party calling for its production, he is bound to give it as evidence, if the party producing it requires him to do so, and if it is or is deemed to be relevant.” Mead v. Shea, 92 N. Y. 126 ; Day v. Roth, 18 Ib. 451. (These appear to be wrong citations.—Reporters.)

   By the Court.—Sedgwick, Ch. J.

The first exception argued by the learned counsel for the appellants, is to the exclusion of a question by defendants’ counsel, put to the witness, Lord : “ Do you remember the occasion when a conversation took place between the plaintiff and one of the defendants when Richmond Terminal Stock was about 45 ?

The important issue in the case was whether the plaintiff had given on November 16th a discretionary order to the defendants, to deal in the stock for the plaintiff as they saw fit. .

The counsel for defendants declared that the question was asked to prove that there had been a “previous fine of discretionary employment and agency.” This sufficiently shows that the question was not aimed at an interview of November 16tli. This is also shown by the price alluded to in the question, for on the 16th of November the stock was not about 45.

The learned judge was correct in holding that further evidence as to the orders given before the 16th of November would not tend to show that the order of the 16th of ¡November was of the kind claimed by defendants. The-defendants’ agent, Blanchard, had testified to the previous order, and had claimed them to he of a kind different from that of the 16th of November. The only discretion of those orders was to select a price about 45.

The next exception was to the exclusion by the court of a question asked of a witness, not a party to the action, “ Do you know whether he had acted upon your suggestion about this very stock or not?” The exclusion was correct. The time pointed at by the question, included transactions foreign to the issue. In the absence of testimony as to the nature of the suggestion, the question did not appear to be relevant. If the question were asked and answered in conformity with the purpose of defendants, the answer would have been, “Yes,” and this would have been only a source of confusion to the jury.

Blanchard, defendants’ agent, was examined as a witness and recalled. Then he was asked, “ At any one of the interviews that you had with Dr. Carradine, on and after the 16th day of November, did he say anything about canceling any discretionary order which he had given you ? ” etc. The object of the question, as avowed on the appeal, was to show a tacit recognition of the discretionary order, by his omission to speak of it. The answer would have involved only an inference or argument, which the jury might have made as well, because the witness in his earlier examination had fully testified to the contents of all the interviews referred to in the question.

The next exception refers to the court ordering the defendants’ counsel to read a letter written by the agent of the defendants in the transaction, and which the defendants’ counsel had then called upon plaintiff’s counsel to produce, which had been then produced and perused by defendants’ counsel, but not offered in evidence.

Without considering the law on this subject in general, I am convinced that the particular circumstances show that the court’s action was correct.

In the first instance, the defendants had taken advantage of what they pretended were the contents of the letter, by examining the writer of it, orally, as to those contents. He testified as follows: “ On the Í5th I sent a note to the plaintiff’s residence, saying to him that the day before I had heard that Richmond Terminal stock was to be put considerably higher, by the pool manipulating it, and advised him in this note to buy in his short stock, which he was short of, and put it out higher.” On cross-examination,- the counsel for the plaintiff offered this letter in evidence. The defendants’ counsel objected, on the ground that the contents of the letter were -immaterial and irrelevant. The court sustained the objection.

Afterwards the plaintiff was examined as a witness. The defendants’ counsel, on cross-examination, drew out a conversation in which the Avitness had referred to the letter, and that his attorney had it, and that in it the defendants’ agent had written that stocks were going up. The defendants’ counsel called for the letter and perused it, and against his objection,.was directed to read it as evidence, upon plaintiff’s counsel demanding that he should be so directed.

The defendants’ counsel had twice given oral evidence of the contents. He had learned the contents of the letter when he had objected to them as immaterial and irrelevant. That objection he, in substance, withdrew when he called for the oral contents from the plaintiff as a witness. Therefore when he demanded a production of the letter and took possession of it, he then placed himself upon the ground that the letter did contain material testimony. And in fact it did, although not favorable to the defendants. In my opinion, he could not withdraw from the ground he had taken, and was properly directed to give the primary evidence of what he had already given secondary evidence of. At all events, the defendants should not be permitted iioav to say that competent testimony as to their admission, contained in their own letter, was injurious to them as tending to prove what in reality were the facts of the case.

If the exception to the refusal of the court to allow the defendants to give in testimony, a memorandum Avhich they contended was of a discretionary order, were valid at the time, it cannot now be sustained on the case as made. For the contents of the memorandum do not appear. It cannot be affirmed that they directed a discretionary order, and the appellate court cannot say that the appellant was aggrieved.

The judgment and the order appealed from should be affirmed with costs.

Freedman, J., concurred.

Ingraham, J.,

concurring in result.—I think that the letter of November 15, 1886, was competent evidence, and that it was immaterial whether introduced by the defendants or plaintiff. I therefore concur to affirm the judgment.


author: Dugro, J. By the Court.—Sedgwick, Ch. J.

text:
    ADOLPH STRASSER, et al., Respondents, v. ADOLPH MOONELIS, Appellant.

      Labor associations (unincorporated) right to adopt device—Infringement ' on device may be enjoined—This in action by some, on behalf of all members—Illegality or contravention of public policy not sufficiently shown.

      Bight to adopt a device. An unincorporated association of operatives, performing work on materials furnished to its members thereby producing an article manufactured out of such materials by their work, may adopt a device for the purpose of designating that the articles contained in a receptacle, to which it is attached, were made by a member of the association.

      Protection of right. The members of such association have a property right in the device so adopted, which is entitled to the protection of a court of equity, on the same principle, and under the same circumstances and restrictions, upon and under which courts protect trade marks and good-will.

      Parties plaintiff to action. One or more members of such association (the members thereof being numerous) may sustain an action, on behalf of themselves and all the other members, to restrain an infringement on such device.

      Illegality not established. The fact that one of the objects of the association is to maintain fair wages for its members, and that the association furnishes its labels bearing its device thereon, to those shops and manufactories only, which employ exclusively its members, do not conclusively show that its object was illegal as against public policy.
    Before Sedgwick, Ch. J., Freedman and Ingraham, JJ.

      Decided January 3, 1888.
    Appeal by defendant from an order continuing an injunction order. The motion to continue came on at Special Term, where the following opinion was delivered:
   Dugro, J.

The plaintiffs complaining on behalf of themselves and of all other members of the “ Cigar Makers’ International Union of America,” show that they are cigar makers and members of the “ Cigar Makers’ International Union of America”; that said union is a voluntary unincorporated association of practical cigar makers, formed for the purposes of promoting the mental, moral and physical welfare of its members, by assisting them to obtain labor at remunerative prices, by affording them pecuniary aid in sickness, and generally to maintain a high standard of workmanship, and ■fair wages of cigar makers; that for the purpose of designating the articles manufactured by members of the union, the union devised and adopted a trade-mark or label to which they gave the name of union label,” a fac-simile of which label is attached to the complaint.

That prior to the adoption of said label, the same had not been known or in use in this country or elsewhere, and ever since said adoption the members of said union have been, and are, exclusively entitled to the use of said labels, and the same have been conspicuously pasted on the outside of cigar boxes containing the cigars made by the plaintiffs and other members of the union, on whose behalf the action is brought.

That the said label affixed to cigar boxes is intended as a guarantee that the cigars therein contained are manufactured by members of the union, and that fair wages' and good workmanship have been thereby secured; and that the cigars were not made in tenement-houses or state prisons; and for those reasons the same command a higher price in the market than cigars of a similar appearance, but without said label; and that the use of the said label is a source of great profit to the plaintiffs and others on whose behalf this action is brought.

Plaintiffs further show that the defendant has been and is infringing the exclusive right of the plaintiffs and the other members of the union to the use of the said label, in that defendant, with intent to defraud plaintiffs and deceive the public, has sold, and is offering for sale in New York city, boxes of cigars bearing labels which falsely purport to have been issued by the Cigar Makers’ International Union of America, and which labels are such close imitations of the genuine labels used by plaintiffs, as aforesaid, that they are calculated to and do deceive and mislead the public into the belief that the cigars sold by defendant are manufactured by members of the aforesaid union; and that the labels used by defendant are false and spurious imitations of the genuine labels and trade-mark of the plaintiffs.

Plaintiffs further show that by reason of defendant’s wrongful acts, irreparable damage and injury are caused to them, and therefore they pray for an injunction and account, and for damages.

The defendant, answering on information and belief, denies the use by him of counterfeit labels; he further denies that he has sold, or offered to sell, cigars not made by members of the “ Cigar Makers’ International Union of America ” in boxes bearing labels falsely purporting to have been issued by said union; and for a further defense he alleges as follows: that the plaintiffs are not, nor is the alleged union, manufacturers of cigars in a proprietary sense, or in any right of proprietorship; nor do they, or it, have any right of property, possession or control in cigars made by its alleged members or otherwise ; nor do they, or it, have any interest in, or ownership in, or control over the product of the labor of the several alleged members of said alleged union, or of any of them; nor do they, or it, have any royalty on the manufacture or sales of any cigars, ■whether having said alleged label or trade-mark affixed, or otherwise; nor do they, or it, have any share or interest in the profits of any sales made by any of its alleged members. Defendant, however, does not deny the use by him of genuine union labels on boxes containing cigars manufactured by non-union workmen, or others, not members of the said union.

The affidavits presented by plaintiffs, and a comparison of the genuine and spurious labels, compel me to the view that such a state of facts appear herein as calls for—one question conceded—an injunction pendente lite. The question to which I refer, is that raised by the defendant in his contention, that the plaintiffs are not the owners or manufacturers of cigars, but merely laborers employed to convert the material provided into the article of trade. The defendant’s counsel, on the argument and in his brief, lays great stress on the fact that the label presented in this case does not come within the settled definition of a trade-mark, as he claims it to be.

It is needless to discuss this phase of the case, for the right to the exclusive use of this label may be sustained, although it fail to be a trade-mark in the precise definition of the term as heretofore used. For whether we call the property-right, which I believe the plaintiffs have in the label, a trade-mark, or by another name, is a matter of slight import. It is a right entitled to the' protection of a court of equity on the same principle as that upon which courts have based their right to protect trade-marks and good will. It has been accepted as the rule that the court “proceeds upon the ground that a person has a valuable interest in the good will of his trade or business; and that having appropriated to himself a particular label, or sign, or trade-mark, indicating to those who wish to give him their patronage, that the article is manufactured or sold by him, or by his authority, or that he carries on his business at a particular place, he is entitled to protection against any other person who attempts to pirate on the good will of his friends or customers, or the patrons of his trade or business, by sailing under his flag, without his authority or consent.”

It needs no deep study to perceive that the laborer has the same valuable interest in the good Avill of his labor as a manufacturer has in the good Avill of his trade. Every man has a property right to the result of his labor, and that he has sold this right by a contract for wages, is no reason Avhy he should be deprived of the right to designate the origin of the result of his Avork. That it is impossible to attach to this result any badge or label indicative of origin or interest, unless with the consent of the owner of the physical property itself, does not affect the principle applicable to the case.

If certain laborers who, through a union, in the adoption of and in compliance Avith any set of rules Avhich guarantee or purport to insure a certain class of labor, have thereby increased a demand for their particular labor, and if this union sees fit to designate the labor of the members by any particular symbol, label or sign which is descriptive of the origin or ownership of the labor, such a device as may be adopted is entitled to the protection of a court of equity from fraudulent simulation.

The right to the label seems to me to be a valuable one, for it appears that boxes of cigars to which the label is affixed sell in. the market for a higher price than the same cigars sell in boxes upon which the label does not appear. It is clear that if this be so, the natural result of the use of a fraudulent simulation of this label on boxes of cigars without the authority of the union, is such an injury as entitles them to the protection of the court.

The label of the plaintiffs, used as the symbol of their labor, does not conflict with the rules applicable to trademarks, or any analogous rules, and so, for the purpose for which it is used, it can be considered' proper and entitled to protection.

The plaintiffs are entitled to be protected in the use and value of their property, and as in this case it can be adequately protected only by an injunction, an injunction pendente Hie will issue; order to be settled on notice.

In addition to what is stated in opinion of Judge Dugeo, the complaint, answer and affidavits read before him contained the following, assumed to bear on the question as to the object of the association being illegal and in contravention of public policy:

In the complaint it was alleged that:

u Plaintiffs are severally cigar makers, residing in the United States, and members of the Cigar Makers’ International Union of America, that said Cigar Makers’ International Union of America is a voluntary unincorporated association of practical cigar makers, formed for the purposes of promoting the mental, moral and physical welfare of its members by assisting them to obtain labor at remunerative prices, by affording them pecuniary aid in case of sickness, and generally to maintain a high standard of workmanship and fair wages of cigar makers.”

In the answer it was alleged on information and belief : “ that the plaintiffs are not, nor is either of them, nor is the Cigar Makers’ International Union of America, manufacturers of cigars in a proprietary sense or in any right of proprietorship, nor do they or it have any right of property, possession or control in cigars made by its alleged members or otherwise, nor do they or it have any interest or ownership in or control over the product of the labor of the several alleged members of said alleged union or of any of them, nor do they or it have any royalty on the manufactures or sales of any cigars whether having said alleged label or trade-mark affixed or otherwise, nor do they or it have any share or interest in the profits of any sales of any cigars made by any of its alleged members, but, on the contrary, all employers and owners are excluded from any capability of membership in such alleged association or union. That said alleged union is a combination of workmen to maintain a high standard of wages and to resist the employing class more effectually by union against reductions in wages than can be done in the absence of combination, and that the benevolence of the alleged union is confined to its own membership, and has no thought, or pretense of protecting the public interests or welfare except as they may happen to coincide.” And in an affidavit read in opposition to the motion, it was sworn to by the defendant: that the plaintiffs are working cigar makers, and that neither they nor the alleged Cigar Makers’ International Union have any factory, nor do they make cigars for themselves, but only as workmen for other proprietors, transacting no business or trade whatsoever in cigars as makers, dealers, or otherwise. In the year 1886,1 entered into an agreement in writing with certain alleged representatives of local unions of said alleged International Union, to make my factory a union shop and to receive the union labels. I agreed to' pay certain prices according to a scale, and the loca| unions agreed to supply me with labels of the so-called International Union and to admit my employees into the local unions. They broke the agreement ' by refusing to admit any more members, and thereupon the shop was declared no longer a so-called union shop, and no more labels were supplied. No control whatever over the quality of either tobacco or cigars was retained or exercised by said International Union or the local unions, nor had either any proprietorship or interest whatever in the product, business, profit or loss of my factory. The alleged 25,000 and over members of said alleged International Union are employed in several hundred different factories and proprietor,ships scattered all over the United States, of which no two produce similar goods in all respects.”

Johnston & Tilton, attorneys, and Lewis Johnston, of counsel for appellant, argued:

I. The practice of the union in refusing to allow its members to work in the same factory with non-members makes it an unlawful combination, and puts it beyond the protection of the courts of equity. The court is referred to the statute on the subject of labor unions. 3 R. S., 7 ed., p, 2527; Laws 1870, ch. 19;. and Wright on Criminal Conspiracies, pp. 144 to 169; Stevedores Association v. Walsh, 2 Daly 1.

' II. The Cigar Makers’ International Union label is not a trade-mark, or entitled to any protection from the court. Worcester, Webster and Bouvier define a trademark to be “ a particular mark, sign, device, writing or ticket put by a manufacturer upon his goods, to distinguish them from those of others.” See also Brown on Trade-marks, 2d ed., § 537, § 60; Peitz y. Eichele, 62 Mo. 171; Croft v. Day, 7 Beav. 84; Congress and Empire Spring Co. y. High Rock Congress Spring Co., 57 Barb. 526 ; 4 Anuales, 19, 20, 54; Upton on Trademarks, p. 9. A trade-mark must be used to indicate, not the quality, but the origin or ownership, of the article to which it is attached. Newman y. Alvorcl, 51 N. Y. 193; see 2 Pars, on Cont. flth ed.) 351; Matsell v. Flanagan, 2 Abb. Pr. R. JSF. 8. 459; Amoskeag Co. v. Spear, 2 8andf. 599; Samuel v. Berger, 4 Abb. Pr. 88; s. c., 24 Barb. 163; s. c., 13 How. Pr. 342; Holty. Me"nendez, 23 Fed. Rep. 869 ; Collins Company y. Brown, 3 Kay & Johnson, 423 ; s. c., 3 Jurist N. 8. 929 ; Leather Cloth Co. v. Amer. L. C. Co., 11 Lb. 513; s. c., 35 L. J. Chan. 53; s. c., 4 De Gex, Jones & Smith, 137; Blanchard v. Hill, 2 Atkyn’s R. 484.

III. The legislation of the state upon this subject is comprised in sections 364, 366, 368, Penal Code; Laws 1862, chapter 306; amended Laws 1863, chapter 209; also Laws 1878, chapter 401. These statutes all proceed upon the theory of a right growing out of property or ownership in the goods by the owner of the trademark or label.

IV. The label of the Cigar Makers’ International Union is not a trade-mark or proprietary label, because it is not the device or symbol of the manufacturer or a merchant or trader to distinguish the goods from those made or sold by another. This label is indiscriminately supplied by the union to all manufacturers of cigars who employ members of the union exclusively as workmen, and therefore is entirely outside the protection intended to be afforded by law to the device of the manufacturer originated by him and applied to his own products, which is protected because, by his having originated and used it, he is esteemed to have acquired a valuable good will and name with the public which should not be at the mercy of any infringer to destroy. Bisphan’s Principles of Equity (4th ed.),p. 457; Hazard v. Caswell, 93 N. Y. 259; Wolfe v. Burke, 56 Ib. 115; Fetridge v. Wells, 13 How. Pr. 385; Amoskeag Man. Co. v. Spear, 2 Sandf. 599; Ferguson v. D. Mills, 2 Brewster (Pa.) 314; Candee, Swan & Co. v. Berre & Co., 54 Ill. 439.

9V. The purpose and intent of the union are foreign to the interests which the law of trade-marks guards and protects. The real object of the union is to prevent its members from working for less wages than it sanctions, and to compel manufacturers to employ exclusively members of such union under the penalty of being deprived of the patronage of all who are members of or sympathize with labor unions, or in other words being boycotted ” by the labor union fraternity. Stevedore’s Asso’n v. Walsh, 2 Daly 13.

VI. The union label is professedly put upon the productions of hundreds, perhaps thousands, of factories, and therefore does not indicate the production of any one of them. It merely indicates that the shop where the cigars are made is a union shop, employs none but union men, and cannot therefore in the nature of things be any guaranty of quality of tobacco, method of curing, flavoring, rolling, bunching, drying or preserving, and only insures that it is not made by a workman taking more or less pay than the union allows. Negatively it purports to assume that the cigars are not made in prisons or in tenement-houses.

VII. The union label does not claim that Mr. Strasser, whose name is affixed to it, or that any other person or concern is the manufacturer of the cigars so labeled. The evident object of the workmen who issue the label to manufacturers is to monopolize the work in shops of the trade of manufacturing cigars to its members, to the exclusion of those entitled to better wages because of greater skill, or of those non-members who because of their necessities are willing to work for less or even the same wages.

VIII. The principle contended for by plaintiffs is one which a court of equity cannot encourage or rightfully protect. It seeks to engraft compulsorily upon the product of the laborer in the hands of his employer an earmark ”, of his own which he cannot insist upon against the will of his employer. He may battle and contend for the right. in his contract of service as a condition of service, but he cannot expect courts of justice to insert in his favor compulsorily in his contract of service an implied right to label the goods he produces with any evidence of his workmanship.

Briesen & Steele, attorneys, and Antonio Knauth of counsel, for respondents, argued :

I. The plaintiffs sue as members of an unincorporated association, having such a great number of members that it is impracticable to bring them all into court. Code of Civ. Proc., § 448; Bloete v. Simon, Super. Ct., Special Term. The defendant, by answering instead of demurring to the complaint, admitted the right of the plaintiffs to sue on behalf of the union, and cannot raise objection now on that ground.

II. There is no merit in the objection taken in defendant’s answer, that the members of the union do not own the cigars produced by them or control the manufacture. The label as used by the defendant contains an untruth, calculated to deceive the public, and to rob the members of the union of the fruits of their reputation, which they have successfully labored to earn. The law protects the maker of the commodity as well as the seller, if the article is made for the purpose of trade, and is sold to the public. The label of the union, on its very face, shows that it is to be a guarantee that the cigars sold under it are made by members of the union and not by prisoners, tenement-house workers, coolies or other objectionable and inferior workmen; it is a guarantee of the quality of the goods to the purchasing public. That guarantee is practically destroyed by the doings of the defendant. In such cases the courts will not search for technical obstructions, but enjoin the guilty party on the broad ground that there must be a remedy for the apparent injury done to the plaintiff and to prevent the further deception of the public. Amoskeag Man. Co. v. Spear, 2 Sand. S. C. 599; Matsell v. Flanagan, 2 Abb. Pr. N. S. 459; Gillott v. Kettle, 3 Duer 624; Coats v. Holbrook, 2 Sand. Ch. R. 586; Taylor v. Carpenter, 3 Story 458; Kinney v. Basch, 16 Am. Law Reg., N. S. 596; Anheuser Busch Brewing Assoc. v. Pisa, 24 Fed. Rep. 149.

III. Wherever this label has been before the courts of this country, the court has invariably held that the Cigar Makers’ International Union is' entitled to protection against the unauthorized use of it. Bloete v. Simon, supra-, Frantz v. Miller (unreported), Dwyer, J., Superior Ct. of Ohio; Frizzell v. Link (unreported), Phelps, J., Circuit Ct. of Baltimore city.

By the Court.—Sedgwick, Ch. J.

I am of opinion that the plaintiffs, being members of' the Cigar Makers’ International Union, had an interest in the proper use of the labels of the union, which might upon sufficient grounds, be protected by injunction against the inequitable use of those labels.

I also think that it did not appear conclusively, upon the facts presented in the motion below, that the object of the union was illegal or against public policy, and that the finding of the learned judge below on this subject must here be sustained.

There can be no doubt that the defendant had used, and was about to use, counterfeits of the labels.

The order should be affirmed, with $10 costs to the plaintiffs, to abide the event.

Freedman and Ingraham, JJ., concurred.


author: By the Court.—Sedgwick, Ch., J.

text:
    JAMES K. PLACE, substituted in place of Barker Place, as Executor, &c., Respondent, v. JEDEDIAH K. HAYWARD, Appellant.

      Substitution of party plaintiff, what forms no objection to granting order for—Executor plaintiff, legatee, when not substituted for.

    Where in an action brought by a plaintiff suing as an executor, the defendant sets up counterclaims and set-offs as against such plaintiff, and obtains judgment in his favor, from which the plaintiff appeals, and pending the appeal another person is substituted for the plaintiff, no question can arise on the appeal as to the right of the defendant to set up the counterclaims and offsets against the substituted plaintiff; therefore the fact that the defense is based on such counterclaims and offset, constitutes no objection to the making of an order of substitution.
    Where an executor, as such, commences an action, and after judgment therein for defendant, appeals to the general term, pending which he is removed and his letters revoked by the surrogate, and the defendant’s wife was appointed administratrix with the will annexed, but he still remains plaintiff in the action, a legatee in the will whereof the plaintiff was executor, will not be substituted for him, for the purpose of prosecuting the appeal, on the ground that the administratrix refused to prosecute it.
    Before Sedgwick, Ch. J., Freedman and Ingraham, JJ.

      Decided January 3, 1888.
    Appeal from order substituting James K. Place as plaintiff, in the stead of the former plaintiff.
    The action was begun in the name of Barker Place, as executor, &c., against the present defendant. Final judgment was for the defendant. Barker Place, as executor, &c., appealed from this judgment to the general term. Before the appeal was taken, proceedings were begun before the surrogate to remove Barker Place, as executor. The surrogate after the appeal, made a decree removing him, and revoking the testamentary letters that had been issued to him. Afterwards, James K. Place, named in the title of this proceeding as plaintiff, made petition to the surrogate, that letters of administration, with the will annexed, be issued to him, Place. In answer to this, Mrs. Emeline Hayward claimed that there ivas no occasion for making an appointment at all, and that if there were such occasion, letters should be issued to her. The surrogate determined that the claim in the present action was an unadministered asset of the estate, and therefore the surrogate had jurisdiction to appoint an administrator, and that Mrs. Hayward was entitled to the letters.

      On the application below, it appeared that James K. Place was a legatee by the will, and that Mrs. Hayward refused to prosecute this appeal. Thereupon the order appealed from was made, that James K. Place be substituted as plaintiff. The defendant and Mrs. Hayward severally appeal.

      George II. Phelps, attorney and of counsel for J. K. Hayward, appellant; Robert Godson, attorney, and George H. Phelps, of counsel for E. P. Hayward, administratrix, appellant, argued:
    I. This action, in substance, is a bill to redeem assets from pledges, made by the executor himself after his letters, for cash advances made to him by the defendant, at the time of the pledge. The defense is: 1. Set-off ' of these advances to the amount of the proceeds received on the collaterals so pledged. 2. Affirmative counterclaims for over advances. 3. Affirmative counterclaims for legal professional services rendered by defendant to the plaintiff in reference to the estate matters. Since the pledges were under seal, and admitted to be bona fide,plaintiff’s only possible remedy was by bill to redeem. The plaintiff is estopped from denying the mortgage purport of the writing under seal. McCrea v. Purmot, 16 Wend. 460; Story Eq. Jr., 371, n; Shadbold v. Bassit, 1 Lan. 124; Calkins v. Long, 22 Barb. 97; Gilleland v. Failing, 5 Den. 313; Coleman v. 2d Ave. R. R. Co., 38 N. Y. 201. It is obvious that representative offsets and counterclaims cannot be litigated in this action. Thompson v. Whitmarsh, 100 N. Y. 39, 40; Patterson v. Patterson, 59 Ib. 574; Austin v. Monroe, 47 Ib. 360; Ferrin v. Myrick, 41 Ib. 315. The words, “as executor,” are merely descriptio persones. Thompson v. Whitmarsh, 100 N. Y. 39. Even in a representative action by an executor against his attorney, who has received the estate’s money before the death, the attorney may counterclaim for services rendered the executor after the death as defendant has done here. Davis v. Stover, 58 N. Y. 473; Gopen v. Crawford, 43 How. 278. But how this cross-relief can be litigated without the presence of Barker Place we fail to understand.
    II. In a pledgor’s bill to redeem from his pledge, defendant may have affirmative relief upon all contracts with pledgor. To contend that the defendant shall not litigate his alleged advances is absurd, and we think that it is equally absurd to deny his right to have affirmative relief for overadvances in such redemption action. The writing up an executor’s own transactions in an executor form, does not deprive the defendant of cross-litigation of the same nature, and always has afforded, until this action, individual costs against the plaintiff. Holdrige v. Scott, 1 Ban. 303.

      Charles F. Wells, attorney and of counsel for respondent, argued:
    I. The administratrix is vested with the title to the choses in action involved in this action, and is a trustee for said James K. Place. It has been indicated in the action that it was properly brought by Barker Place in his representative capacity, and not individually.
    II. The court had the power to .make the substitution, and the cestui que trust had a right to substitution well established by law. Randall v. Dyett, 38 Hun 347; Davies v. N. Y. Concert Co., 41 Hun 492. It has now become very well settled where a trustee refuses upon a proper request made to him for that purpose, to take necessary legal proceedings for the protection of the beneficiaries under the trust, they may proceed for their own protection and the enforcement and maintenance of their rights and interests under the trust. Tilby v. Hayes, 27 Hun 251; Bockes v. Hathorn, 78 N. Y. 227; Randel v. Dyett, supra; . McHenry’s Petition, 9 Abb. N. C. 260; Edwards v. City of Watertown, 23 Week. Dig. 230; Barbour on Parties, 2d ed. 1884, p. 482; Blinkerhoff v. Bostwick, 88 N. Y. 52 ; Dodge v.
      Woolsey, 18 How. U. S. 331; Hubbard v. Medbury, 53 N. Y. 102; Western R. R. v. Nolan, 48 N. Y. 513. The proper way to ask relief is not by a new action, but in the action pending. Gould v. Mortimer, 26 How. Pr. 167; Segelken v. Myer, 94 N. Y. 473.
    III. The facts presented fully warranted the relief which was granted. Weetjen v. Vibbard, 5 Hun 267.
   By the Court.—Sedgwick, Ch., J.

The objections made that the action was not by the original plaintiff, as representing the testator, and that if the substitution is allowed, the defendant cannot maintain certain offsets and counterclaims of the answer, do not call for a reversal of the order. The surrogate determined that the basis of his jurisdiction to appoint an administrator, was that the claim in the present action was an unadministered asset. On the other hand, the question on the appeal from the judgment is whether it should be affirmed or reversed. This will involve the legal relation of defendant’s alleged counterclaims and offsets to the claim as made by the original plaintiff, Barker Place, as executor. No question can arise as to the right of defendant to set up the counterclaims and offsets against the substituted plaintiff.

I am however of the opinion that Mr. James K. Place showed no reason for his being made a substituted plaintiff, as long as Barker Place, as executor, etc., remained plaintiff of record. As Mrs. Hayward, as administratrix, was not a party to the action, no question could be litigated between her and Mr. James K. Place. Perchance, she might have a right to apply to be substituted, and might be made plaintiff. Until this was an accomplished fact, Mr. Barker Place, as executor, was plaintiff, and had sole right to be so deemed. Although he had been removed as executor, his removal did not, of itself, affect this litigation. As to it, he had the power' to allow a party in interest, such as Mr. James K. Place is assumed to be, to prosecute the appeal for the purpose of reversing the judgment. And on the facts that appeared on the motion below, Barker Place was not unwilling to permit this to bo done. Mrs. Hayward could not prevent such a prosecution of the appeal, excepting by some application to the court. Upon such application, the court could proceed to determine what were ■ the rights of Mr. James K. Place.

I therefore think that no case was made on the merits for the substitution ordered below.

Section 1296 of the Code of Civil Procedure, is not applicable to this case, and its terms imply a party in interest, in order to be made a party to an appeal, under its provisions, must succeed wholly to the right of the party of record.

Order reversed, with §10 costs.

Freedman and Ingraham, JJ., concurred.


text:
    WILLIAM B. LEONARD, as Receiver, &c., Respondent, v. ABRAM POOLE, Impleaded, &c., Appellant.

      Illegal contract-, when io warrant a recovery, recourse must be had to an illegal contract, an action cannot be maintained—Instance of a necessity for such recourse defeating an action.

    An agreement was entered into, whereby the parties on one side agreed to act as brokers and agents for the parties on the other side, in the purchase and sale of lard on joint account. It was a part of the agreement that the former should purchase, sell and hold the lard in their own name, and that the profits and losses, brokerage and expenses of purchases and sales were to be paid by the latter, and the former were to receive a certain brokerage and to be reimbursed for their outlay. The former made purchases and sales in their own name as principals. The object of the agreement was an illegal one ; to wit, to corner lard.

      Held, that the facts connected with the actual purchases and sales (apart from the agreement), would show that the former were principals as to the latter; to change this result and constitute the former agents and. brokers for the latter, recourse to the agreement would be necessary. Therefore, to sustain an action by the latter against the former, for an accounting by the former as agents and brokers, would be an endeavor to enforce part of an illegal agreement • and consequently the action would not be sustainable.
    Before Sedgwick, Ch. J., Freedman, and Ingraham, JJ.

      Decided January 3, 1888.
    Appeal by defendant from an interlocutory judgment, that defendant account, etc.
    The facts sufficiently appear in the opinion.

      L. A. Gould, attorney, and Joseph JJ. Choate of counsel, for appellant, on the questions considered in the opinion, argued:
    The plaintiff has no standing in equity to compel an accounting in respect of transactions carried on to create a corner in the lard market, or to force an advance in the price of lard. Greenhood on Public Policy, pp. 96, 97, and cases cited, Woodworth v. Bennett, 4 Hand 273; Kelly v. Develin, 58 How. Pr. 487 ; Rolfe v. Delmar, 7 Rob. 80; Campbell v. Wysham, 4 H. & J. 560; Campbell v. Anderson, 2 Dur. (Ky.) 384; Thorne v. Traveler’s Ins. Co., 80 Pa. St. 15; Clements v. Yturria, 81 N. Y. 285; Armstrong v. Toler, 11 Wheat. 258 ; Dunbar v. Johnson, 108 Mass. 519, and cases cited; Morris Run Coal Co. v. Barclay Coal Co., 68 Pa. St. 173; Craft v. McConoughy, 79 Ill. 346 ; Oscanyan v. Arms Co., 17 Am. L. Reg. N. S. 626, 633; affirmed, 103 U. S. 261; Keen v. Kant, opinion Judge Daniels ; Gregory v. Haworth, 25 Cal. 653, 657.

      Olin, Rives & Montgomery, attorneys, and Stephen H. Olin of counsel, for respondent, on the questions considered in the opinion, argued:
    If it be assumed that the relations existing between Keene, Washington Butcher’s Sons and D. & N. G. Miller, amounted to an agreement to tie up lard, which was against public policy and void, that constitutes no bar to the plaintiff’s recovery in this action. Murray v. Vanderbilt, 39 Barb. 140 ; Merrit v. Millard, 4 Keyes, 208 ; Berkshire v. Evans, 4 Leigh., 223 ; Tenant v. Elliot, L. Bosanquet & Puller, 3 ; Farmer v. Russell, 11 Ib. 296 ; Bonsfield v. Wilson, 16 M. & W. 185; Kiewert v. Rindskopf, 46 Wis. 485 ; Brooms Legal Maxims, 567-8; Tenant v. Elliott, 1 B. & H. 3; Farmer v. Russell, Ib. 296 ; Bondfield v. Wilson, 16 M. & W. 185; Anderson v. Moncrieff, 3 Deaussure’s Eq. R. 124-5; Planter's Bank v. Union Bank, 16 Wall. 483; Heckman v. Swartz, 50 Wis. 270; Wann v. Kelly, 4 Fed. Rep. 484; Woodward v. State, 2 North East Rep. 321; Sharp v. Taylor, 2 Phillips Ch. 801; McBlair v. Gibbs, 17 How. 232, 237; Brooks v. Martin, 2 Wall. 70; Cook v. Sherman, 20 Fed. Rep. 167; Lemon v. Crosskopf, 22 Wis. 447; Owen v. Davis, 1 Bailey S. C. Rep. 316; Gilman v. Brown, Miss. 641.
    The case of Keene v. Kent, opinion Judge Daniels, is not authority, because it was decided on another and different state of facts.
   By the Court.—Sedgwick, Ch. J.

The learned judge below found that the following facts existed: The plaintiff was the receiver, duly appointed, of the property of James R. Keene, and the defendant was one of the firm of E. A. Kent & Company. This firm .agreed ■with James R. Keene and other persons, who were defendants because they would not become plaintiffs, to act as brokers and agents of Keene and his associates, in the purchase and sale of tierces of lard, for their joint account. It was agreed that the profits and losses, brokerage and expenses of such purchases and sales, were to be paid to or by the associates, in specified proportions, and that E. A. Kent & Co. were to be entitled to, and were to receive, a brokerage of five per cent, for each tierce so bought and sold, and were to be reimbursed for their outlays. E. A. Kent & Co. had bought and sold under said agreement, but no account of the said transactions had ever been stated and adjusted between E. A. Kent & Co. and Keene.

The learned judge concluded, as matter of law, that the plaintiff was entitled to judgment, that the defendant Poole render a just and full account of all the dealings and transactions, purchases and sales, of lard, made and conducted by E. A. Kent & Co., under the agreement found to have been made, and that Poole be decreed to pay to plaintiff what may be found due to him, as receiver of Keene, on the accounting.

The complaint was dismissed as to the other member of E. A. Kent & Co. than Poole, because as to such other member the statute of limitations had been successfully pleaded as a defense.

If there were no other facts in the case, than such as have been stated, there could be no doubt, that an accounting was properly adjudged.

But the defendant requested the court to find as a fact, what in my opinion the testimony proved. That fact was, that the agreement referred to was made to accomplish an illegal object. Its provisions were adapted intentionally to such an object. That object was to withdraw lard from the public market, and create an artificial scarcity of it. The usual name of it was to “corner” lard.

The learned counsel for the respondent does not desire to deny that the agreement did have an unlawful object, but takes the position that the plaintiff does not ask to have any of its provisions enforced, and that, as the facts show that it has been carried out, the defendant is liable for what he retains in his hands as Keene’s and his associates’ broker and agent. The claim is that the defendant is as liable as agent, as if he had paid the proceeds into the hands of another agent of Keene to be paid to Keene, and who could not set up such a defense. That such other agent would be liable is true. Murray v. Vanderbilt, 39 Barb. 40 ; Merritt v. Millard, 4 Keyes, 408. It is not so clear that the defendant, if considered to be agent, would be liable.

I am inclined to think, that if the finding “ that, the transactions carried on resulted in a loss,” applies to the transactions exclusive of certain sales and purchases to and upon E. A. Kent & Co., themselves, and with which they should be charged, if they were brokers, this action would be for the recovery of some part of the margins furnished by Keene. In such case it would be necessary to consider if margin used for an illegal purpose can be recovered from the depositary, after their use in compliance with the unlawful agreement, and when the claimant cannot disaffirm the agreement. This matter was not discussed at the bar. The facts are not clear. And the' case will be decided from other positions.

The propositions for respondent as to. defendant’s liability, are not valid if the defendants did not act as brokers or agents, and did not become what may be called a depositary. I think that as matter of fact, upon all the legal evidence that can be presented, they were not agents in buying and selling the lard, but were principals, and in legal effect acted for themselves.

In the first place, the agreement as to E. A. Kent & Co. being brokers, included, as the judge found, a provision that Kent & Co. were to purchase, sell and hold said lard in their own firm name. He further found that defendants, or Kent & Co., made such transactions in their own firm name as principals. That is equivalent to finding that they were principals to all the world, excepting for the moment Keene and his associates. The facts connected with the actual purchases and sales, of themselves, would show that they were principals as to Keene and his associates. There would be no evidence that they were agents of the latter. To change this result Keene and his associates have no other resort, than to attempt to prove the arrangement that appeared in evidence. The substance of the arrangement was that while E. A. Kent & Co. were to act as principals as to others, they agreed to act as brokers as to the associates, for the purpose of carrying out an illegal object. The plaintiff therefore, endeavors to enforce a part of an illegal contract. Unless some force is given to the agreement to, act as brokers, there can legally be no evidence that they were brokers. Unless they were bound by the agreement to be brokers they were and they remained principals, and therefore not accountable to those who pursue them as brokers.

As I am of opinion that the plaintiff seeks to enforce an illegal agreement, I think the judgment should be reversed, and a new trial had, with costs to abide the event.

Feeedman and Ingeaham, JJ., concurred.