text:
    THE METROPOLITAN CONCERT Co. (limited), Appellant, v. HENRY E. ABBEY and EDWARD G. GILMORE, Respondents.

      Res adjudícala—when judgment is not.—■ Corporation oi'gamized under chapter 611, laws 1875—leases by.— Ultra vires—imperative necessity—burden of proof of.

    When a question is not in- issue on the pleadings, and would not have been available as a defense if it had been in issue, a judgment in the action against the defendant will not be res adjudicata on that question in a subsequent action when it is in issue and is available as a defense.

    Thus where an action was brought by a corporation lessor against the lessee for the rent reserved by the lease, which fell due during the lessee’s actual occupancy, and the question of the invalidity of the lease was not in issue on the pleadings, and judgment went against defendant, Held, in a subsequent action to recover rent for a period ensuing the lessee’s abandoning the occupancy, in which the invalidity of the lease was raised on the pleadings, that the former judgment was not res adjudicata on the question of the validity of the lease, since it was not in issue in the first action, and even if it had been pleaded therein, it would not have been available as a defense thereto, whereas in the second action, the invalidity was pleaded, and such invalidity constituted a defense.
    The power to sell and convey, given by § 2, chapter 611 of the laws of 1875, to corporations organized under it, does not include a power to lease, therefore—as by § 3 of Part I. R. S., chap. 18, title 3, no corporation can possess or exercise any corporate power except such as shall be necessary to the powers granted—-the making of a lease by such a corporation, of all its property, unless it be by reason of imperative necessity, is ultra vires, and the lease is void. In such a case, it rests on the corporation to show the imperative necessity.
    In the case at bar, plaintiff corporation, being the lessee of certain premises, made a sublease to defendant. Held, that in absence of proof by plaintiff that the premises could not be disposed of except by way of lease, the sublease was void. Held further, the business of plaintiff being to give musical entertainments, and the sublease being of the only property it possessed, and it not having given any musical entertainments or performed any legitimate corporate act for some years, that evidence as to reasons for ceasing to give entertainments was immaterial and irrelevant.
    Before Sedgwick, Oh. J., Truax and O’Gorman, JJ„

      Decided May 18, 1885.

      Appeals from two judgments entered on the report of a referee, dismissing the plaintiff’s complaints.
    The facts appear in the opinion.

      Davenport & Leeds, attorneys, and John 8. Davenport, ■of counsel for appellant, argued:
    I. The power to sublet is necessary to the exercise of the business power of the corporation. A business corporation must, of necessity, do a vast variety of acts, any one of which, if done by it repeatedly, and as a business, would be in violation of its charter and in excess of its powers. If a man were charged with the conduct of carrying on a concert business, with the general statement that he had all the authority necessary to carry on that business and no other, and he were to hire a hall at a rent which proved ruinous for that business, he could not excuse himself from a charge of willful neglect if he stopped the business, left the hall idle and simply wasted the capital in paying the rent, instead of subletting the hall and hiring a cheaper one, on the ground that his principal had given him no authority to do such an act; and no more could these directors, if they had not sublet. The ruling that the sublease in this case is ultra vires, produces substantially the above result. It says to the directors, you had no power to do anything but pay the rent, if you could not sell the lease, and yet you had power to do anything -necessary to carry on the business. There is nothing in the facts, in the statute, or in any decision cited, to mark an isolated act of subletting an unnecessary hall as distinct from any other of the thousand and one unclassified acts which any business corporation may find it necessary to do. For example^: the corporation might employ a musical director fdr’five years, and finding him too high-priced, agree to sublet him to some one who would pay the major part of his salary. Would it not be absurd to say that such an act was not necessary to the “exercise of the power to carry on its business ?”
    II. The presumption is that the corporation was acting legally. Assuming that .subletting has nothing mysterious about it to distinguish it from any other of the innumerable acts which a business corporation may be able to do, this judgment can only be sustained on the theory that when a corporation does one of those acts, it is presumptively violating the law. If this is correct, the position of a director in such a corporation is such that no responsible man could accept it. He must, every day, do a vast number of things under the general power of what is necessary. He must, because it would be negligence not to. But he must also take the risk of their being necessary, and must always be ready with sufficient evidence of the environment of the act, or be held guilty of a breach of trust.- He is put, also, in the position, utterly unknown to our law in all other cases, of being required to act, and yet on the one hand without the protection of the usual presumption that a man acts legally, and on the other of having the existence of facts presumed in order to charge him with illegality ; namely, if the directors sublet the hall, which hall, as found by the referee, was not necessary to the general business of the corporation, the law will presume that they could have sold the lease, or that they could have gone on and done business profitably in the hall; that they could have profitably and properly exercised their powers under that specific lease. The proposition that the law will accept such violent presumptions of fact, and on those presumptions call upon a man to prove himself not guilty, is astounding. On the other hand, the presumption that an act which might be necessary under certain circumstances, if done, was done in good faith, and under such circumstances as not to be illegal, is a mere refusal to presume that the directors committed a breach of trust. There is no authority to the contrary, and we cite several directly in point (Farmers’ L. & T. Co. v. Clowes, 3 N. Y. 470 ; Chatauqua Co. Bank v. Risley, 49 Ib. 381 ; De Groff v. Am. Lin. Thread Co., 21 Ib. 124 ; Farmers’ Loan & Trust Co. v. Curtis, 7 Ib. 466).

      III. The permission to sell is not a prohibition to lease. The statute says, “ may sell and convey.” Further on it says, with regard to property taken for a debt, “ must sell within three years unless allowed a longer time by the court.” Clearly the mandatory character of the second provision indicates the purely permissive character of the first; otherwise, there is no reason for it. Therefore the statute cannot be construed to mean that a corporation must immediately sell unutilized property, and cannot be permitted to lease it if the best judgment requires it. If it does, then such a corporation must always sell its property, with notice to the buyer that it cannot hold it for a better market without great loss, because it may not lease it.
    IV. The referee presumes the lease unnecessary, and refuses to allow evidence against the presumption. The referee excluded the question, “ Can you state any reason for the company’s ceasing to give entertainments in this particular hall ?” If the burden is with the plaintiff to show the facts justifying this special act, that question is clearly calculated to call out a fact showing it. The answer might have been, “ the hall is expensive, or ill adapted,” or “we determined to go elsewhere to another city.” Thus we are neither allowed to presume that the act is right, nor to take up the burden of showing that it is not wrong. Certainly, we must be allowed one or the other of these rights, or else the court must hold that under no circumstances whatever can a business corporation sublet property which it has hired by. mistake, if the judgment is to stand.
    V. Statutes like this have been repeatedly construed with liberality rather than hamper such corporations (Brown v. The Winisimet Co., 11 Allen, 326 ; Simpson v. The Westminster P. H. Co., H. L. C. 712 ; Barry v. The Merchants’ Ex., 1 Sandf. Ch. 280 ; Matter Howe, 1 Paige, 214 ; Old Colony R. R. v. Evans, 6 Gray, 25; Carpenter v. The B. H. G. M. Co., 65 N. Y. 48). The referee dismisses these cases with the remark that it appeared there that they were only “ temporary.” We submit this is a mistake. No case is cited forbidding a sub-lease under any or all circumstances.
    VII. The question of ultra vires, depending thus upon the fact whether the lease was necessary to the carrying of the plaintiff’s business, it is res adjudicata in the two actions where rent was recovered, for it appears by the findings that in one of those actions the defendants abandoned the possession of the premises before they put in their answer, and being out of possession, they were not prevented from pleading the defense of ultra vires. The issue of the validity of the lease was tendered to them on all grounds, and failing to take issue when they might have done so, they are precluded from questioning the validity of that judgment, and setting up any defense which calls in question the correctness of its conclusions. We find the rule as to former adjudication stated in the following cases (Mallory v. Horan, 49 N. Y. 11; Tuska v. O’Brien, 68 Ib. 446 ; White v. Merritt, 7 Ib. 352). A failure to set up a defense does not prevent its adjudication inferentially (Davis v. Talcott, 12 N. Y. 184). Further, even if they had not been out of possession, they still could have surrendered possession before pleading, so that their neglect to set up the defense was, in either case, voluntary.

      George L. Rives, attorney, and of counsel for respondent Abbey; A. J. Dittenhoefer, attorney, and of counsel for respondent Gilman, argued:
    I. The defendants are not concluded' by the judgments in actions 1 and 2 (Duchess of Kingston’s Case, 2 Smith's L. C. 784 ; Packet Co. v. Sickles, 9 Wall. 592 ; Aurora City v. West, 7 Wall. 106 ; Vaughan v. O’Brien, 39 How. Pr. 519 ; Palmer v. Hussey, 87 N. Y. 303 ; Dawley v. Brown, 79 Ib. 390 ; Masten v. Olcott, 22 Hun, 587 ; Goucher v. Clayton, 11 Jur. N. S. 107 ; Russell v. Place, 94 U. S. 606 ; Mason’s Executors v. Alston, 9 N. Y. 28 ; Campbell v. Butts, 3 Ib. 173; Davis v. Talcott, 12 Ib. 184 ; Campbell v. Consalus,
      25 Ib. 613 ; Burdick v. Post, 12 Barb. 168 ; 6 N. Y. 522 ; Ferguson v. Mass. Mutual Life Ins. Co., 22 Hun, 320 ; Schwinger v. Raymond, 83 N. Y. 192 ; Cromwell v. County of Sac, 94 U. S. 351; Hewlett v. Tarte, 10 C. B. [N. S.] 813 ; Stowell v. Chamberlain, 60 N. Y. 272; Van Alstyne v. I. P. & C. R. R. Co., 34 Barb. 28 ; Weed v. Burt, 78 N. Y. 191; Perry v. Dickinson, 85 Ib. 354). The cases of Ballenjie v. Cragin, 31 Barb. 534 ; Blair v. Bartlett, 75 N. Y. 150 ; Newton v. Hook, 48 Ib. 676 ; Embury v. Conner, 3 Ib. 511, 522 ; Jordan v. Van Eppes, 85 Ib. 427 ; Tysen v. Tompkins, 10 Daly, 244, commented on.
    The plaintiff’s counsel on the trial attempted to make a distinction, which does not seem to be based on any reported case, between defenses which do and defenses which do not involve the validity, of a contract. This theory appears to rest upon an entire misconception of the law of res adjudicata, and is distinctly contrary to the cases of Gfoucher v. Clayton, and Cromwell v. County of Sac, and has been repudiated by this court in Hughes v. Alexander (5 Duer, 488).
    II. The agreement of September 27, 1881, is ultra vires of the plaintiff corporation. It was so under its charter powers (Chap. 611, laws 1875, § 2, subd. 6 ; Ashbury Co. v. Riche, 7 H. L. 653; Thomas v. Railroad Co., 101 U. S. 71; Russell v. Topping, 5 McLean, 194 ; Pacific R. R. Co. v. Seeley, 5 Mo. 212). It is true that it has been frequently held that where a corporation possesses land or other property, and does not need the whole of such property in its business at any particular time, it may temporarily lease the property thus unemployed. It is in all such cases essential that the use so made should be merely temporary and strictly incidental to the principal business of the company (Brown v. Winimisset Co., 11 Allen, 326 ; Forrest v. Manchester, &c. Ry. Co., 30 Beav. 40 ; Simpson v. W. P. Hotel Co., 8 H. L. Cas. 712). This rule would apply to the case at bar if the lease in question had been of one room in the building or of the restaurant.

      The agreement was ultra vires under general rules of laws (Thomas v. Railroad Company, 101 U. S. 71; Black v. Del. & R. Canal Co., 22 N. J. Eq. 130 ; Atlantic & Pacific Co. v. Union Pac. Co., 1 McCrary Rep. 641; N. Y. Firemen’s Co. v. Ely, 5 Conn. 573 ; 1 Potter, Law Cor. 111, n. ; Ashbury R. R. Co. v. Riche, 7 H. L. 653 ; E. A. R. Co. v. E. C. R. Co., 11 C. B. 775 ; Pierce v. Madison & Ind. Co., 21 How. U. S. 441 ; Bank of Augusta v. Earl, 13 Pet. 519 ; Perrin v. Ches. Co., 9 How. U. S. 172 ; Hoagland v. Hannibal Co., 39 Mo. 441; Susquehanna & Penn. Co., 8 Gill & J. 248 ; Sumner v. Marcy, 3 Woodb. & Min. 105 ; Russell v. Topping, 5 McLean, 134 ; South Yorkshire Co. v. Great Southern Co., 9 Exch. 55 ; Bateman v. Ashton-under Lynn, 3 H. & N. 323 ; Norwich v. Norwalk Co., 4 El. & Bl. 397; Hawk v. Eastern Co., 1 De G. F. & J. 737; New Orleans Co. v. Ocean Co., 26 Am. R. 90; Pacific R. R. Co. v. Seeley, 45 Mo. 212 ; Copeland v. Citizens’ Gaslight Co., 61 Barb. 60 ; Adriance v. Rome, 52 Ib. 399 ; Brady v. Mayor, 16 How. 432 ; Frothingham v. McArdle, 6 Hun, 366 ; Taylor v. Earle, 8 Ib. 1; York Co. v. Winans, 17 How. [U. S.] 30 ; Abbot v. American Hard Rubber Co., 33 Barb. 578).
    Under section 1785 of the Code, which is simply a re-enactment of previous statutes, an action to procure a judgment dissolving a corporation and forfeiting its corporate rights and franchises may be maintained “where the corporation has suspended its ordinary and lawful business for at least one year.” Now, surely this company had no power to grant a lease of this hall for three years and do nothing during that period but collect the rent (Conro v. Port Henry Iron Company, 12 Barb. 27; Copeland v. Citizens’ Gas Light Company, 61 Barb. 60).
    ITT. These actions being for the recovery of rent for the unexecuted portion of the term, ultra vires is a defense (Green’s Brice’s Ultra Vires, 607 ; Thomas v. Railroad Co., 707 U. S. 71). In Woodruff v. Erie Railway Co. (25 Hun, 246 ; S. C., reversed, 93 N. Y. 609), the court of appeals held that defendants having had the use of the property during the whole of the time for which rent was demanded, was. estopped, at least so far as the contract had been executed, from setting up the defense of ultra vires; the court relying on the analogy of a tenant not being permitted to dispute the title of his landlord. To the same effect are Dinsmore v. A. & P. R. R. Co., 46 How. Pr. 193; President of Union Bridge Co. v. T. & L. R. R. Co., 7 Lans. 240; U. P. R. R. Co. v. W. U. Tel. Co., 1 McCrary, 551. As above stated, the court of appeals, in Woodruff v. Erie Railroad Co., suggest the analogy of the rule forbidding the tenant to dispute his landlord’s title. But that rule is certainly consistent with the position we assume, for it is well settled that the estoppel lasts only so long as the possession continues (Jackson v. Spear, 7 Wend. 400 ; Tompkins v. Snow, 63 Barb. 525 : Prevot v. Lawrence, 51 N. Y. 219 ; Territt v. Cowenhoven, 79 Ib. 400 ; Sedgwick & Wait’s Trial Title to Land, § 352).
    It seems to be well settled that when a tenant goes into possession under a lease void under the statute of frauds, he may move out, and cannot be held for rent, except for the time while he was in possession (Thomas v. Nelson, 69 N. Y. 118 ; Smith v. Genet, N. Y. Daily Reg. Nov. 10, 1884; Prial v. Entwistle, 10 Daly, 398).
    The foregoing cases not only establish the rule that the defendants can set up the defense of ultra vires in an action for the rent during the period while they were out of possession ; but they also settle it as the rule that the defendants cannot interpose that defense to an action brought to recover rent for the period while they were in possession. In other words,, that the defense of ultra vires is available in actions 4 and 6, but not in actions 1 and 2 (Woodruff v. Erie Railway Co., 93 N. Y. 609).
   By the Court.—O’Gorman, J.

These actions are two of a series of actions brought by the plaintiff - company against the defendants to recover rent for premises situated at the corner of Broadway and Forty-first street, in this city, known at the time, as the “ Metropolitan Concert Hall.”

Of these actions, two, numbered for convenience sake, 1 and 3, were brought to recover rent which accrued for the use and occupation of the premises by defendants, prior to January 31, 1882, under a lease made by the plaintiff to them on September 26, 1881. These two actions were tried, inquests taken, and judgments duly entered for the plaintiff, which judgments were sustained by the general term of this court and finally by the court of appeals, and were paid by the defendants, with interest and costs.

The two actions now at bar, numbered á and 6, were brought to recover rent claimed by plaintiff to be due it by defendants under the covenants of the said lease, for periods subsequent to January 31, 1882, during which periods the defendants did not use or occupy the premises, but had previously vacated and abandoned them. These actions were referred to a referee to hear and determine, who made his report, dismissing the complaints in both actions, and from the judgments entered on this report, appeals are taken.

There are but two material questions which need now to be discussed. The first question is whether the validity of the lease from the plaintiff company to the defendants was adjudicated, in the affirmative, in the first' actions, 1 and 3, so that defendants are now estopped from denying its validity. The second question is whether the referee, assuming that that question as to the validity of the lease was open for discussion, erred in holding as he did, that the lease was invalid.

The question of the validity of the lease was not adjudicated in the two first actions. It was not in issue in the pleadings, and if it had been pleaded by .the defendants, and in issue, it would not have been of any avail as a defense in those actions. Those actions were brought to recover rent for the use and occupation of the premises, during periods when the premises were m fact used and occupied by defendants, in execution of the contract of lease, and defendants were therefore estopped from questioning the power of the lessor to make the lease (Whitney Arms Co. v. Barlow, 63 N. Y. 62).

As to the second question, the referee held that neither by the law of its incorporation, nor by the general law of this state affecting business corporations, was any power vested in the plaintiff to lease the premises ; and that it did not appear that the lease was merely temporary and incident to the general business of the plaintiff, and on that ground he dismissed the complaints. He bases his opinion on section 2, subd. 6, chapter 611, laws of 18Í5, under which the plaintiff corporation was organized, by which it was empowered “to purchase, hold and possess so much real and personal estate as shall be necessary for the transaction of its business, and to sell and convey the same when not required for the uses of the corporation ;” and, also, on section 3 of 1 R. S. chap. IS, title 3, which provides, that in addition to the powers expressly given, “no corporation shall possess or exercise any corporate powers except such as shall be necessary to the exercise of the powers so enumerated and given.” The referee held that these provisions were exclusive, and operated as a prohibition of the exercise of other and distinct powers, of which he held the power to lease would be one.

The facts are briefly these : The plaintiff corporation was not the owner in fee of the premises leased by it to the defendants, but only the lessee, paying a ground rent therefor of $15,400 per annum, together with taxes, assessments, and water rents. The right of the plaintiff corporation to take and hold the premises under this lease was not questioned. The lease itself was not produced at the trial, and it did not appear for what term it was to continue. The plaintiff company occupied the premises as a concert hall, down to September, 1881, and have not given any concerts or musical entertainments there since October 31, 1881. On September 26, 1881, it executed a lease to the defendants, which is in evidence, whereby it leased the premises to them for a period of two months, commencing on October 1,-1881, at a rent of $2,500 per month, payable in advance, with a provision in the lease that the defendants should be entitled to an option, to be determined on or before November 1, 1881, of a further lease for the period of one year, commencing on December then next, at a rent of $600 per week, payable in advance, defendants to have a further option at the expiration of that period, for a further lease of two years at a weekly rent of $750 per week, payable in advance, thus giving to defendants the right to occupy and use the premises for a term of three years. The defendants entered into possession of the premises on October 1,1881, and made various alterations therein, to render them suitable to operatic or dramatic performances. The name was changed from “Metropolitan Concert Hall ” to the “ Casino.” Defendants, exercised the option to extend the lease for one year from December 1, 1881, at the rate of $600 per week, and occupied the premises until January 31, 1882, and have paid rent for the same. On that day, they vacated and abandoned the premises, and the present actions are brought to recover rent accruing, under the covenants of the lease to them for seven months subsequent to January 31, 1882.

Plaintiff did not own or possess any real or chattel property other than these premises, and, since making the lease to the defendants, plaintiff has practically ceased to perform any of the corporate functions provided for in its charter, and if it had been in its power, under the provisions of the lease to it, to sell the premises, or its interest therein as lessee, it would have been justified under the charter in doing so.

The lease to the plaintiff not having been produced, it cannot be presumed that it contained any provision prohibiting the sale of the lease, or requiring the consent of the lessor to such sale, or that any special reason existed, requiring the- execution of a sub-lease to the defendants in order to relieve the plaintiff from the continued payment of the annual rent provided for in that lease.

The referee held, that the possession of the premises was not a necessary incident to the continuing of the plaintiff’s business as provided for in its charter.

There is no evidence that the lease by plaintiff to defendants was necessary in order to carry out any corporate purpose, or for the execution of any corporate powers, or even to save the corporation from any pecuniary loss ; and it cannot be successfully contended that the plaintiff had, under the terms of their charter, any legal . power to lease the premises merely for the purpose of gain or profit to the corporation therefrom.

Unless then, the power to “ sell and convey ” clearly included a power to lease, the plaintiff’s lease of the premises was, at least in the absence of all proof of imperative necessity for the act, ultra vires and void.

The cases cited on the part of the plaintiff (Simpson v. Westminster, &c., H. L. 712, and Featherston Hough v. Lee Moore, H. L. 1 Eq. 318, 329), do not seem to me to apply to the case at bar. The facts in these cases showed necessity, justifying leases by the corporation, and it does not appear that there were provisions in their charters prohibiting their action.

If there were, in fact, any imperative necessity for plaintiff executing this sub-lease to the defendants, the burden of proving the existence of such necessity was on the plaintiff.

It is contended, on the part of the plaintiff, that the referee erred in excluding testimony as to the plaintiff’s reasons for ceasing to give entertainments in these premises. It is not apparent how any answer to that question could tend to relieve plaintiff from the difficulty of its case. In the face of the fact, that the plaintiff company had no other property, real or personal,—that it had not, since' October 1, 1881, given any musical entertainments anywhere, or, as far as appears, performed any legitimate act; and that its lease to the defendants of the only property the plaintiff possessed rendered its performance of any corporate act impossible—no evidence as to the reasons for ceasing to give entertainments in the premises in question could be material or relevant.

I am of opinion, that in the absence of sufficient proof, that unless by way of lease the plaintiff could not have disposed of the premises in question, the lease made by it to the defendants is illegal and void, and that as far as the plaintiff’s claims for rent in the present actions are concerned, the defendants cannot be held hable to pay rent thereunder.

The judgments should be affirmed, with costs.

Truax, J., concurred.


source: Caselaw Access Project

author: By the Court.—Ingraham, J.

license: Public Domain

text:
    WILLIAM JARVIS, Respondent, v. CHARLES BAXTER, et al., Appellants.

      Adjoining owners—rights and duties.—Private rmisanee—all concerned in liable.—■Circumstantial evidence, proof of facts from which it is permissible for the jury to find a resulting fact.

    Defendant Fenton was the owner of a lot, on which he caused a building to be erected. He was to furnish the material, defendant Baxter was architect and superintendent, and, as agent of Fenton, bought the materials that were used, and defendant Whalen was the mason and builder. By. reason of the inferior quality of the materials used in the building, and the improper and unsafe manner in which it was constructed, a large portion of the west wall fell on plaintiff’s house erected on the adjoining lot, and damaged it and the furniture therein. Held, that all the defendants were liable for the damage thus caused.
    Dunham, one of the witnesses, testified to finding in the plaintiff’s back yard, some mortar, which he produced; that it was picked up right by the side of the wall of the building which was on the lot of defendant Fenton, which wall extended beyond plaintiff’s rear wall; that he found brick and said mortar lying there; that it appeared as if a portion of the wall above had fallen. Held, competent, as the jury might find from it that the mortar came from the wall which fell.
    Before Sedgwick, Oh. J., Truax and Ingraham, JJ.

      Decided May 18, 1885.
    Appeal from judgment in favor of plaintiff entered on' verdict of jury.
    The facts appear in the opinion.

      Thomas Darlington, for appellants Fenton and Whalen, W. J. Birdsall, for Baxter.

      George W. Cotterell, for respondent.
   By the Court.—Ingraham, J.

The defendants were jointly engaged in the erection of a building—Whalen as mason and builder, Fenton as owner, and Baxter as architect and superintendent,—a portion of the west wall of which fell upon plaintiff’s house, erected on the adjoining lot, and caused damage, to recover which this action is brought.

There was evidence tending to show that the material used in the construction of the building was of an inferior quality, and that the building was constructed in an improper and unsafe maimer, and that in consequence of the use of such materials and such imperfect manner in which the building was erected, the building fell.

By the agreement between Fenton the owner, and Whalen, Fenton was to furnish the material required for the building, and the materials used were purchased by Baxter as agent for Fenton.

That the use of property in such a way as to cause an injury to property adjoining, is a private nuisance, and all who join in the erection or maintenance of such nuisance are liable for all injuries caused thereby, is well settled.

In Heeg v. Licht (80 N. Y. 579), a private nuisance is defined to be “ anything done to the hurt or annoyance to the lands, tenements and hereditaments of another. Any unwarrantable, unreasonable or unlawful use by a person of his own property, real or personal, to the injury of another, comes within this definition, and renders the owner or possessor liable for all damages arising from such use.” Building a house in such a way and of such poor material that it falls and injures the adjoining property, would, under this rule, be a private nuisance.

In Hay v. Cohoes Co. (2 N. Y. 159), it appeared that the defendant, in excavating a canal upon land of which defendant was the owner, caused a large quantity of earth and rock to fall upon plaintiff’s land, which caused damage, and in holding it hable, the court said, u a man may prosecute such business as he chooses upon his premises, but he cannot erect a nuisance to the annoyance of the adjoining proprietor, even for the purpose of a lawful trade. He may excavate a canal, but he cannot cast the dirt and stones upon the land of his neighbor either by human agency or the force of gunpowder. If he cannot construct the work without the adoption of such means, he must abandon that mode of using his property, dr be held responsible for all damages resulting therefrom.” And in Tremain v. Cohoes Co. (2 N. Y. 163), the court held that the evidence offered by the defendant to prove that the work was done in the best and most careful manner, was irrelevant and of no consequence.

The court left it to the jury to say whether or not the defendants built the house as required by the building law, and the jury by their verdict have found that they did not, and that the injury was caused by the failure of the defendants to so construct the buildings.

It is well settled that the creator of a nuisance, or one who more remotely, either by negligence or design, furnishes the means and facilities for the commission of any injury to another which could not have been done without them, is equally responsible with the actual wrongdoer (Anderson v. Dickie, 26 How. 105).

I am of opinion that Dunham’s testimony- as to finding the mortar in the back-yard of the plaintiff was competent. The facts he stated' would have permitted the jury to find that the mortar was picked from a place where it would likely be dropped from the wall as it fell, there being no evidence that would otherwise account for it being in the back-yard, as the jury might find. The mortar in the state in which it was found, would enable a jury by the aid of witnesses to say what had been its constituents from the first. If Dunham said that there had been not sufficient lime in it in the beginning, there was no uncontrovertible evidence, that even if a great deal had been washed out, it was impossible for an expert to calculate how much there had been at first.

The defendant Fenton gave such an account of his relation to Baxter, that it, coupled with other facts in the case, shows that neither could have been harmed by pressing an inquiry as to whether they occupied the same office.

I think the judgment should be affirmed, with costs.

Sedgwick, Oh. J., concurred; Truax, J., dissented.


author: By the Court. —Ingraham, J. O’Gorman, J.—[Dissenting.]

text:
    LAWRENCE J. CALLANAN, et al., Respondents, v. GEORGE F. GILMAN, Appellant.

      Side-wallc—obstruction of, substantially continuous—public nuisance.—Special damage—slight evidence of, will sustain injunction against, at suit of private citizen. — Order not appealable under § 1316 Oode, by including in notice of appeal from judgment.

    A plankway forming a continuous bridge across a sidewalk and totally obstructing it during a greater part of every business day, is a public nuisance.
    A private citizen may have an injunction against such a nuisance on showing special damage.
    But slight evidence of special damage will uphold a judgment for an injunction against such a nuisance.
    In such a case," an injunction against obstructing, by any plankway or bridge, or the like, extending across the sidewalk and elevated above, and against hindering the plaintiffs, their employees and customers from having free use and passage along the sidewalk in front of defendant’s premises, is not too broad.
    An order made in an action tried before a judge without a jury, after the filing of his decision, denying a motion, made after such filing, to amend the answer, does not affect the final judgment, and is, therefore, not appealable under § 1316.
    Semble, the proposed amendment being to remedy a supposed defect in the denials, and both parties on the trial having, on the trial, treated the denials as sufficient, an amendment was unnecessary.
    Before Sedgwick, Oh. J., O’Gorman and Ingraham, JJ.

      Decided May 18, 1885.
    Appeal from judgment awarding the plaintiffs an injunction.
    Plaintiffs’ evidence as to the special damages suffered by them from the nuisance, enjoined, in addition to that referred to in the opinion of Judge O’Gorman, was as follows : One of the plaintiffs testified, “We think a great portion of our customers come to our store from Broadway along the southerly side of Vesey street. I have seen the effect of this bridge on pedestrians. The effect has been to stop them, and it is my strong impression that it drives a good many of them to the other side of the street. It has prevented our customers coming to the store. Mr. Hanshaw ” (whose evidence is referred to by Judge O’Gorman) “ and his partner. If I thought it necessary I could name several. I have not been able to transact my business with the same convenience to myself and my employees since this obstruction as I did before. I complained to Captain Berghold of this obstruction, because it was a decided detriment to my business, and is in my opinion, a decided loss to all owners of property on the street, and a detriment to the business interests of the street. The injury to me was great. I cannot tell whether my business increased or decreased between July 9, 1883, and August 13, 1883. There is no question at all but that travel has been diverted by the use- of this bridge.” Another of the plaintiffs testified, “ The effect of this obstruction on pedestrians is very bad. We have had numerous complaints from our customers as to its being a positive obstruction. It is an obstruction across the sidewalk, and quite a number of our customers come down the other side of the street rather than go over the obstruction. I cannot, at this moment, name any customers who complained of this plank.” There was considerable evidence to the effect that travel was diverted by reason of the bridge.
    The original answer denied each allegation of the complaint “except those thereinafter admitted, qualified or explained.” After the filing of the decision of the' judge, defendant moved to amend the answer so as to deny, in the mode required by the Code, certain of the allegations of the complaint, the evidence as to which, on both sides, had been fully heard on the trial. The motion was denied.
    Other facts appear in the opinion.

      Abbett & Fuller, attorneys, and of counsel for appellant, on the questions considered in the opinions, argued :
    I. The plaintiffs failed to establish that defendant was maintaining a public nuisance, (a) The bridge was a temporary and partial obstruction necessitated by business, and was not unlawful in itself; and, therefore, not a public nuisance (Wood on Nuisances, § 259, and cases cited, § 801; People v. Cunningham, 1 Den. 524). There is a very substantial distinction between encroachments amounting to a purpresture, and a temporary and partial obstruction necessitated by the business of the community. And this distinction is well shown by such cases as Knox v. Mayor (55 Barb. 404); Trenor v. Jackson (46 How. 389); Ely, Mayor, v. Campbell (59 How. Pr. 333); Lawrence v. Mayor (2 Barb. 577); Howard v. Robbins (1 Lans. 63); Alb. L. J. vol. 20, p. 183. This bridge is used by authority of the board of aldermen (Corporation Ord., rev. 1880, p. 138, § 21 ; p. 223, § 285). The legislature has conferred upon the city government the power to decide •what is a reasonable and proper use of the streets. Acts may be authorized by such government which, without its authority, might be prohibited. This is required by public necessity. Thus, it is well settled that “ the legislative authority is competent to declare the uses to which highways may be appropriated, and to impart to municipal corporations both permissive and restraining powers over the subject matter. If neither the constitution nor the laws have been transcended in a given case, no individual can sustain a suit against a party exercising a right by competent authority. The aid of an injunction cannot be invoked to prevent, nor will an action lie to redress, consequential injuries necessarily resulting from the lawful exercise of a right granted by the sovereign power of a state, or conferred by competent municipal authority ” (Williams v. N. Y. Central R. R. Co., 18 Barb. 232). The reversal of this case upon appeal (16 N. Y. 111), was upon the ground that no lawful right had been given, and that equity might be invoked to prevent a multiplicity of suits. Broad as are the powers of courts of equity, they cannot interfere with the fair exercise of discretion lawfully given to the city government (Leigh v. Westervelt, 2 Duer, 618 ; High Injunctions, § 767 [2ed.], and cases cited; People ex rel. Murphy v. Kelley, 76 N. Y. 475). A public nuisance must be occasioned by acts done in violation of law. A work which is authorized by law cannot be a nuisance (Hinchman v. Paterson Horse R. R. Co., 17 N. J. Eq. 77 ; Bordentown & S. Amboy Turnpike Co. v. Camden & Amboy R. R. Co., 2 Harr. 314 ; Davis v. Mayor, 14 N. Y. 506 ; Wood on Nuisances, §§ 746, 750, and cases cited ; also § 753 ; Hatch v. Vermont Central R. R. Co., 25 Vt. 67). The Penal Code (§ 385, subd. 3), preserves this distinction. The argument of the plaintiffs and opinion of the judge at special term are based upon a conception of the purposes and uses of streets in this city, which, we respectfully submit, is erroneous. It is a well known fact, and one shown by the evidence in this case, that this city is built in a rather unscientific way, and the streets are not mere passage ways, but may more fitly be called the arteries, through which the trade and travel, which are the blood of commercial cities, are designed to flow. Propositions, which were true generations ago, when applied to a provincial city of England, are not true now of New York city with its large population, cramped by the form of the wedge on which it is built. The streets have been • laid out and may be used for all the purposes of communication, loading and receiving goods, and the necessary transaction of the immense business of a great mercantile centre. They are not solely to walk over, and the rights of pedestrians to the sidewalk are not so absolute but that they must give way to public necessity or convenience, especially when there is provided a convenient and proper passageway over the adjoining vault lights, which are very slightly elevated and five feet wide. How much less incovenience than if the defendant backed his cart across the walk, as he might properly do. In Matthews v. Kelsey (58 Me. 56), this question is discussed, and it is there held, that for tho purpose of unloading a car of flour, a merchant whose store is on the street may use skids tern-porarily elevated above the ground, and extending from the car door fifty feet from the store, provided there is ample room between the car and the opposite side of the street to accommodate the travel of the street.
    II. But even if the plank did constitute a public nuisance, the plaintiffs did not suffer special damage from its maintenance. “No person can maintain an action for damages from a common nuisance where the injury and damages are common to all” (Wood on Nuisances, § 618 ; 1 Coke’s Inst. 56, note- a). Mere obstruction is not sufficient (Wood on Nuisances, § 632 ; Baxter v. Winooski Turnpike Co., 22 Vt. 114; Hutchinson v. Railroad Co., 28 Ib. 142 ; Iveson v. Moore, Id. Raym. 486 ; Rose v. Miles, 4 M. & S. 101; Greasley v. Codling, 2 Bing. 263). The damage “ must be of a different character, special and apart from that which the public in general sustain, and not such as is common to every person who exercises the right that is injured.” “ It is not enough that he has sustained more damage ” (Wood on Nuisances, § 619, and cases cited; Pierce v. Dart, 7 Cow. 609 ; Doolittle v. Supervisors of Broome Co., 18 N. Y. 155 ; McGowan v. White-sides, 31 Ind.; 2 Alb. L. J. 32). It will not suffice that ■the person complaining merely showed a violation of his rights. He must show such a violation as is or will be attended by serious damage (Bigelow v. Hartford Bridge Co., 11 Conn. 565 ; Pen. Code, §§ 385, 386). The proper measure of damages (for maintaining a nuisance) is the difference between the rental value, free from the effects of the nuisance for which damages were claimed and subject to it (Jutte v. Hughes, 67 N. Y. 271; Francis v. Schoellkopf, 53 Ib. 152 ; Knox v. Mayor, &c., 55 Barb. 404). The plaintiffs themselves testify that there has been no decrease of rental, or in the value of property in the neighborhood. Hot one witness gives the faintest intimation of a contrary opinion. Evidence of special damages, other than these, was inadmissible, and proper exception was duly taken by defendant at the trial. This evidence should have been excluded, and plaintiffs’ case is then bare of any evidence of special damage (Bliss’ Code, 293, notes l, m, n, p, r and t; Green v. N. Y. C. & H. R. R., 12 Abb. N. S. 124; Hallock v. Miller, 2 Barb. 630 ; Tobias v. Harland, 4 Wend. 537 ; Havemeyer v. Fuller, 60 How. Pr. 322 ; Bergman v. Jones, 94 N. Y. 51). Even with this evidence, however, the only proof of loss is the temporary loss of one customer, who has returned and still trades with plaintiffs. That customer bought goods also of other grocers while the injunction was in force, and plaintiffs fail to show any difference in amount of business by reason of the alleged obstruction.
    III. The court could not, in this action, grant the relief prayed for and set forth in the judgment, (a.) If a private action could be maintained, it should have been an action of nuisance, not a suit for injunction. The legislature has provided a complete remedy by the action of a nuisance (§§ 1660-1663, Code of Civ. Proc.), and therefore a court of equity should refuse to entertain an action to enjoin and abate such a nuisance (Remington v. Foster, 42 Wis. 608). (6.) Again, “If the injury is trifling, send the nuisance temporary, and the party has an adequate remedy at law, the courts will sometimes refuse to interfere, when the inconvenience and damage resulting to the defendant will be greater by its interference than the injury to the plaintiff will be if the remedy is denied (Wood on Nuisances, § 199, and cases cited). Under the principles of the following authorities, the action is not sustainable (Parker v. Winnepiseoggee L. C. & W. Co., 2 Black, 545 ; Hamilton v. N. Y. & Harlem R. R. Co., 9 Paige Ch. 173 ; Bliss’ Code [2 ed.] 543, § 629, notes n, o, p, q, r, s; Wood on Nuisances, 817, note §§ 778, 780, 785 ; Child v. Douglas, 5 D. M. & G. 741 ; Story’s Equity [12 ed.] § 924, and cases cited ; High on-Injunctions [2d ed.], § 844, and §§ 761-768 and cases cited; Higbee v. Camden & Amboy R. R. Co., 20 N. J. 435). Unless the equities are clearly established, a court of equity should not interfere until after a trial and verdict by the jury. Whether a particular use is an unreasonable use and a nuisance, is a question of fact to be judged of from the circumstances of each case by the jury (Wood on Nuisances, § 251 ; Wetmore v. Tracy, 14 Wend. 250 ; Com. v. King, 13 Metc. (Mass.] 115 ; Harlow v. State, 1 Iowa, 439 ; Angel on Highways, 206 ; Ladie v. Arnold, 1 Salk. 168 ; Harrower v. Ritson, 31 Barb. 301 ; 1 Hawk. P. C. 76, §§ 48-60; James v. Hayward, Cro. Car. 184; Rogers v. Rogers, 14 Wend. 131). Thus, the Code provides that actions for a nuisance shall be tried by a jury (Code Civ. Proc. § 968 ; Hudson v. Caryl, 44 N. Y. 553). Equity will refuse to interfere where a summary remedy is provided for abatement by municipal authorities of all nuisances (Powell v. Foster, 59 Ga. 190).
    IV. The motion to amend the answer nunc pro tunc should have been granted (§ 123 Code Civ. Proc ; Lounsbury v. Purdy, 18 N. Y. 515 ; Burley, Recr. v. German American Bank, 111 U. S. R. 216 ; Hatch v. Central National Bank, 78 N. Y. 487). The object of the provision is that the pleadings may, by such amendment, show the questions that were actually litigated. And the amendment accomplishes in form what the appellate court will do even without such formal correction (McKenzie v. Ward, 58 N. Y. 541 ; Tisdale v. Morgan, 7 Hun, 585).
    Y. The order may be reviewed on this appeal (§§ 1301-1316, Code Civ. Proc.)

      Edwin M. Wight, attorney, and of counsel for respondents, argued:
    I. The law of this case was well stated by the trial judge in his opinion, in which he cited : Luce v. Alexander, 49 Sup. Ct. 202 ; Clark v. Dillon, 4 N. Y. Civ. Pro. 245; Davis v. The Mayor, &c., 14 N. Y. 506 ; Tremor v. Jackson, 15 Abb. N. S. 115 ; Ely v. Campbell, 59 How. 333 ; People v. Mayor, 59 Ib. 277; People v. Mayor, Daily Reg. April 23, 1884 ; Metropolitan Tel. Co. v. Colwell Lead Co., Daily Reg. Aug. 13, 1884. In addition to those cases, see also Hart v. Mayor, 9 Wend. 571; People v. Cunningham, 1 Den. 524; Knox v. Mayor, 55 Barb. 405 ; People v. Kerr, 27 N. Y. 188 ; Moore v. Jackson, 2 Abb. N. C. 211; Greene v. N. Y. C. & H. H. R., 12 Ib. 124; Com. v. Passmore, 1 Serg. & R. 219; Rex v. Jones, 3 Camp. 230 ; Wood on Nuisances, ch. 25 ; Tuttle v. Brush, &c. Co., 50 Super. Ct. 464; Hallock v. Baranski, Daily Reg. Aug. 9, 1884 ; Tiffany v. U. S. Illuminating Co., Daily Reg. April 9, 1884.
    II. Any person injuriously affected by a public nuisance may maintain an action to restrain it (Knox v. Mayor, 55 Barb. 405).
    III. The bridge in question constitutes a nuisance, public and private {Wood on Nuisances, % 259). It is doubtful if equity will sanction in a great public thoroughfare, the carrying on of a business differing wholly in character from its immediate surroundings, so as to greatly inconvenience such surroundings, even when the business is conducted with the most scrupulous regard for the rights of others consistent with such business (Heeg v. Licht, 80 N. Y. 579, and cases cited); but, when, as in this case, defendant brings into a retail business street a depot of distribution for about 130 stores in various parts of the country, requiring, by its very nature, much moving of goods to and from wagons in the street, and, instead of doing that business in a way to obstruct the sidewalk as little as possible, bridges the same, necessarily obstructing it entirely, and maintains such bridge, as in this case, he is without any shadow of excuse, and the court will restrain the maintenance of such a structure.
    IV. The motion to dismiss the appeal from the order-denying the motion to amend the answer should be granted under the provisions of section 1316, limiting the class of orders which are brought up for review by an appeal from a final judgment. They must “ necessarily affect the final judgment ” (Hunt v. Chapman, 62 N. Y. 333 ; Thurber v. H. B. M. & F. R. R. Co., 60 Ib. 326).
   By the Court. —Ingraham, J.

The court below found, as matter of fact, that plaintiff' Callanan is the owner; and that the plaintiffs as copartners are the lessees of the premises No. 41 Vesey street, and that plaintiffs and their predecessors in business have carried on business as wholesale and retail grocers, at such place, for upwards of forty yearsthat defendant has constructed and maintained, during a considerable portion of the business hours of each day, in front of the building occupied by him, Nos. 35 and 37 Vesey street, a plankway or bridge, one end resting on the stoop of the building occupied by defendant, and the other .end resting on a wooden horse or rest in the roadway of Vesey street, thus forming a continuous bridge from said stoop to the roadway of the street, over and across the sidewalk; that said bridge forms an obstruction to the sidewalk of said Vesey street, during a greater part of every business day; that said obstruction is a special injury and damage to the plaintiffs, and that they have lost custom by reason of its maintenance ; that the injury to the plaintiffs caused thereby is great and cannot be adequately compensated for in money, and is incapable of exact measurement in damages, and that plaintiffs have no adequate remedy at law therefor ; and as conclusion of law, that plaintiffs are entitled to an injunction enjoining the defendant from ■obstructing the sidewalk by such plankway or bridge.

The evidence of the special damage is slight, but after a careful examination of the case, we think there is sufficient to sustain the findings.

In Milhau v. Sharp (27 N. Y. 625), the court of appeals said : “ It is insisted by defendants5 counsel that the findings of the judge at special term show that the injury complained of was a public and not a private nuisance, and that consequently a private action to prevent or restrain it could not be maintained. It is not an available objection, to actions of this nature, that the wrong complained of constitutes a public nuisance, provided the plaintiffs are subjected by it to any special injury not common to the public or to large classes of people,55 and cites with approval from 2 Story’s Equity, § 925: There must be such an injury as from its nature is not susceptible of being adequately compensated by damages at law, or such as from its continuance or permanent mischief, must occasion a constantly recurring grievance which cannot be otherwise prevented but by injunction.55

Under this rule, the judgment was the necessary result of the findings of fact, and as the findings of fact cannot be disturbed, the plaintiff was entitled to the judgment, and the judgment appealed from must be affirmed, with costs.

The defendant also seeks to review an order of the special term made on the 15th day of October, 1881, denying the motion of the defendant to amend the answer. The motion was made and the order sought to be reviewed was entered after the decision of the judge, before whom the action was tried, was filed. Uo separate appeal to the general term from this order is taken, and the order was not one which can be reviewed under section 1316 of the Code, on the appeal taken from a final judgment. The motion was one addressed to the discretion of the court, and did not affect the final judgment.

We think, however, that the motion was unnecessary. On the trial of the action, it was not claimed by plaintiffs that the denial in the answer was insufficient. The plaintiffs undertook the burden of proving the obstruction in the street and the special damage. The court received the evidence offered by the defendant to overcome plaintiffs’ evidence to sustain such allegations.

Under such circumstances, we think that neither of the parties could claim that the answer was insufficient, but as before stated, the order is not before us for review.

The judgment should be affirmed, with costs.

Sedgwick, Oh. J., concurred.

O’Gorman, J.—[Dissenting.]

This is an appeal from a judgment restraining the defendant from obstructing the southerly side of Vesey street in front of his premises (Nos. 35 and 31), by any plankway or bridge, or other like obstruction, elevated above the sidewalk and reaching from said premises or from the stoop in front thereof to the roadway, or from hindering the plaintiffs or their employees and customers from having free use and passage along the sidewalk in front of defendant’s said premises.

The action was tried at special term, without a jury. The plaintiffs, in their complaint, did not ask any judgment or relief, by way of damages, but only for an injunction.

They alleged that the obstruction complained of was a public nuisance, but of special injury to the plaintiffs and their business ; that the injury was great and irreparable, incapable of exact measurement in damages, and could not be adequately compensated in money, and that actions for each renewal of the nuisance would cause a multiplicity of litigation. No evidence was given on the part of the plaintiffs, from which any adequate or reasonable measure of damages could be ascertained, or which would have warranted a verdict for more than nominal damages, if the action had been brought to recover damages.

The material facts, as they appeared in evidence, are these : The plaintiffs, before December, 1882, and at the time of bringing this action, occupied premises on the south side of Vesey street, and used them in their business of wholesale and retail grocers. Their premises were one hundred and twenty-five feet west of the corner of Church street and Vesey street. The defendant also occupied premises on the south side of Vesey street, and used them in the same business of wholesale and retail grocer. His premises were on the corner of Church street, and had a frontage on Church street, as well as a frontage on Vesey street, and were to the east of the premises of the plaintiffs. About December 1882, the defendant commenced to use, in loading and unloading his goods, a plank skid or bridge, about three feet wide, starting from about eighteen inches inside his stoop fine, and extending thence over the sidewalk to a wooden horse or rest (such as masons use), at the curb, where it rested near the end of his trucks. This skid was about twelve inches above the sidewalk at the stoop line, and about two feet six inches at the curb. On the stoop in front of defendant’s premises, between the point where the skid rested and the house front, there was left a space, which might be used by pedestrians, of about five feet. This bridge was used by the defendant continuously during the greater part of every business day, and there is evidence to sustain the finding of the trial judge, that there "was no necessity for such use of the bridge by the defendant. On this subject there was considerable conflict of testimony. There was enough of evidence, however, to sustain the conclusion that this continuous use of this bridge by the defendant seriously impeded pedestrians in passing to and fro along this street, and, for a considerable period in each business day, obstructed the sidewalk and created a public nuisance, for abatement of which, action would he on behalf of the people of this state.

In Green v. R. R. (12 Abb. N. C. 143), the learned trial judge says : “ It is well settled law that the conduct of any business, intrinsically lawful, may give rise to a cause of action, if, under ah the circumstances, it occasions an unreasonable encroachment on the public highway. Thus, in Rex v. Jones (3 Camp. 230), Lord Ellenborough said, c A' cart or wagon may be unloaded at a gateway, but this must be done with promptness. The defendant is not to eke out the inconvenience of his own premises by taking the public highway into his timber yard; and if the street be too narrow he must move to a more commodious situation for carrying on his business.’ In the King v. Russel (6 East, 426), it was held that if the nature of the defendant’s business were such as to require the loading and unloading of so many more wagons than could be done conveniently within his own private premises, he must either enlarge his premises or move his business to a more convenient spot ; that the primary object of the street was for free passage of the public, and anything .■ which impeded that free passage was a nuisance. And in Moore v. Jackson (2 Abb. N. C. 211), it was held that a systematic and continued encroachment on a highway, though for the purpose of carrying on a lawful business, is unjustifiable.” The public are entitled to an unobstructed passage upon the streets, including the sidewalks of the city (Clifford v. Dam, 81 N. Y. 52). The law of the public street is motion. A mere temporary occupation of a part of a highway, however, by persons engaged in receiving or defivering goods from stores or the like, is allowed from the necessity of the case, but a systematic and continued encroachment on a highway, though for the purpose of carrying on a lawful business, is unjustifiable (Moore v. Jackson, 2 Abb. N. C. 211, 214). A temporary and necessary use, such as the delivery of barrels from wagons on skids across a sidewalk, is permissible, if sufficient space is left on the other side of the roadway (Matthews v. Kelsey, 58 Maine, 56). The public nuisance, therefore, in the case at bar, does not arise from an obstruction to the sidewalk by reason of its use for an unlawful purpose, but by reason of its excessive, continuous and unnecessary use for a lawful purpose.

So much as to the relations and rights of the public at large, as against obstructions, and in the abatement thereof.

This action, however, is not brought on behalf of the public for the abatement of a public nuisance, or even on behalf of numerous property owners, or business interests in Vesey street, but only by the plaintiffs as private individuals, on their own behalf, and because of a special injury and damage to them, different from the damage inflicted on the public, and as to which special damage the public have no interest or concern.

The trial judge has found that the plaintiffs have lost custom by reason of the maintenance of this bridge by the defendant. The evidence—and the only specific evidence on that subject—is that given by a witness, who stated that he was the publisher of a newspaper—had an office at 30 Vesey street, at corner of Church street, for nearly three years—he generally bought his groceries down town, mostly at plaintiffs’ and Bennet’s, also at Stiner’s, and perhaps at other places,—quite a number of times,, he found the street blocked up with this bridge, and it caused him to go to the other side of the street—he did not care to go into the street when it was muddy—bought probably four-fifths of his groceries from plaintiffs—does not think he bought quite that proportion now. There is no evidence, on the part of the plaintiffs, of the quantity or value of the groceries which the witness had been in the habit of buying from them, before the use of this skid by the defendant, or the extent of the decrease in amount or value of his purchases afterwards, or any evidence whatever of any specific loss, on which any but nominal damages could be awarded. There was no attempt to prove

diminution of the rental value of plaintiffs’ premises, which was a measure of damages adopted in Francis v. Schoellkopf (58 N. Y. 154); Green v. R. R. (supra, 146). Thus, the question of damages which plaintiffs have heretofore incurred, has been left wholly speculative, and there is no evidence that any injury could be reasonably anticipated or feared by the plaintiffs, by reason of the continuance of the use of this skid by the defendant, other or greater than that to which plaintiffs had been theretofore subjected.

As has been before stated, the alleged nuisance here complained of, does not arise from any trespass on, or abuse of the sidewalk for any purpose, in itself noxious or unlawful, but from an unnecessary,- continuous, and excessively prolonged use of the sidewalk for a purpose, in itself legitimate and proper. In such cases, courts of equity have been slow to interfere and reluctant to apply the remedy of injunction. It was said by an eminent judge, “that no instance could be found of the interposition by injunction where the nuisance could be regarded as only eventual and contingent ” (2 Story Eq. J. § 924 and note). “A court,” says Agnew, J., in Huckinstine’s Appeal (Á) Penn. 81, 102), “whose arm may fall with crushing force on the every-day business of men, destroying lawful means of support, cannot approach such cases with too much caution.” Indeed, there cannot be a jurisdiction exercised by a court of equity, demanding more delicacy in its use.

It is clear, that unless plaintiffs have proved some special, substantial, and appreciable damage, other than that sustained by the people at large, they are not entitled to an injunction. And I am unable to see why there should have been any difficulty in proving the damages, if any there were, which have been inflicted on the plaintiffs. There is no foundation for an injunction on the ground that any injury other or greater than what has occurred in the past, would occur in the future, or any injury that could be in its nature irreparable, that is to say, irreparable, not because it would be so small that it could not be estimated, but because it was likely to be so great, that it would be incapable of compensation in damages.

Entertaining these views, I am not satisfied that the plaintiffs have proved facts, entitling them to the exercise of the extraordinary powers of a court of equity in their behalf. If the special injury which they complain of, be not susceptible of exact measurement in damages, it is not easy to avoid the suspicion that it was an injury too inconsiderable, and insignificant to warrant any serious apprehension of its recurrence in the future, or any claim on this court for protection against it. In cases of this kind, the doubt will naturally suggest itself, whether the court in consenting to protect the plaintiffs from an uncertain and exaggerated danger, may not be the means of inflicting on the defendant a real and substantial injury.

There is still another objection to the scope and form of the judgment, which is, I think important. The injury done to the plaintiffs, if any, arises not from the use of the bridge by the defendant, because the use, within proper limits as to time, and for a proper purpose, would have been unobjectionable. The bridge became objectionable, from its abuse, by keeping it up continuously and for periods of time too protracted, and when its use was not necessary to the defendant’s business. The judgment rendered made no distinction in this regard, but restrained the defendant absolutely, and without any limit as to the time or occasion.

This was, I think, a judgment larger in its scope;and operation, than the plaintiffs were entitled to, in any aspect of this case, and would have the effect of restraining the defendant, not only from the unnecessary, continuous, and unlawful use of this bridge, but from the occasional and proper use of it, as a necessary means of carrying on his business, not ■ in itself unlawful, and against which, neither the public, nor the plaintiffs could have any legitimate cause of complaint.

For these reasons, I am of the opinion that the judgment should be reversed, with costs, and that a new trial be ordered.


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

text:
    THE AMERICAN TELEGRAPH & CABLE CO., Respondent, v. HENRY DAY, Impleaded, Appellant, and BYRON G. De WOLF and S. H. SWAN, Respondents, et al.

      Action of interpleader, or in that nature.—Bill of peace.—Multiplicity of actions.•—Stock certificate, acceptance of.\ surrender, and issue of new on forged powers—injunction as to.

    Where the perplexity and danger upon which the plaintiff founds his action of interpleader, or one in that nature, arises out of an act done voluntarily and advisedly hy him, it does not arise without his fault, and the action will not lie.
    One charged witli a tort in the conversion of property cannot interplead the party making the charge with others claiming adversely to him, under whom the party charged acted.
    Multiplicity of actions will not, of itself, constitute an equity on which to found an equitable action. The anticipated issues between the plaintiff in the equity action and the various defendants thereto must be ad idem.

    The plaintiff accepted the surrender of certain certificates of its stock, and issued new ones upon alleged forged powers of attorney, and the owner of the surrendered certificates brought an action against it, praying that the surrendered certificates or others of the same form and tenor be delivered to him, and all dividends earned be paid to him, and that he be adjudged the owner of the shares represented by the surrendered certificates, and that the company be adjudged to recognize him as such owner; thereupon, the plaintiff commenced an action against him, and the persons who procured, and those who then held certificates for the stock which had been before represented by the surrendered certificates, praying, among other things, for an injunction against such owner prosecuting his action, and against the other defendants commencing any action against it based upon claims of ownership of the stock which had been represented by the surrendered certificates, or of dividends declared thereon. An injunction order in conformity with this prayer was granted.

      Held, under the foregoing principles, that plaintiff was not entitled to the injunction.

      Before Sedgwick, Oh. J., O’Gorman and Ingraham, JJ.

      Decided May 25, 1885.
    Appeal from order denying a motion to vacate an injunction.
    Mr. Day, the appellant, was the owner of seven hundred shares of the plaintiff’s capital stock, represented by seven certificates, each for one hundred shares, standing in his name and transferable on the plaintiff’s books by Mr. Day or his attorney, on the surrender of the certificates. The complaint alleges that the certificates were, between April 25, 1883, and October 30, 1883, surrendered to the plaintiff, with powers of attorney indorsed purporting to be executed by Mr. Day, authorizing the transfer of the stock on the plaintiff’s books, and that in accordance therewith the stock was transferred by it. Mr. Day alleges that the certificates were wrongfully taken from his possession ; that his signatures to the powers of attorney were forgeries ; that he never transferred or authorized the transfer of the stock; and that any attempted transfer was fraudulent as to him. To compel the plaintiff to recognize him as the owner of his stock, Mr. Day sued the plaintiff in this court, praying as stated in the head-note. After the action became at issue, the plaintiff moved, at special term, to compel Mr. Day to join as parties, certain persons to whom it claimed that it had issued stock upon the forged powers of attorney. The court denied the motion upon the ground that such parties were neither interested in nor parties to the controversy between the plaintiff and Mr. Day.
    Thereupon the plaintiff brought this action, joining as defendants—(1) Mr. Day; (2) -The firms of Denslow, Easton & Herts and De Wolf & Swan, as to whom the complaint alleges that they presented Mr. Day’s certificatest with the forged powers of attorney, to the plaintiff, certified to the genuineness of Mr. Day’s signatures, and demanded new certificates; (3) Henry W. Putnam,. Thomas Emory’s Sons, George D. Patten, Jr., Work, Strong & Co., William Whitewright and John B. Gale, who now hold certificates for the stock which the plaintiff alleges that it issued in place of Mr. Day’s certificates ; and asking that Mr. Day be compelled to litigate his claim to his seven hundred shares in this action; that it be determined as between him and the other defendants, who has the right to the possession of the certificates for the shares ; that the claims of the other defendants to the shares, and to the certificates issued therefor, and to the dividends on the shares, may be litigated in this action ; and that Mr. Day may be enjoined from prosecuting the action commenced by him ; and that all the defendants be enjoined from commencing any action against the plaintiff based upon claims of ownership of the said shares or dividends declared or earned thereon. The complaint further asked that, if Mr. Day were adjudged to be entitled to his stock, the defendants holding new certificates might be compelled to deliver them up, or to account to Mr. Day or to the plaintiff for the value, etc.
    Upon the complaint and an affidavit of general verification, plaintiff obtained an injunctive order, in conformity with the prayer of the complaint. Mr. Day thereupon moved to dissolve the injunction, which motion was denied, and an order made accordingly, from which this appeal is taken.

      Franklin B. Lord, attorney, and John E. Parsons, of counsel for appellant Day, argued:
    I. If Mr. Day establishes in' his action that he is the owner of his stock ; that it has never been transferred by him or by his authority ; and that the powers of attorney upon which the plaintiff issued new certificates, were forgeries,—he is entitled to judgment in his favor, compelling the plaintiff to recog-' nize him as a stockholder with all the rights belonging to him as such (Pollock v. National Bank, 7 N. Y. 274 ; Telegraph Co. v. Davenport, 97 U. S. 369 ; Pratt v. Taunton Copper Co., 123 Mass. 110 ; Midland Railway v. Taylor, 8
      H. L. Cas. 751). This is none the less so that the plaintiff has, upon the forged powers of attorney, issued new certificates (cases supra). Mr. Day’s certificates are in possession of the plaintiff. It holds them as Mr. Day’s property. If Mr. Day’s certificates were outstanding in the hands of a third person, who, as against the plaintiff, claimed to own them, that person would be a proper, if not a necessary party, to Mr. Day’s action against the plaintiff (Cottam v. Eastern Counties R’y Co., 1 Johns. & Hem. 243 ; Marsh v. Keating, 1 Bing. N. C. 198 [House of Lords]; Stone v. Marsh, 6 B. & C. 551). But that is not this case. Mr. Day’s certificates are not outstanding. They are in the possession of the plaintiff. There is no adverse claim to Mr. Day’s certificates ; and in the controversy between him and the company no third person is interested. . *
    II. If Mr. Day fails to establish what he has alleged in his action against the company, there must be judgment in that action dismissing his complaint. Certainly no third person is a party to a controversy which is to bring about that result.
    III. The controversy between the plaintiff and the defendants, other than Mr. Day, on the basis that Mr. Day shall succeed, is entirely different to that between Mr. Day and the company. (1) If the plaintiff has any claim against Denslow, Easton & Herts, and DeWolf & Swan, upon whose request the stock was transferred, and who surrendered to the plaintiff Mr. Day’s certificates with the forged powers, that claim is correctly asserted by the plaintiff in his complaint. They are responsible in damages for any loss which may result to the plaintiff (Brown v. Howard Fire Insurance Co., 42 Md. 384; Lowry v. Bank, Taney C. C. R. 310). Ho title to Mr. Day’s stock could pass to these defendants through the forged powers {Story Bills, § 111 ; Hambleton v. R. R. Co., 44 Md. 551; Thomson v. Bank of B. N. A., 45 Super. Ct. 1; aff’d, 10 W. Dig. 477). (2) Any relation of these defendants to the plaintiff is that of guarantors. The case is the same as that of one who has warranted the title of a defendant in ejectment. The plaintiff is not compelled, in the interest of the defendant, to make him a party to his suit (Pratt v. B. & O. R. R. Co., 126 Mass. 443 ; Cottam v. Eastern Counties R’y Co., 1 Johns. & Hem. 243 ; Taylor v. Bank of England, 28 Beav. 287 ; aff’d, H. L. Cas. 751; Sloman v. Bank of England, 14 Sim. 475 ; Dalton v. Midland R’y Co., 12 C. B. 458). (3) The only other class of defendants is those to whom stock has been issued upon the surrender of the first certificates issued in place of Mr. Day’s stock. The plaintiff must either make good to them their stock, or must compensate them in damages for any loss which they have sustained in relying upon the plaintiff’s certificates (N. Y., N. H. R. R. Co. v. Schuyler, 34 N. Y. 30 ; Davis v. Bank of England, 2 Bing. 293 ; Ashby v. Blackwell, 2 Eden, 299 ; Pratt v. Taunton Copper Co., 123 Mass. 110 ; In re Bahia & San Francisco R’y Co., L. R. 39 B. D. 584). With such action Mr. Day has nothing to do.
    IV. Some of the defendants assert that Mr. Day authorized the transfer of his stock. If he did, he will be beaten in his suit. He can only maintain his suit by proving what he has alleged—that the stock was wrongfully taken and that his signatures to the powers were forged.
    V. What really the plaintiff desires is to try six or eight lawsuits in one. Mr. Day is only interested in the suit which he himself has brought. He should not be embarrassed by being compelled to participate in the trial of other actions with which he has no concern. So far as concerns the present holders of the new certificates, they are neither parties to a controversy with Mr. Day, nor is one a party to a controversy between the plaintiff and any other. Each of Mr. Day’s certificates was separately surrendered to the company on an occasion when no other certificate was surrendered, and a new certificate was issued to a party to whom no other party has any relation. And furthermore, even if Mr. Day succeeds, the present holders in good faith of the new certificates, can none the less succeed against the plaintiff. For indemnity, the plaintiff must rely upon the defendants who guaranteed the genuineness of Mr. Day’s signatures. With the enforcement of that guarantee neither Mr. Day nor either of such holders has any concern. He brought Ms smt; it is in a court of competent jurisdiction; it will be determined upon correct legal principles ; it will be controlled by the facts which shall be established. He ought not to be prevented by his defendant, a wrongdoer as to him, from trying his own claim in his own sMt.

      Dillon & Swayne, attorneys, and John F. Dillon, Roger Swayne and Edward Patterson, of counsel for respondent, argued:
    I. The jurisdiction which equity had and has of this cause is threefold. 1. As upon a bill in the nature of an Mterpleader; 2. To prevent multiplicity of suits ; 3. To prevent irreparable damage. There are two subjects of cognizance in the action, (a) The seven hundred shares of stock and the claims thereto. (5) The dividends earned and not paid over, and the claims thereto.
    The plaintiff has actually been sued by Day. Some of the defendants claim title by legitimate transfers, and threaten suits as against the plaintiff to enforce their alleged rights to dividends on the shares, wMch dividends Day also claims. The claims of the defendants, therefore, are manifestly conflicting, and it is sufficient to maintain a bill in the nature of an interpleader, that a plaintiff is M danger of being molested by conflicting claims (Prudential Ass. Co. v. Thomas, L. R. 3 Chy. Ap. 14; Reid v. Commercial Ins. Co., 32 La. Ann. 546 ; Richards v. Salter, 6 Johns. Ch. 445 ; State Ins. Co. v. Monks, 1 Conn. 691; Salsbury Mills v. Townsend, 109 Mass. 115 ; Birch v. Corbin, 1 Cox Ch. Cases, 144). That Day claims the shares is obvious—that the parties who caused the transfers to be made insist that Day does not own the shares, is alleged. This controversy is not a shadowy, but substantial one. If the powers are forged no title passed out of Day (Davis v. Bank of England, 2
      Bing. 393 ; Swan v. N. B. & A. Co., 2 H. & C. 175 ; Taylor v. Midland R. Co., 6 Juris. N. S. 595). And if n© title passed out of Day, then the parties who caused the transfers to be made are hable to Day (Marsh v. Keating, 1 Bing. N. C. 198), or to the plaintiff (Sims v. Am. Tel. Co., L. R. 5 Q. B. Div. 175 ; Davenport v. Boston & A. R. R. Co., 135 Mass. ; Brownell v. Howard F. I. Co., 42 Md. 384; Hambleton v. C. & O. R. R. Co., 44 Md. 551; Canal Bank v. Bank of Albany, 1 Hill, 287). Both the holder of the old certificate and the new claim the rights of share owners in the fund as it existed prior to the transfer. Necessarily the claims of both relate to the same share of the fund, and it is equally obvious that each cannot be the exclusive owner of the share. The conflicting rights and interests therefore become patent. And in equity the plaintiff has a right to call upon them to settle that question between or among themselves, and at the same time to settle its own rights by a bill in the nature of. a bill of interpleader. That the plaintiff has an interest and calls upon the court to define and protect its rights, and to point out what they are, does not affect the status of the action (Charmley v. Dunsaney, 1 Sch. & Lef. 137; 2 Ib. 710 ; Mohawk & Hudson R. R. R. Co. v. Clute, 4 Paige, 384 ; Parks v. Jackson, 11 Wend. 443 ; Bedell v. Hoffman, 2 Paige, 299 ; City Bank v. Bangs, 2 Ib. 570 ; Story's Eq. Jur. § 824). An injunction goes, as of course, in an action properly framed for an interpleader (Snell Prin. Equity [5 ed.], ch. 12, p. 591).
    II. The action is well brought as one to prevent a multiplicity of suits. All the claims and rights and interests have the same starting point. They come from the transfer of shares once standing in Day’s name and now claimed by him. Those rights and relations which give rise to suits or threatened suits are : 1. Day’s claim to ownership. 2. The claims of the parties who caused the transfers to be made, that Day’s powers are genuine or were authorized. 3. The claims of the present holders of shares—involving considerations of the bona fides of their respective titles, and their freedom from the original fraud in transferring out of Day’s name, if there were such fraud. 4. The claims of the plaintiffs that if the powers are forged, those presenting the forged powers are liable ; or, 5. That if the transfers are merely colorable, and the present holders of shares have no title or a title affected by notice, they must surrender the certificates. All these various claims and rights would necessitate numerous actions if they are to be administered and adjudicated separately. Equity will bring in all parties and have all claims adjudicated in one action (Third Av. R. R. Co. v. Mayor, &c., 54 N. Y. 159 ; Story’s Eq. J. §§ 852, 854, 901, and notes ; Howe v. Tenants of Broomgrove, 1 Vern. 22 ; Mayor of York v. Pilkington, 1 At. 282; Carroll v. Stafford, 3 How. U. S. 463 ; N. Y. & H. R. R. Co. v. Schuyler, 17 N. Y. 573). That a suit is already pending by Day against plaintiff, on his particular claim, adds to the plaintiff’s equity (McHenry v. Hazard, 45 N. Y. 581). Even if there is a good defense at law by the plaintiff to Mr. Day’s suit, that does not prevent nor interfere with the granting of the equitable relief sought by this bill (Scott v. Onderdonk, 14 N. Y. 14; Ward v. Dervey, 16 Ib. 522 ; Wood v. Seeley, 32 Ib. 113 ; McHenry v. Hazard, 45 Ib. 580 ; Fowler v. Palmer, 62 Ib. 534). It has been suggested that the remedy of the Cable Company is in the exercise of the right to give notice to other parties to come in and defend the original action. This right, and the right to file a bill of interpleader, or a bill in the nature of an interpleader, and to restrain,, etc., have existed together too long for one to be now held the exclusive remedy. Besides, the right to give notice to come'in and defend, secures merely the negative advantage of estoppel, while we are entitled to ask a decree, affirmatively fixing the rights and liabilities of all the parties. The case of Prudential Assurance Co. v. Thomas (L. R. 3 Ch. App. 74), is-an authority against the suggestion.
    III. The bill lies to prevent irreparable injury. “ A case of irreparable injury to the plaintiff, and one where no such injury can be produced to the defendant, is one eminently of equity jurisdiction ” (Brown v. Pacific Mail S. S. Co., 5 Blatch. 525). The irreparable injury likely to ensue, if Bay’s suit is not enjoined, is readily pointed out. If Day proceeds to judgment against the plaintiff on the ground of the alleged forgery of the powers, or the alleged fraudulent practices by which the title to the shares was diverted from him, and then the plaintiff seeks to recover against the parties who caused the transfers to be made, those parties would not be bound by the judgment in Day’s suit (Doe v. Earl Derby, 1 Ad. & E. 783 ; 2 Smith’s Lead. Cas., notes,* 669, et seq.). Certain of the defendants herein claim and insist that the powers are genuine. If they prove that as against the plaintiff, then the plaintiff would lose twice, and it is exposed to that peril, to prevent which the injunction is asked. In addition to that, the loss of all the costs and expenses of contesting all the various claims that are made to the stock and dividends, and of the institution and defense of the suits the company would have to bring or to resist to maintain its rights, are substantial elements of apprehended and actual damage. Part of the relief prayed for is that if it be adjudged that the shares were transferred on forged powers, such of the defendants as hold certificates so transferred, be required to surrender and deliver them up. This is prayed for in addition to other relief. How far the present holders are bona fide holders for value the plaintiff cannot determine. If the original transfers from Day are tainted with crime or fraud, there may be a strong presumption that the infection continues, and if it be so the instruments should be surrendered and canceled. Under such circumstances equitable relief is granted (Springport v. Teutonia S. Bank, 75 N. Y. 397 ; Power v. Village of Athens, 19 Hun, 165). The cases of Town of Venice v. Woodruff (62 N. Y. 462), and Buffalo Grape Sugar Co. v. Alberger (22 Hun, 349), are not authorities against the plaintiff. The suggestion that the plaintiff, might call upon those who presented the certificates of Day for transfer to come in and defend Day’s suit, cannot affect the jurisdiction and right of a court of equity to afford relief in a proper case. It is true that certain of the defendants are, by implication of law, guarantors of the genuineness of Day’s signature to the powers of attorney—-but a court of equity, in the exercise of its jurisdiction, is not restrained by any such consideration, and this would be especially so in a case like the present, in which so many sides are presented of inevitable contest. Besides, it is a matter of very grave doubt as to whether the giving of notice to a surety will bind him by a judgment, unless he has in terms covenanted to be bound by such a judgment upon notice to him to come in and defend (National Fire Insurance Co. v. McKay, 5 Abb. N. S. 448 ; Thomas v. Hubbell, 15 N. Y. 407).

      Bergen & DyJsman, attorneys, and Benjamin F. Tracy and Wm. IV". DyJsman, also argued on behalf of respondents, DeWolf and Swan.
   By the Court.—Sedgwick, Ch. J.

I am of opinion that the order appealed from should be reversed. The defendant Day, in bringing the action against the plaintiff, exercised a legal right. The action should not be stayed, unless the plaintiff discloses some equity in its favor.

/ There is no such equity as is based upon principles that sustain actions of interpleader or in that nature. For the alleged perplexity as to the defendant to whom the right, supposed to be in question, belongs, or the danger of being obliged to satisfy the claims of opposing parties, has not arisen without fault on plaintiff’s part, but has arisen from an act done voluntarily and advisedly by itself. Its duty towards defendant Day, not to issue a certificate of his shares to another without authority, was absolute. When it did, it is supposed that it was in possession of all the proofs that were necessary to show without doubt that its action was justified: If it omitted any care or caution, or did not use means it legally might, the consequences should equitably fall upon itself. The plaintiff should not now seek a determination as to whether it was right or wrong, by compelling Day to litigate with the other parties. Indeed, there could be no such litigation, for first and last, so far as Day is concerned, the litigation would be between him and the plaintiff.

In accordance with like considerations, a party charged with a tort in the conversion of property, cannot, except a statute provide for it, interplead the person making the charges with others claiming adversely to him, under whom the party charged acted.

There is not shown to be any danger of vexatious actions or suits in the proper sense of that term. In fact, the complaint does not show that those defendants whose claims are alleged to be at variance with the claim of Day, threaten the plaintiff with any suit whatever. Those defendants are in possession. They are content with things as they are. Perhaps the contingency may never arise, that would make it for their interest to bring any action. They certainly would not bring any action if the plaintiff can justify its action in transferring its shares, and as has been said, it is legally bound to be prepared to justify if it can. It would seem that there could arise no litigation, until the plaintiff is forced to the position of having violated a duty as to Day. Therefore, there is no equity based upon the avoidance of a multiplicity of actions, if that of itself constituted an equity, which it does not.

I am of opinion also that the supposed differences or anticipated issues, between the plaintiff and the various defendants, are not ad idem. The plaintiff has, and under the complaint will have the stock, shares in which belong either to Day or to some of the other defendants. The defendants do not claim that stock, and the plaintiff claims no interest in the shares. Thedefendant- Day makes only the claim that the plaintiff shall return to him as his property, the certificate' which the plaintiff took when it transferred his shares apparently, and shall recognize him as shareholder. The other defendants may, at some time, resist the plaintiff’s refusing to recognize them as shareholders, or its endeavor to cancel their certificate of ownership. The issues, whenever made, will not regard the same thing, although a controlling piece of evidence may be the falsity or genuineness of Day’s signature to the authority to transfer. I therefore think that the complaint is multifarious.

The order should be reversed, with costs.

O’Gorman and Ingraham, JJ., concurred.


author: By the Court.—Truax, J.

text:
    RAMON MONNE, et al., Appellants, v. FREDERICK F. AYER, et al., Respondents.

      Reformation of instrument—representations of legal effect.—Joinder of actions.—Damages recoverable in action for reformation.

    A false declaration of the legal purport and effect of an instrument is a sufficient ground for its reformation'—e. g., a lessor, on his attention being called, by the lessee, to the omission, from a proposed written lease, of sundry provisions which formed part of the oral agreement, in execution of which the written lease was to he made, represented that it was a matter of no importance, because the provisions had been previously agreed on and such previous agreement would not be affected by the execution of the lease ; believing and relying on which statement the lessee executed the lease. Held, a proper case for reformation. There was either a mutual mistake, or mistake on one side and fraud on the other.
    Wilson v. Been, 74 H. Y. 531, distinguished.
    Damages for breach of instrument when reformed may be sued for and recovered in the action for reformation.
    Before Trtiax and O’Gorman, JJ.

      Decided May 26, 1885.
    Appeal from judgment in favor of defendants dismissing the complaint on the merits, entered upon an order made on the trial of an issue of law raised by a demurrer to the complaint, sustaining the demurrer and ordering final judgment of dismissal of the complaint.

      The facts appear in the opinion.

      Wingate & Cullen, attorneys, and George W. Wingate, of counsel for appellants, argued:
    I. The complaint alleges, that when the plaintiffs objected to the omissions before the lease of the covenants agreed upon (as to repairs and steam), the defendants stated “that this was a matter of no importance; that as it had been previously agreed upon it would not be affected by the execution of the lease presented.” This justifies a court of equity in reforming the contract (Maher v. Hibernian Insurance Co., 67 N. Y. 289 ; Warren v. Sandborn, 82 Ib. 604). The rule is, that equity will reform a written instrument in cases of mutual mistake, and also in cases of fraud, and also where there is a mistake on one side and fraud on the other (Hay v. State Fire Insurance Co., 77 N. Y. 240; Welds v. Yates, 44 Ib. 525). The rule that there must be a mutual error to authorize the interposition of a court of equity, only applies where the element of honesty exists on the part of the one correctly understanding the contract. It does not apply where there is a fraud (Gillon v. Borden, 6 Lans. 219).
    II. It is immaterial that the statements made by the plaintiff in regard to the effect of the omissions of the clauses in question from the lease were as to matters of law (Cook v. Nathan, 16 Barb. 342 ; Johnson v. Hathorn, 2 Abb. Ct. App. Dec. 469 ; 2 Keyes, 484; Barker v. Clark, 12 Abb. U. S. 115). Fraud, in the sense of a court of equity, properly includes all acts, omissions and concealments which involve a breach of legal or equitable duty, trust or confidence, justly reposed, and which are injurious to another, or by which an undue and unconscientious advantage is taken of another (Gale v. Gale, 19 Barb. 249).
    III. The defendant cannot allege that the plaintiffs were guilty of laches in believing his statements (Albany City Savings Bank v. Burdick, 87 N. Y. 404; Mead v. Bunn, 32 Ib. 280).

      IV. The action was properly brought for a reformation of the lease, and for the recovery at the same time upon it, when reformed (Maher v. Hibernia Insurance Co., 67 N. Y. 293 ; N. Y. Ice Co. v. Northwestern Insurance Co., 23 Ib. 357).
    V. The court below erred in holding that the preliminary contracts were merged in the lease, (a.) The agreement to furnish steam being upon an independant consideration, i. e., the payment of the cost for what was used, was an independent agreement, and not within the rule (Lewis v. Seabury, 74 N. Y. 409 ; Erskine v. Adams, L. R. 8 Ch. App. 736 ; Morgan v. Griffith, 6 Exch. 70). (b.) The same principles apply to the claim for damages caused by the landlord’s failure to fix the steam pipes.

      L. H. Babcock, attorney, and of counsel for respondents, argued:
    I. There is no ground for the intervention of a court of equity to reform this lease. This is not a case of mutual mistake, or mistake on one side and fraud on the other. There was no mistake on either side, but both parties éxecuted the lease with full knowledge of its contents. “The parties having agreed to the form of the lease as it was, no action for its reformation lies ” (Wilson v. Deen, 74 N. Y. 531; Johnson v. Oppenheim, 55 Ib. 280 ; Bryce v. Lorillard Fire Ins. Co., 55 Ib. 240).
    II. Courts of equity refuse to grant relief for ignorance or mistakes of law (Kent v. Manchester, 29 Barb. 595 ; Carpentier v. Minturn, 6 Lans. 56 ; Story Eq. Jur. §§ 111-114; Jacobs v. Morange, 47 N. Y. 57).
    ITT. The stipulations set forth in the complaint as having been made by the respondents prior to or at the time of the lease, furnish no grounds which this court can take cognizance of for its reformation, by inserting such stipulations therein. This is settled in the case of Wilson v. Deen (74 N. Y. 531), where the court says: “ The current of our authorities sustains the proposition that both at law and in equity, one who sets his hand and seal to a written instrument, knowing its contents, cannot be permitted to set up that he did so in reliance upon some verbal stipulation, made at the time, relating to the same subject, and qualifying or varying the instrument which he thus signs. The very purpose of the rule which excludes evidence of such declarations is to avoid the uncertainties attendant upon such evidence, and equity will not set aside that important and well settled rule, for the purpose of relieving a party against a risk, which, upon his own showing, if it be true, he has voluntarily incurred. It is only when, through fraud or mistake, a party has executed an instrument which he believes to be in accordance with the real agreement, but which is in fact different, that equity will relieve ; and even then the mistake, as well as the agreement, must be made out by clear proof.”
    IY. There is no charge of fraud which would justify, under any circumstances, the interference of a court of equity. The principle of Long v. Warren (68 N. Y. 426), applies. This is not like the case of the Albany Savings Institution v. Burdick (87 N. Y. 40), cited by plaintiffs at special term. There the person to whom the plaintiff had intrusted the drawing of a deed had, without her knowledge or consent, inserted a clause by which she assumed the payment of a mortgage. The court held that she was not chargeable with negligence in not reading the deed, because she had a right to confide in her agent. But Monné Bros, do not stand in such a position. They were one of the parties to a business transaction, viz., the purchasers of a lease, and were governed by the rules laid down in Long v. Warren (supra).

   By the Court.—Truax, J.

The complaint alleges that plaintiffs and defendants had had negotiations relating to plaintiffs’ hiring a certain building from defendants ; that during the negotiations, plaintiffs promised to take a lease of the building, provided the defendants would do certain repairs, and would furnish plaintiffs with steam for the building ; that defendants agreed to do the repairs and to furnish the steam ; that defendants presented plaintiffs a lease which did not contain the covenant to make the repairs and furnish the steam ; that plaintiffs called defendants’ attention to that fact; that defendants said that it was a matter of no importance, because the matter had been previously agreed upon between the parties, and such previous agreement would not be affected by the execution of the lease ; that plaintiffs relied upon said statement and executed the lease ; that defendants refuse to do the repairs and furnish the steam, that plaintiffs have done the repairs at an expense to them of $500, and that they have been damaged to a large amount by the neglect and refusal of the defendants to furnish steam ; and the complaint demands that the lease be reformed by inserting therein provisions for the repairs and steam, and that plaintiffs recover damages for defendants’ breach of the lease, as it will be after it has been reformed.

To this complaint the defendants demurred, on the ground that it does not state a cause of action. The demurrer was sustained by the special term.

The acts of the defendants in representing to plaintiffs that it was not necessary that the lease should contain a covenant relating to repairs and steam, may be looked at in two lights. It may be that defendants really believed that it was not necessary that the lease should contain the covenant, or it may be that they knew that the lease must contain the covenant in order to bind them, and that they misled plaintiffs for the purpose of obtaining a more advantageous leasing of the premises.

If the lease was entered into because of the belief first above stated, it was a mutual mistake which would warrant the court in reforming the contract. If it was entered into because of the reason last above stated, it was a fraud on the plaintiffs, and the contract should be reformed (Welles v. Yates, 44 N. Y. 525, and cases there cited ; Waring v. Somborn, 82 Ib. 604).

This case is to be distinguished from Wilson v. Deen (74 N. Y. 531). In that case, the covenant on the part of the landlord was not inserted in the lease, because the plaintiff did not think it necessary to have it inserted. In this he was mistaken ; but the defendant did nothing to deceive or mislead him. While in the case at bar, plaintiffs relied upon the erroneous information given by defendants.

It is true, the defendants did not induce plaintiffs to believe that the deed, as a matter of fact, contained the agreement to make repairs and furnish steam, but they did induce plaintiffs to believe that it was not necessary that the lease should contain such an agreement. There was mistake on both sides, or there was mistake on one side and fraud on the other. Either is ground enough for reforming the agreement (Waring v. Somborn, supra). A false declaration of the legal purport and effect of a deed will render it voidable, whether the misstatement had its origin in a wish to deceive, or in the mistaken belief of him who made it (Broadwell v. Same, 1 Gilman, 899 ; Tyron v. Passmore, 2 Barr, 122 : Snyder v. May, 7 Harr. 239 ; Edwards v. Brown, 1 Tyrwhit, 182 ; Chesnut Hill Reservoir Co. v. Chase, 14 Conn. 123 ; Jordan v. Stevens, 51 Me. 78 ; Fillman v. Curtis, 15 Ib. 140 ; Cooper v. Phibbs, L. R. 2 H. L. 149 ; Broderick v. Same, 1 P. Wms. 239).

It is settled in this state that one may bring an action to reform a contract, and in the same action may recover damages for the breach of the contract as it is after it has been reformed (New York Ice Co. v. N. W. Ins. Co., 23 N. Y. 357; Maher v. Hibernia Ins. Co., 67 Ib. 283 ; Welles v. Yates, 44 Ib. 531, and cases there cited).

The order and judgment appealed from are reversed with costs, and the demurrer is overruled with costs, with leave to the defendants to withdraw demurrer and answer on payment of costs.

O’G-ormar, J., concurred.