author: Sedgwick, Ch. J.

text:
    SAMUEL C. REED v. EZRA Z. HAYT.

      Pleading—denial coupled with affirmative allegations, effect of.—Wonjoinder—when will not prervent recovery.—Corporation, consideration for . transfer by it of stocls—trustee an interested party, effect of.—ratification of acts of—non-notice of trustees' meeting, effect of.—Contract—abandonment of—option.

    The complaint averred the performance of alL conditions precedent; the answer denied all the allegations not thereby admitted. It then affirmatively alleged that plaintifi had not performed all the conditions precedent, and enumerated certain things which, it specifically alleged, showed that the conditions had not all been complied with.—Eeld, that the issue was confined to the particular breaches of conditions specifically referred to. Where the non-joinder of a party is not pleaded, and it does not appear that the right of the parties to the action cannot be definitely determined without the presence of such other party as a defendant.—Held, that such non-joinder should not prevent a recovery.

      Decided December 8, 1884.
    Where a precedent debt was due by the corporation to the transferee,—Held, a sufficient consideration to support the validity of a transfer by the corporation of its own stock. Further held, that although the resolution authorizing the transfer was passed at a trustees’ meeting, the presence at which of the transferee as a trustee, constituted a quorum, yet it may be ratified by the company and stockholders.
    Where one who, forthwith on the passage of such resolution, becomes the president of the company, and who (under a certain agreement made by him for, among other things, the purchase of stock of said company), was to become the owner of the stock transferred under the resolution, and did in part performance of the agreement, receive some shares of another kind as to which there was no dispute,—after learning the facts respecting the passage of said resolution took the benefit of an extension of time of performance of the agreement, neither the company nor the other stockholders having in the meantime assailed the issuing of the stock. Held, a ratification by him, and that the possibility that some • other stockholder might disaffirm was no defense to an action against him for the purchase money tof the stock held by the plaintiff under such resolution.—Further held, that non-notice of such trustees’ meeting to all trustees, under the above circumstances, and the additional one that the transaction had been executed, did not constitute a defense.
    The giving a vendee an option to take such of the property sold as remained undelivered under the contract of sale, upon payment to a designated company of the purchase money agreed to be paid therefor by the contract of sale, and the giving, at the vendee’s request, an option to a third person to take the property so undelivered, and other property for a certain sum which was to be applied to the vendee’s indebtedness under the contract of sale,—Held, not an abandonment of the contract of sale, the option never having been exercised, and the evidence showing that it was not the intention of the parties that they should annul such contract.
    Before Sedgwick, Ch. J., Van Vorst and Freedman, JJ.
    Motion by plaintiff, for judgment upon a verdict, directed for plaintiff, subject to the opinion of the general term. ■
    The facts sufficiently appear in the opinion.

      E. L. Fancher,

    attorney, and of counsel for plaintiff, argued :—I. The defense as to an alleged indebtedness of the company to Stearns wholly failed. No such indebtedness existed until after the execution of the contract sued on, and then it arose on an obligation created by the defendant.
    II. It is absurd to claim that the sealed contract of the defendant was waived or abrogated. Giving to the defendant an extension of time to pay the $35,000 did not waive or abrogate the contract to pay. Nor did the consent of plaintiff, called an option,” by which, at the request of defendant, Mr. Grannis had an option to take the stock, on making payment for it to the trust company, have such effect. As matter of law, the transactions or indorsements mentioned did not abrogate or dissolve the specialty on which this action is brought. The indorsements are not in terms to that effect, and they are not instruments of equal solemnity—not being sealed (Clough v. Murray, 3 Rob. 16). And there was no intention to waive the sealed contract. There was nothing in the papers indorsed on the envelopes giving to the plaintiff any new remedy or right of action in case the options there mentioned were not accepted. There was no discharge of the defendant’s covenant thereby, nor any intention to discharge it manifested.
    III. The plaintiff had lawful title to the stock and patents transferred by him ; and the defendant, on payment as required by his contract, will have good title thereto. It is not proper to inquire into the validity of that stock, or its transfer, in this action. Neither the company, nor its stockholders, so far as appears, have taken any steps to impeach the plaintiff’s ownership of the stock which he deposited in the Central Trust Company, and they are not parties to this action. Any objection to the validity of the stock, or the plaintiff’s title to it, founded on the fiduciary relation of the plaintiff to the company and its stockholders, could be waived or not, as they thought best; but any such repudiation of the validity of the trustees’ action must be made at the instance of the corporation or of its stockholders. It cannot be questioned collaterally (Risley v. Indianapolis B. & W. R. R., 62 N. Y. 248 ; Barnes v. Brown, 80 Ib. 536 ; Greaves v. Gouge, 69 Ib. 154).

      G. C. Horne, attorney, and J. R. Dos Passos, of counsel for defendant,
    argued:—I. Objections to the plaintiff’s recovery arising out of his own case, (a.) This case comes before the court on a motion of the plaintiff for a judgment under section 1185 of the Code. It is, therefore, to be treated precisely as an original action and it is incumbent upon the plaintiff to show that he has a good cause of action against the defendant upon some legal ground. This action is brought upon a sealed tripartite agreement between Samuel C. Reed, party of the first part, the plaintiff in this action; the United States Ice and Refrigerating Company of the City of New York, of the second part; and Ezra A. Hayt, the defendant, of the third park. The United States Ice and Refrigerating Company of the City of New York is not a party to this suit, and it accordingly follows that there is a fundamental defect in the action of the plaintiff, in seeking to enforce a contract' against one of the joint contractors without the presence of the other contracting party. The basis of the plaintiff’s claim is upon this sealed instrument, and according to his theory that forms the sole ground of his action. This omission to introduce the third party into this suit, is more than a mere defect of parties which is remedied by the failure of the defendant to interpose a demurrer or to set up the defect in his answer. (6.) Another defect in the plaintiff’s case is to be found in the fact that he did not tender the stock to the defendant, or produce the same upon the trial, and show a willingness on his part to deliver the same, (c.) The plaintiff’s case is also defective in not showing the performance by him of one of the conditions precedent which he assumed under the contract, viz., to deposit the resignations of three of the directors in the Trust Company. (d.) Finally, the plaintiff did not show any damage.
    II. But irrespective of these propositions, the evidence discloses several distinct and perfect answers to the plaintiffs right to recover, (a.) The plaintiff was not the owner of 1,622 of the 4,550 shares which he engaged and contracted to sell to the defendant. Those shares were the property of the company and were transferred to plaintiff pursuant to a resolution passed at a meeting at which the plaintiff was present, he voting for it. At the time this resolution was passed there were five directors of the company three of whom (the plaintiff being one of the three) were present at the meeting. Three trustees constituted-a quorum, and without the presence of Reed, and his participation in the meeting at which the stock was voted to himself, there could have been no quorum, and no legal meeting of the company. The plaintiff was disqualified from acting, because he could not deal with himself, and without himself there was no quorum of the directors, and they had no authority to pass the resolution (Butts v. Wood, 37 N. Y. 317). Moreover, the meeting itself was illegal, because no notice of the meeting was given to Mr. Randall, one of the directors, and he knew nothing whatever of the issue of the stock until his attention was called to it by the defendant in this case. Under the by-laws of the company it is provided as follows : “ Section 4. Special meetings of the board may be held at any time on the call of the president or one of the trustees, due notice being given by the secretary.” The meetings of a joint stock corporation must be called by a personal notice to all the members, unless some other provision is made in the charter or in a by-law, and a vote passed at a meeting not so called is not binding (Angell and Ames Corps. § 493, 10th Ed. ; Wiggin v. Free Will Baptist Church, 8 Met. 301; Rex v. Feversham, 8 T. R. 356; Rex v. May, 5 Burr. 2682 ; Rex v. Langhorne, 6 Nev. & M. 203 ; Smyth v. Darley, 2 H. L. Cas. 803; Stow v. Wise, 7 Conn. 219 ; Field Corporations, § 224, 234; State ex rel. Reeves v.
      Ferguson, 2 Vroom, 107; People ex rel. Swinbourne v. Albany Medical College, 26 Hun, 348 ; 89 N. Y. 635 ; Morawetz on Corps. §§ 267, 356).
    The answer of the counsel of the plaintiff to this proposition, is that this transaction cannot be inquired into collaterally, and this view was indorsed by the learned trial judge in this language : “ The question can only be raised where the corporation is a party. They are bound to make their election, and not having elected to declare the transaction void, it is too late for them to do it now.” We submit that this constitutes no answer whatever in law to the proposition. The defendant in this action did not discover the illegality of this issue of stock until May, 1881. If the defendant had accepted the stock from the plaintiff, he could not have procured its transfer; he would have held something, that in his hands would have had in law no value whatever. The company could set up the illegality of the stock; the doctrine of estoppel could not be applied, and would not arise because the defendant knew that the stock was illegal, and he could not say that he was a bona fide holder of it.
    Kent v. Quicksilver Mining Co., 78 N. Y. 150; Risby v. Indianapolis B. & N. R. R., 62 Ib. 248 ; Barnes v. Brown, 80 Ib. 536 ; Greaves v. Gorge, 69 Ib. 159 ; have no analogy to the present case.
    (6) Under the covenants in the contracts if it appear that the company was indebted to any one during the existence of the contract and before the stock was delivered, there was no obligation on the part of the defendant to carry out the contract. The evidence discloses that the company was indebted to one Oscar H. Stearns. The liability of the company and its indebtedness dated back to July 29, 1879.' (c) The contract was abandoned by mutual agreement of the parties. A new and distinct contract was entered into between the plaintiff and the de^ fendant, to which the Eefrigerating Company was not a party. This contract is evidenced by the following writing. “ Sealed package containing securities between Samuel 0. Reed and E. A. Hayt, this package containing three certificates of stock of the U. S. Ice and Refrigerator Co. of the city of New York is to he delivered to Mr. E. A. Hayt on or before the 7th day of June, 1881, on the payment to the Central Trust Co. of $25,000. Should this payment not be made on said day, then this package to be returned to the said Samuel C. Reed on the day following ; the said sum of $25,000 to be placed to the credit of said Samuel C. Reed on the books of said Trust Company.” The plaintiff treated the original contract as at an end because on the same day that the defendant’s option to take the stock expired, viz. : June 7, 1881, the plaintiff made a contract for the sale of the stock to another party, a Mr. Grannis, and when the defendant went to the Trust Company to see if the original package was there, he found it was not there, but an envelope was there giving Mr. Grannis an option to take the stock, and that option had not then expired.
    III. Assuming that there is a liability on the part of the defendant for breach of the contract, what is the measure of damage ? The rule is laid down by the commission of appeals in Dunstan v. McAndrew (44 N. Y 72). See also Hayden v. Demets (53 N. Y. 426). In the present case the plaintiff elected to keep the property. There was no tender of the stock on the trial or at any other time previous to the beginning of the action, and it is perfectly manifest that the plaintiff used and regarded the stock as his own. He was accordingly bound to prove that he had sustained damage at the time of the breach, to wit, on June 7, 1881.
   By the Court.

Sedgwick, Ch. J.

The propositions which have been argued, must of necessity be confined to the issues raised by the answer. The complaint averred, that the plaintiff had performed all conditions precedent of defendants, liability. The answer denied each and every allegation in the complaint not herein admitted. This is left by itself, might have made an issue as to each condition precedent in the contract. Such was not its intention, for the answer proceeds, “that the plaintiff has not duly performed all the conditions of said agreement on his part, but on the contrary, although said agreements contained” conditions, etc., and then it enumerates certain things, which it specifically alleges show that the conditions had not all been performed. The issue is thus confined to the particular breaches of condition specifically referred to. These matters will have further attention in considering the reasons, urged by the learned counsel for defendant, for setting aside the verdict.

In the absence of an allegation in the answer that the corporation should have been made a defendant, the plaintiff should not be prevented from recovering as it does not appear, that without the corporation as a defendant, the rights of the present parties cannot be definitely determined.

A tender of the shares was not necessary, as the contract provided that they should be placed with the Trust Company, and that while there the defendant should pay, as provided.

The answer does not defend on the ground that the plaintiff had not deposited the resignations of their directors, as required by the contract. It has already been shown in what manner, the defendant pleaded the breaches of conditions. The answer makes no reference to this subject. But the testimony shows that plaintiff performed in this respect.

The counsel for defendant relies on the correctness of the following propositions maintained by him : 1st that the plaintiff was not the owner of 1,622 of the 4,550 shares which he contracted to sell to the defendant, and 2nd that these 1,622 shares, were not full paid and unassessable shares.

The contract provided that “the party hereto of the first part,” that is, the plaintiff, “is the owner of the 4,550 shares of the said stock, full paid and unassessable as aforesaid.”

The defence in the answer, as to this subject matter is, that “the plaintiff was not, and never was the owner in good faith of about 1,622 shares of the said stock, so deposited by him, and could not lawfully transfer the same to the defendant, so as to create an absolute and unimpeachable title thereto in this defendant, for the reason that said shares of stock were the property of the said company, and had been at a meeting of the board of directors of said company, held without notice to all of said directors, at which meeting were present only the plaintiff and two others of said company, unlawfully voted to the plaintiff, without consideration therefor, and thereupon transferred to him, in fraud of the rights of said company and of the stockholders therein.”

The proof that certificates for such shares had been issued to the plaintiff, made it necessary for the defendant to show that the facts existed which would invalidate the-shares in the hands of the defendant. He proved the following facts : about a year before making the contract in question, there was held a special meeting of the board of' directors. Three directors, hicluding the plaintiff, were present. The following resolution was adopted : that, whereas, the president (the present plaintiff) had filled that office since the organization of the company in January-1869, without the receipt of any salary, and had also advanced to the company considerable sums of money which have not been repaid him, resolved that all the shares of stock now remaining in the treasury, as well as all that may now be due to it, held as collateral, be and hereby is-, donated and given to the said Eeed, the same to be in full, payment for such services and such advances as aforesaid. The certificate for the 1,622 shares was thereupon issued to the plaintiff, he himself signing the certificate as president. There was no proof that the shares held as collateral amounted to any particular sum, or that any such shares had been issued to the plaintiff. It was proved that one of the five directors had not received notice of the intended meeting. The plaintiff testified that he had given one to a boy, to be delivered to that director. He further testified that before the meeting, he had advanced in money to the corporation $20,000 ; that he had received ho compensation for his services as president and had never claimed any ; and that the offer of compensation was made by the other directors present at the meeting.

The answer, it will have been noticed, does not rest a defense upon the stock not being full • paid and being “ unassessable.” Such a defense would imply,, that the plaintiff might be the owner, although hable to respond to creditors, on certain conditions. The defense is, that the corporation was the owner of the shares, and the plaintiff was not the owner, because the transaction by which they were issued was void, or might be avoided as against the defendant, who took with notice of the facts ; for the reasons, 1st, there was no consideration for the transfer ; 2d, it was invalid, because the plaintiff, being a trustee of the company, could not make a quorum, Avhen Avithout him there would be no quorum competent to transact business in the interest of himself personally; 3d, the meeting was invalid for want of notice to all the trustees.

, The first position is against the fact. The consideration was the satisfaction of a debt due by the company to the plaintiff. In Barnes v. Brown (80 N. Y. 521), the plaintiff took broader ground than is occupied by the plaintiff' here, and alleged, that the stock which had been transferred to him “was not full-paid stock, but the certificates were unlawfully issued Avithout any consideration, for the purpose of making up stock to be delivered under the contract.” The action was for damages for the fraud in delivering to him the stock under a contract which called for full paid capital stock. The complaint did not allege that the company had not issued or transferred the shares, or that the defendants were not the owners thereof. . The case has some bearing upon this appeal, because it referred to the consideration for which the company issued the certificates of shares.

. The court in the opinion, says that the plaintiff proved, by the minutes of the company, that the shares were issued by the defendants ostensibly for moneys advanced and services rendered. Thereupon, the plaintiff offered to prove that the stock was issued without any valid consideration of payment and for the purpose of making up stock to be delivered to the plaintiff under the contract in action. It there said, “the obligation to bind the plaintiff for such stock could not be discharged by delivering to him worthless spurious stock, wrongfully issued by the company, without any consideration received therefor. It is not claimed and could not be claimed, that the corporation or its directors, could create any valid stock by issuing the same, without any consideration.” “ The proof thus offered was very material, and if received would have gone far towards completing the proof requisite to sustain the action.” The court did not hold that the proof given of the minutes showed that issuing of stock for moneys advanced was no consideration, but did hold that that the plaintiff was entitled to show that in fact, there was no consideration ; in other words, that the consideration appearing on the minutes did not exist in fact. In the present case, there was no dispute that the plaintiff had made the advances as testified by him, and took the shares in satisfaction of that demand. The fact of the advance and that good faith, were not denied, it seems to me, make the issuing of the shares the equivalent of a money subscription, offset as it might be, by the amount due to the plaintiff. There was intrinsically no fraud upon the company, stockholders or creditors, for each of these were placed in a better relation to their interests in the property of the company by the plaintiff relinquishing his place of preference or creditor, for a right to share, after payment of debts. The first position should be held not to be valid.

As to the second position, its merits rest upon the fact that the plaintiff, as a trustee, could not act for the company, in a transaction in which he received a benefit. This however, is to be limited by further saying that his beneficiaries could, if they thought it to their interest, ratify his act, or at their option, avoid it. The company was a party to the agreement in this case and would be held to have ratified the issuing of the certificate of the shares, if it were not that their execution of the agreement was made by the plaintiff himself. The company, as appears by the plaintiff’s testimony, forthwith went into the control of other persons, the plaintiff resigning, and the defendant taking the office of president. There were no avoidance of the issuing of the shares, and the assent and tacit ratification by the company was guided by the defendant himself. The other beneficiaries were stockholders. None of these have in fact, assailed the issuing of the certificate. Whether they might do so in a proper action, should be considered in view of the fact that the defendant was to become a stockholder, upon performance of the agreement. He did, upon part performance, receive some of the shares of another kind, as to which there was no dispute. At the end of nine months from the making of the contract, he learned the facts of the issuing of the stock, and after that he took the benefit of an extension of time of performance, for such substantially, was the option that will be hereafter refered to, until the 7th of June. The plaintiff’s position in the mean time., was that he could not enforce his claims against the company for the advances. This made it necessary for the defendant as stockholder, to avoid at once the action of his trustee, the plaintiff, unless he wished to affirm the validity of the shares. No steps were taken towards disaffirmance, and he consequently, in effect, affirmed. If he did not disaffirm, there is no reason for supporting a defense that some other stockholder might therefore disaffirm. Such a possibility cannot be entertained in favor of the defendant, in view of his own acts.

Similar considerations apply to the third position, that the meeting of directors was invalid for want of notice to them. Beside the mere resolution at the meeting, the transaction had been executed, the plaintiff had received the certificate and had satisfied his demand against the company. This executed transaction could not be opened by any one, except through the action of a court of equitable jurisdiction, and it would require that the plaintiff be placed in his original position. So far as the proof of the defendant discloses, every one interested had countenanced or ratified the plaintiff dealing with the stock as owner, with a knowledge of the facts, and the action referred to would not he.

Another defense was, that before the time for the delivery of the shares in question, the company had become indebted to Mr. Stearns, in the sum of $3,000. If this indebtedness was within the intention of the agreement, it was to be provided for by being paid out of the $25,000, which the defendant was to pay, and perhaps the defendant might have, in that account, reduced the recovery directed below. This was not requested by him.

There are many phrases in the contract which refer to the matter of the company’s indebtedness. It is impracticable to state them all. I will have to be content with giving my opinion, that, in view of the whole contract, it" did not intend that the indebtedness of the company it referred to, should be a debt contracted by the company, after the defendant had become its president, according to the purposes of the contract.

Another defense was, that the contract was abandoned by mutual consent and agreement of the parties. There was no express agreement of that kind. The facts that were relevant to the defense, were that after a breach by defendant, the plaintiff at defendant’s request gave in writing, an option to defendant to take the shares undelivered under the contract, upon payment to the Central Trust Company, of the money that the defendant had promised to pay by the contract. Also, at the request of defendant, the plaintiff had given a third person an option to take these shares and another 1,000 shares, upon payment of a sum, which was to be applied to the defendant’s indebtedness under the present contract. Neither of these options was carried out. The evidence showed that it was not the intention of the parties, that the giving of the options should annul the present contract, but that, if money should be paid upon them, that money should go in liquidation of the amount due upon the contract, which it was intended should be kept alive. In fact, the option given to the defendant was nothing more than an extension of time, for the purpose of his performing the contract.

The last position to be noticed is, that the true measure of damage was the difference between the market value of the stock and the price named in the agreement. This implies that the plaintiff upon breach of the contract, had taken the stock and appropriated it to himself, and did not hold it, for the defendant. The facts do not show such an implication. The testimony did not prove that the plaintiff held the. stock otherwise than for the defendant.

Motion for-judgment for plaintiff in the amount of the verdict, granted with costs.

Van Vobst and Freedman, JJ., concurred.


source: Caselaw Access Project

author: Freedman, J.

license: Public Domain

text:
    ELLEN REARDON, an infant, by guardian, Respondent, v. THE N. Y. CONSOLIDATED CARD CO., Appellant.

      Master and servant—Negligence and contributory negligence—Hule as to machinery—exception in favor of youth, &e.—violation of statute.

    In an action by an employee to recover damages for an injury received from a machine which such employee had to operate in the service of the employer, the employee must affirmatively establish: 1. That the machine or appliance was defective; 2. That the master had knowledge or notice, or ought to have known of the fact; and 8. That the servant did not know, and had not equal means of knowing with the master.
    The rule is not rigidly enforced against persons who are too young in years, . and too inexperienced in the service, to appreciate the dangers to which they are exposing themselves, especially if the employer permits the danger to exist in violation of the. statute law.

      Decided December 11, 1884.
    The rule is not relaxed, however, where the servant, as in the case at bar, although a minor, .is yet 16 years of age and has had an experience of six years in the business, and there is no violation of any statutory provision by the master.
    Where the case made out against the defendant is as consistent with the theory of plaintiffs contributory negligence as with the theory of defendant’s negligence, plaintiff cannot recover.

      Thus, in the case at bar, the injury was caused by the descent of a knife connected with amachine which the plaintiff was operating. This knife was raised and lowered by means of a treadle set in motion by the operator’s foot. The plaintiff had raised the knife and placed her hand under it for the purpose of clearing out the die; while her hand was in this position, the knife came down and injured it. All the testimony showed that with the knife up it was impossible for it to come down until the treadle was put in motion, and that the treadle could not be put in motion by any other part of the machinery. There were no circumstances suggesting any other theory than that plaintiff herself put the treadle in ' motion. Held, that she could not recover.
    Before Sedgwick, Ch. J., Van Vorst and Freedman, JJ.
    Appeal by defendant from a judgment entered in favor of the plaintiff upon the verdict of a jury, and from an order denying defendant’s motion for a new trial.
    The facts sufficiently appear in the opinion.

      Burrill, Zabriskie & Burrill, attorneys ; and John E. Burrill and George Zabriskie, of counsel for appellant,
    on the points decided, argued :—I. The plaintiff failed to show, that she did not have the means of discovering the alleged defect, and equal means of knowledge with the defendant in respect thereto. Servant, in order to recover must establish three propositions : 1. That appliance was defective; 2. That master had notice or knowledge, or ought to have had; 3. That servant did not know, and had not equal means of knowing with master (Loonan v. Brockway, 3 Rob. 74; Wood, Master & Servant, 791; DeForest v. Jewett, 88 N. Y. 265 ; Wright v. N. Y. Central R. R., 25 Id. 562; Hayden v. Smithville Co., 29 Conn.
      548; Mad. Riv. Co. v. Barber, 5 Ohio St. 541; De Graff v. S. B. & N. Y. R. R. Co., 3 T. & C. 255; S. C., 76, N. Y. 125).
    II. The court erred in refusing to dismiss the complaint on the ground mentioned in preceding point, and in refusing to charge on that proposition in accordance with the defendant’s request. This point is sufficient to reverse the judgment (Loonan v. Brockway, 3 Rob. 71-83; Wright v. N. Y. Central, 25 N. Y. 562; DeForest v. Jewett, 88 Id. 265).
    III. But in fact, there was no evidence to show, that there was any defect in the machine ; or that the machine was defective in construction. See the distinction between a defect in the construction of machine and its getting out of order or becoming defective by use (De Graff v. N. Y. Central, 76 N. Y. 125).
    IV. There was no evidence that the machine was dangerous, or was in a dangerous condition at the time of the accident. Yor any evidence offered to show, that the defendent had any knowledge of the alleged dangerous condition of the machine, or that it was called upon or neglected to remedy it, or declined or neglected to have it remedied (Devlin v. Smith, 89 N. Y. 170; Loonan v. Brockway, 3 Rob. 74; Wright v. N. Y. C. R. R. Co., 25 Id. 562 ; Owen v. N. Y. C. R. R., 1 Lans. 108).
    V. Plaintiff testified : “I have to keep my foot on the treadle all the time, in order to make the machine work, and if I take my foot off the treadle, the knife stops; so the knife does not move at all, unless I keep my foot on the treadle all the time.” The injury, therefore, was not occasioned by any defect or disorder in the machine, by the knife sticking in the die, or by the shaving or the removal of the shaving, but was occasioned by the knife’s coming down while her hand was under it; and the knife could not have come down unless she had put her foot on the treadle.
    VL The court erred in refusing to dismiss the complaint, because the plaintiff had not shown negligence on the part of the defendant, or the absence of contributory negligence on her part (Reynolds v. N. Y. Central R. R. Co., 58 N. Y, 248 ; Cordell v. N. Y. Central R. R. Co., 75 Id., 332).
    VII. The charge that the fact of infancy of the servant or operator affected the question of defendant’s liability, was erroneous (De Graff v. S. B. Co., 76 N. Y. 125 ; Evans v. Lake Shore Co., 12 Hun, 289 ; Sullivan v. India Mfg. Co., 113 Mass. 396).

      John D. Townsend, attorney, and of counsel for respondent,
    on the points decided, argued :—I. No error was committed by the refusal of the judge to dismiss the complaint at the close of the testimony. The plaintiff had shown that the machine at the time of the accident was both out of order and defective. There was undisputed testimony then that the action of the knife in coming down upon her hand on the occasion when the accident occurred, was an indication of disorder in the machine which had never developed before. It had been shown by undisputed testimony then, that the defendant knew that the machine had been out of order for two months at least, and that the plaintiff had frequently complained to the defendant, through its agents, that she could not work it properly. Daniel Cashin, a superintendent of the defendant, and called by him as a witness, had, at this time, confirmed the statement of the plaintiff that the machine was out of order, and that she had made frequent complaints to him and the defendant’s machinist in regard to it. Some evidence at the time this motion was made, had been presented on the part of the defendant which, if credited, might tend to show some negligence on the part of the plaintiff, but there was no evidence which established such unmistakable negligence on her part as would justify the judge in taking the case from the jury (Stackus v. N. Y. C. & H. R. R. R. Co., 79 N. Y. 464-466 ; Hawley v. N. C. R. R., 82 Ib. 370 ; Ochseinbein v. Shapely, 85 Ib.
      224 ; Dowling v. N. Y. C. & H. R. R. R. Co., 90 Ib. 670 ; Palmer v. Dearing, 93 Ib. 7).

    II. There was no error in charging the jury in effect “ that more care should be expected from a master in providing machinery, and the supervision of it, when he employed young persons and women to work it, than when he employed male adults.” The evidence shows that the plaintiff, at the time of the accident was seventeen years of age (Omeno v. The Hud. R. R. R. Co., 38 N. Y. 445 ; Prendergast v. N. Y. C. & H. R. R. R. Co., 58 Ib. 652; Thurber v. H. B. M. & F. R. R. Co., 60 Ib. 327; Kain v. Smith, 89 Ib. 375, 384 ; Dowling v. N. Y. C. & H. R. R. Co., 90 Ib. 670).
   By the Court.

Freedman, J.

The action is for a personal injury. The plaintiff’s amended complaint alleges : (1) That the plaintiff was at the time of the injury, in the employ of the defendant as an operator on a card cutting machine; (2) that such machine was out of order at the time, as was well known to the defendant, and was in a condition dangerous to be used ; (3) that without negligence on her part and without knowledge that the machine was defective, she was injured by a knife connected with the machine; and (4) that such injury was caused by the negligence of the defendant in furnishing to plaintiff, while so employed, a machine without proper protection against danger.

The answer put in issue all the material allegations of the complaint and set up that whatever injuries plaintiff sustained were the result of her own negligence and the negligence of her fellow servants.

At the trial, the evidence showed that the plaintiff, who, at the time of the injury was about sixteen or seventeen years of age, had at that time been in the employ of the defendant in its card manufactory for about six years, and at work on the particular machine complained of for about six or eight months, and that she was fully acquainted with its operation and competent to operate it. The machine in question cut cards from card strips cut by another machine, and the strips were passed by the plaintiff into the machine in question, through rollers which drew each strip under a Imife or punch which moved vertically. The machine was operated by steam, and power was supplied from the main shafting by means of a fly-wheel. The machine was started by plaintiff putting her foot on a treadle which connected the wheel with the vertical knife. It was stopped by plaintiff taking her foot off the treadle when the knife became disconnected and the wheel continued to revolve without moving the knife. In operating the machine it sometimes happened that the Imife got stuck' and tore the cards, and then it became necessary to get the pieces of torn or broken cards out from under the knife before plaintiff could continue her work. So far there was no dispute as to the facts.

The plaintiff then went on and showed that she had repeatedly extracted with her fingers, bits of torn cards from the machine, and the knife on such occasions had always remained stationary after she had raised it. On the occasion complained of, the knife got stuck, plaintiff raised it, and thereafter, while plaintiff was engaged in extracting torn cards, the knife came down without any apparent cause and severely injured her right hand. She also testified that she had on one or two prior occasions complained to the superintendent and the machinist of defendant’s factory that the Imife would stick and in consequence thereof spoil her work, and that she had been told to do the best she could. This was the full extent of any complaint ever made by the plaintiff to any one.

On the part of the defense it was shown, among other things, by a number of witnesses that the machine was a suitable, proper and safe one for the work required to be done by it; that a large number of similar machines had been operated in the same room for a number of years and by a large number of girls and women, and that no accident beyond the scraping of a finger nail in one or two instances had ever occurred to any one in the course of their work; that, whenever a knife got stuck, it was not in consequence of any defect in the machine, but either because the knife got dull and for that reason would tear the cards, or because the operator did not feed the card strips in properly and squarely and in the right direction; that all the operators were from time to time warned to be careful, and that in case a knife got stuck, the duty of every one of them was to call a certain machinist who was on hand in the room for the purpose of' freeing the knife and seeing to it that the machine should work properly, and who, whenever thus called upon, did free the knife and did every thing else which was necessary to be done to make the machine run properly ; that the sticking of the knife in the machine operated by the plaintiff on the day of the injury, was caused neither by the defect nor ’ by want of repairs in the machine, for the machine was, on examination both before and after the injury to the plaintiff on the day in question, found in perfect order and required and received no repairs ; that the plaintiff had never at any time made any other complaint concerning the machine than that the knife would stick and spoil her work ; that the same machine had been used by the plaintiff for more than a week previous to her injury without any difficulty or complaint whatever ; that on the day of the injury, when the knife in plaintiff’s machine got stuck, the plaintiff neglected to call the machinist whose duty it was to free it and to look after the machine, but undertook to do these things herself, contrary to her instructions and duty in the premises ; that as soon as the operator’s foot is taken off the treadle of such a machine, the machine is thrown out of gear and the knife, if up, cannot possibly be made to descend except by setting the treadle in motion again, and that consequently the plaintiff must have set the treadle in motion again, after she had stopped the machine, and thus made the knife to come down while her hand was yet under it.

In addition to all this, there was evidence given by several girls, co-servants of the plaintiff, to the effect, that at the time of the injury there was some skylarking going on between a girl named Maggie Haulton and the plaintiff, in consequence of which plaintiff failed to give proper attention to her work, and that on the happening of the injury Maggie Haulton exclaimed that it was her fault.

Upon a careful review of all the evidence on both sides, I have satisfied myself that both upon the question of defendant’s negligence and the question of plaintiff’s contributory negligence, the preponderance of the evidence is in favor of' the defendant. There is no evidence of any defect, unless the tendency of the knife to get stuck was one, and that, it seems to me, was not so much a defect as a contingency which was to be expected and for which the plaintiff should have been on the watch and guard. But if it did constitute a defect of which the defendant had notice, it was one concerning which the plaintiff had equal, if not better knowledge. In such a case the master is not liable, for while the rule that the master is bound to furnish suitable and safe machinery is well established as a general proposition, it is equally well settled, as an exception to the rule, that the master may, as against his servant, choose his own appliances, and that if the risk be apparent, the servant assumes it (White v. Sharp, 27 Hun, 94, recently affirmed by the court of appeals; Gibson v. Erie R. R. Co., 63 N. Y. 449).

Consequently in order to recover in such a case the servant must establish three propositions, viz :

(1) That the machine or appliance was defective ; (2) that the master had knowledge or notice or ought to have known; and (3), that servant did not know, and had not equal means of knowing with the master (Loonam v. Brockway, 3 Rob. 74 ; Wright v. N. Y. Central R. R. Co., 25 N. Y. 562 ; De Graff v. N Y. C. & H. R. R. R. Co., 76 Ib. 125 ; De Forest v. Jewett, 88 Ib. 264 ; White v. Sharp, 21 Hun, 94).

This doctrine has been uniformly upheld in England and in America since the case of Seymour v. Maddox (5 Eng. L. & E. 265), where the proprietor of a theatre v/as sued by an actor for injuries sustained by insufficient lighting of the stage, and falling through an open trapdoor. The court held that the actor could not recover, because he voluntarily exposed himself to the danger, of which he had the same knowledge as the defendant himself.

Thus, in Hayden v. Smithville Manufacturing Co. (29 Conn. 548), the court explicitly declared as follows : ‘ ‘ Every manufacturer has a right to choose the machinery to be used in his business, and to conduct that business in the manner most agreeable to himself, provided he does not thereby violate the law of the land. He may select his appliances and run his mill with old or new machinery, just as he may ride in an old or a new carriage, navigate an old or new vessel or occupy an old or new house, as he pleases. The employee, having knowledge of the circumstances, and entering his service for the stipulated reward, cannot complain of the peculiar tastes and habits of his employer, nor sue him for damages sustained in and resulting from that peculiar service. .... An employee, having knowledge, cannot claim indemnity except under particular circumstances. He is not secretly or involuntarily exposed, and likewise is paid for the exact position and hazard he assumes ; and so he may terminate his employment, when, from unforeseen perils, he finds his reward inadequate or unsatisfactory.”

It is true the rule is not rigidly enforced against persons who are too young in years and too inexperienced in the service to appreciate the dangers to which they are exposing themselves (Coombs v. New Bedford Cordage Co., 102 Mass. 572 ; Laning v. N. Y. Central R. R. Co., 49 N. Y. 521). And especially if the employer permits the danger to exist in violation of the statute law (Britton v. Great Western Cotton Co., L. R. 7 Exch. 130).

But in the case at bar, no such reason exists for relaxing the rule. The defendant violated no statutory provision, and the plaintiff, though only sixteen, or. seventeen years of age, had an experience of six years in the business. The case, therefore, comes fully within the decision of the court of appeals in De Graff v. N. Y. C. & H. R. R. R. Co. (76 N. Y. 125), where it was held that the fact that the employee is a minor, does not, if he is of age sufficient and is competent for the service in which he is employed, affect the duty or the liability of the employer to him ; that the risks and dangers incident to the business are an element of the employment, and the employee cannot claim, on account of infancy, to be relieved from the consequences of such risks or dangers.

In the next place, plaintiff’s injury was rot the natural consequence of the sticking of the knife. If that was a defect, it was cured by the plaintiff herself before she put her hand under the knife. According to her own showing she ran the knife up and then stopped its movement by taking the foot off the treadle. The machine then was as harmless as a sewing machine. For all the testimony including that of the plaintiff upon this point is to the effect that as long as the treadle was not put in motion again, the knife could not come down again, and that the treadle could not have been put in motion again by some, other part of the machinery. The knife, however, did come down again, and, in the absence of any other explanation, it must be assumed that its downward motion was caused by the plaintiff putting the treadle in motion again while she still had her hand under the knife. In the nature of things, no other conclusion can be reached, in the absence of proof of some circumstance, no matter how slight, suggesting some other theory, and no such proof is in the case. Where, then, was the negligence of the defendant which caused the injury and which the plaintiff was bound to point out and to establish by a preponderance of proof ? The burden was on her throughout to establish by a preponderance of evidence that the injury complained of was the result of defendant’s negligence, exclusive of any other primary cause. This is too familiar a rule to require the citation of authorities in its support. To say the very least, therefore, the case made out against the defendant was as consistent with the theory of plaintiff’s contributory negligence as with the theory of defendant’s negligence, and in such a case it is well settled that the plaintiff cannot recover (Cordell v. N. Y. C. & H. R. R. R. Co., 75 N. Y. 330 ; Desmond v. Rose, 46 Super. Ct. 569 ; Glendening v. Sharp, 22 Hun, 78).

For the reasons stated, I am of the opinion that the defendant, at the close of the evidence on both sides, was entitled to the direction of a verdict in its favor, and that the denial of the defendant’s motion in this respect constituted error.

Other interesting and grave questions are presented by the exceptions taken by the defendant to the charge and to the refusal of the court to charge certain requests, but as the examination already made calls for a new trial, it is unnecessary to notice or discuss them

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

Sedgwick, Ch. J., and Van Vorst, J., concurred.


text:
    PETER LORE, as Administrator, &c., Appellant and Respondent v. CATHARINE DIERKES and JOHN DIERKES, Appellants and Respondents.

      Executors and Administrators.—Setting aside transfers made by deceased person under Laws 1868, eh. 314—in whose favor set aside—form of ¡judgment—parties to action.—Fraudulent transfer—unla/wfulpostgjonement— rents, accounting for—preference of payment to transferee.

    A transfer by a person deceased, may under ch. 314, L. 1858; be set aside by his executor or administrator, for the benefit of such persons as could, in the life-time of the deceased, upon obtaining judgment, have set it aside as being fraudulent as to creditors, and upon the grounds on which said persons could have set it aside. Such setting aside will inure to the benefit of none but such creditors, and can only be had when it is shown that there is at least one such creditor.

      Where the deceased could himself, in his lifetime, have set aside the transfer as having been obtained from him by fraud, or undue influence, etc., the executor or administrator may set it aside upon the grounds on which he could have so done. Such setting aside will inure to the benefit of legatees, distributees, or next of kin.
    Where the transfer is set aside for the benefit of creditors, the judgment should appoint a receiver with such powers as are requisite; it should also appoint a referee, and should direct the administrator or executor to give the usual administrator’s and executor’s notice for presentation of claims as required by law; it should require the administrator or executor to present to the referee the claims presented to him under such notice, and to prove them, or to notif)r the claimants of the proceedings and require them to present and prove their claims before the referee: it should give the referee power to pass on the validity of the claims and whether they are entitled to share in the proceeds of the transferred property ; it should direct that so much of the fund as is necessary to cover the claims of those creditors who are entitled to share in it, should be paid by the receiver to the administrator, who shall pay it, pro rata, to such creditors; and should direct the surplus to be paid to the transferee.
    The husband of the transferee who has no connection with the transfer, or the property, other than residing on the transferred property with his wife and the transferer, is not a proper party to an action to set aside the transfer.
    A beneficiary under the transfer, whose rights may be protected by the judgment without injury to others, although a proper, is not an absolutely necessary party to such an action; but when the judgment must necessarily bar and destroy his rights he is a necessary party.

    A transfer which provides for the payment to creditors of the sums due them without interest, in quarterly sums, payments not to commence or be required, until one year after the decease of the transferer, the transferer having no other property, is fraudulent as to creditors and void.
    The transferee in such case, cannot be called on to account for rents at any earlier date than that of the disaffirmance of the transfer; nor for those received afterwards, if the corpus of the transferred property is sufficient to pay those creditors who are entitled to be paid out of it.
    The transferee is not entitled to priority on a claim as to which, aside from the transfer, he is a mere general unpreferred creditor entitled only to a footing with other creditors. But he is entitled to priority of payment for money disbursed by him in and about the care and protection of the transferred property where his guilty participation is constructive rather than actual. Davis v. Leopold (87 Jf. Y. 620), distinguished,-

      Decided December 22, 1884.
    Before Sedgwick, Ch. J., and Ingraham, J.
    Appealed hy both parties from a judgement entered upon decision of a judge at special term.
    The facts sufficiently appear in the opinion.

      Cook & Shuck, attorneys, and of counsel for plaintiff,
    argued :—I. The facts in this case fully sustain the judgment and decree setting aside, as fraudulent and void, the instrument complained of (Young v. Heerman, 66 N. Y. 374 ; Union Nat. Bank v. Warner, 12 Hun, 306). Defendants claim, that all the relief the plaintiff was entitled to, if any, was a judgment and decree that the defendants should satisfy any debt against the deceased which should be proved at the trial. Before the act of 1858, and even yet, a creditor was and is only allowed to attack a fraudulent assignment or conveyance, so far as it prejudiced his rights, and he could only recover the full amount of his claim and nothing more. But by the statute of 1858, an administrator and other trustee is empowered to treat as void all transfers, &c.- made in fraud of the rights of creditors and others. It is a also well settled principle of law that a conveyance which is void in part because it hinders, delays or defrauds creditors is void intoto. The fraudulent intent of a part of the instrument vitiates the whole, thereby rendering it void (Wait’s Actions and Defenses, Vol. III. 470 ; Hyslop v. Clark, 14 Johns. 464). A deed fraudulent in fact is absolutely void and is not permitted to stand for any purpose (Davis v. Leopold, 87 N. Y. 622). Any doubt on the subject is removed by section 2 of the act of 1858, by which an administrator is authorized by action to recover not only the estate so fraudulently transferred, but its whole value, in case the estate cannot be recovered, with all damages, from every person who-shall have taken such estate in fraud of the rights of creditors and others. Formerly an administrator could not question the fraudulent transfer of a deceased person whose representative he was. He was not allowed to attack or impeach the honesty or good name of his predecessor (probably from reasons of public policy), and after the decease only a judgment creditor could attack a fraudulent transfer. The deceased in his lifetime was not allowed to ask a court to set aside a fraudulent transfer made by him because he was a party to the fraud. But the law of 1858 changes the old rule entirely, for it not only authorizes but makes it the duty of an administrator to disaffirm and declare fraudulent and void all such transfers, and authorizes him to sue for and recover the estate so transferred or the value thereof. The plaintiff was not in a condition to prove all the debts that existed against the estate of the deceased. Nor was he bound to do so. It was enough to prove the existence of one or more debts for the purpose of setting aside the instrument complained of. The law fixes the means of ascertaining the debts of a deceased.
    II. John Dierkes was a proper party defendant. The proof shows that after the decease of Philip Lore both defendants went into possession of the premises under the assignment, and, have ever since been in such possession. Before the suit was brought a notice is served on both defendants by the plaintiff, wherein the assignment is disaffirmed, and possession of the premises demanded, which demand was refused. This notice served on the defendants was produced by them on the trial, under notice to produce and put in evidence by plaintiff, though they denied the service on them thereof in their answer. In the 5th paragraph of their answer they admit that they are in possession of said premises. The complaint charges that the defendants wrongfully withhold the premises from the defendant.
    • III. The plaintiff claims that the judgment below is correct, except that part, and from which he appeals, which directs the sums of $1,850 and $500 to be paid to tire defendants, with interest. During the trial it appeared that the deceased was indebted to the defendants in the sum of $1,850, and that after the making and delivery of the assignment complained of, $500 was paid off on account of a $4,500 mortgage, a hen on said premises. It appears by the evidence that the said sum of $500 was paid off during the lifetime of Philip Lore, and there is no proof whatever that the defendants paid that sum. The court below found that the defendants participated in the fraud and accepted the fraudulent assignment with full knowl.edge. The judgment directing the payment to the defendants of the sums named, is in direct conflict with the rule laid down in Davis v. Leopold (87 N. Y. 620), ■ viz : That a grantee who is a party to a fraud is not entitled to protection for any sum paid or liability incurred. The conveyance is absolutely void, and is not allowed to stand as security for any purpose of indemnity or reimbursement. The learned court below were probably led into this error by the decision in the case of Van Wyck v. Baker (16 Hun, 168). On examining that case it will be found that the grantee there was innocent and did not know of or participate in the fraud, and it was held there that a court of equity would treat the conveyance, as to him, as a security only. A similar ruling was made in Pond v. Comstock (20 Hun, 402).
    IV. It is conceded in the case that the defendants since the death of Thomas Lore, have been in possession of the premises in question, and have received the rents for the same. All of this has been declared by the judgment of this court to be wrongful, and yet the court below has omitted to adjudge that the rents thus collected by the defendants should be accounted for and paid over to the plaintiff. This was also error.

      Henry F. Lippold, attorney, and Emile Beneville, of counsel for defendant,
    argued:—I. Section 1 of chapter 314, laws of 1858, provides : “ That any executor, administrator, receiver, assignee, or other trustee of an estate, or the property and effects of an insolvent estate, corporation, association, partnership or individual, may, for the benefit of creditors, or others interested in the estate or property so held in trust, disaffirm, treat as void, and resist all acts done, transfers and agreements made, in fraud of the rights of any creditor, including themselves and others, interested in any estate or property, held by or of right belonging to, any such trustee or estate.” The title of the act is : “ An act to declare and extend the powers of executors, assignees, receivers and other trustees, and to protect the rights of creditors and others against fraud, and for other purposes.” The object of the statute and the extent of its application are clearly defined in the title. Prior to the enactment of this statute, neither executors nor administrators had the right, or could, by any judicial proceeding, question, impeach or avoid the acts or transfers of deceased testators or intestates, even when those acts and transfers were made with the purpose and intent of defrauding creditors. The only persons who could impeach, or in any manner attack such fraudulent transfers, were such as had recovered judgments upon their claims, the collection of which was likely to be hindered, delayed, etc., by the said transfers (3 R. S. Banks’ 6th ed. 145). It is true that by 2 R. S. 449, § 17, an action was already given to executors and administrators to protect estates of deceased persons, but such actions were confined to cases where a person had taken or interfered with the property or effects of the deceased, and such interferers were declared to be responsible as wrongdoers to the executors, etc., for the value of any property or effects so taken or received, and for damages, and on the theory that the personal representatives held the position of trustees to the judgment creditors of the deceased, they were permitted to question fraudulent conveyances, etc., which he had made in his lifetime (Moseley v. Moseley, 15 N. Y. 336 ; Bates v. Graham, 11 Ib. 237). The object of the statute of 1858 was then, 1st. To give simple contract creditors the same rights with those who had recovered judgment on then claims (Southard v. Benner, 72 N. Y. 424) ; and 2d. By giving to executors, etc., a statutory right to property fraudulently conveyed, to permit them to impeach any act or transfer calculated to defraud creditors, etc., and others interested in the estate, by a proper proceeding brought for that purpose. To this extent only does the statute go. It is creditors, and only creditors, and persons standing in the position of quasi-creditors, or having vested or contingent interests in the estate, who can be included in the language of the statute, “others interested in the estate or property,” who are benefited by the statute. The person, therefore, who can claim the benefit of the act must be some one having a direct personal claim or demand against the person whose act, grant, deed or devise is sought to be impeached, or at any rate, some claim or right either vested or contingent in the transferred estate, existing, independent of the volition or power of the grantor, assignor or deceased, and whose said act, deed, transfer or devise was calculated to defeat, hinder, or injuriously affect the said claim, interest or demand—in other words, the transfer, actor devise must be “in fraud of ” such rights. Now, the questions arise : Are heirs at law, next of kin, or personal representatives, persons who come under the designation of “ others interested in the estate,” as used in the statute? And, can a person, absolutely owning property, commit any fraud on his next of kin, etc? It will not be disputed that a person owning property has the absolute and uncontrolled right to dispose of it as he pleases, so far as his descendants are concerned—no child, parent, relation or next of kin, has any right or claim therein. All property is subject to the absolute disposition of it, by its right owner, limited only by the liability to be used to pay bona fide demands of creditors, or those of persons having claims or rights therein, prior or superior to those of the owmer himself. He may, therefore, give it away without consideration, or devise, or make whatever disposition of it that seems to him. best, regardless of his next of tin or heirs at law, and such disposition is controlled only by the duty that in so disposing of his property, he shall not injure others who have legal claims against him. The next of tin certainly would never be heard to question, in a court of justice, any transfer of property which an owner might have made of it in his lifetime. If they cannot do this in the lifetime of the owner, then certainly the fact of his death will not cause rights to spring into existence, which never existed before. What interest or right, then, can the next of kin of any person be said to possess in the property or estate of such person ? Clearly none in Ms lifetime ; and after his death, only such as are given to them by the statute, in the absence of a testamentary disposition. Then, and not till then, does then mterest begin, and only m such property as to which the ancestor died intestate. It is well settled that when a person makes a voluntary conveyance of property, such conveyance is in every case valid' where it does not break in upon the legal rights of others. As to the grantor or his personal representatives, such a conveyance is absolutely good and ummpeachable. Only creditors or persons having legal rights against the grantor or the property, will be heard to impeach such a conveyance, and they only to the extent in wMch it may be necessary to deal with the conveyed estate for their satisfaction. To tMs extent, and to tMs only, it is treated as if it had not been made. For every other purpose, and as against every other person, it is good. In the language of Judge Story, “ Satisfy the creditors and the conveyance stands ” (Story Eq. Juris. § 361, 5th ed. ; Jackson v. Garnsey, 16 Johns. 189 ; Seward v. Jackson, 8 Cow. 406 ; Drinkwater v. Drinkwater, 4 Mass. 354). The rights of the next of tin, &c., are those of the ancestor; they stand m Ms shoes; what he would have done, they may do ; what he would not do, they shall be barred from doing. To argue, therefore, that after a transfer of premises, valid as agamst the grantor, his next of kin or heirs-at-law, are interested in such transferred premises, or that by such tranfer valid as against a grantor, they were defrauded of any right, would seem to be a mere waste of words. It is then evident, that in the case at bar, only such persons as could have established a legal claim against the deceased assignor or against the property assigned, could have successfully assailed the assignment, and a judgment finding no debt due by the assignor unpaid, and yet directing the proceeds of the property realized at the sale, after payment of costs and the defendant’s debt, to be paid over to the administrator (evidently for the benefit of the next of kin), is manifestly wrong and should be set aside ; even if the alleged claims had been valid, the proceeds remaining after they were satisfied should have been directed to be paid to the assignee and appellant (Van Wyck v. Baker, 10 Hun, 39).
    II. The court should not have rendered final judgment in the action, all the parties interested in the premises, under the assignment to defendant, Catherine Dierkes, not being before the court.
    III. The judgment should certainly be reversed as to the defendant John Dierkes. Not a word of testimony was offered against him, in no way has he been implicated in the transaction, the transfer was not to him, he received no benefit from it, and had no interest of any manner or kind in the premises. As well might the -decree have been against an entire stranger, as against the defendant John Dierkes.
    IV. The plaintiff’s exception to the court’s refusal to find, and direct, that the defendants should account for all rents received by defendants since the death of Philip Lore, the grantor, is not well taken. The assignment was valid between the parties, and no creditor, not having a lien, had any right to, or interest in the rents (Robinson v. Stewart, 10 N. Y. 197).

       The opinion does not suggest what provision should be contained in the judgment when the transfer is set aside in favor of devisees, distributees, or next of kin, but it would seem in such case to be sufficient to divide the whole proceeds, after providing for the payment of such claims as have priority, to be paid to the plaintiff to be administered upon according it to law.

   By the Court.

Sedgwick, Ch. J.

The action is brought by plaintiff as administrator of the estate of Philip Lore, deceased, to set aside a transfer of leasehold property by him in his lifetime to defendant Catherine Dierkes, as fraudulent to the creditors of the intestate. The court found upon sufficient testimony, that at the time of the transfer, the intestate was indebted to one Philip Baum, in $637, as evidenced by a promissory note payable on demand, and also to one Frederick Luxinger, in $300, which was due. This last indebtedness may be dropped from the case, except as a piece of testimony on the issue of fraud, as the plaintiff admitted upon the trial, that the amount due to Luxinger had been paid since the action was begun, and the judgment could not provide for his being again paid out of the property. The transfer of lease and the term, was to have and hold the same, subject “to the payment of the following named sums to the persons hereinafter named, at the time and in the manner following, but without any interest thereon; that is to say, the sum of $636 to Philip Baum, husband of my daughter Elizabeth, and the sum of $300 to my son-in-law Frederick Luxinger, in quarterly installments, to each of them respectively, of not less than $75, such payments not to commence or be required until after the lapse of one year after my decease.” As the effect of this transfer was to postpone, for a definite time, the application of the property to the satisfaction of the debts, it was fraudulent as to the creditors, who had a right to an immediate application. The provision that the charges should not carry interest was fraudulent. The finding that the assignment was fraudulent was correct, the judge also finding that the intestate, at the time of the transfer, had no other property than the lease referred to.

This, however, mast be confined to indebtednes existing at the time of the transfer. There was no proof that any indebtedness was incurred by the intestate after the transfer, and no proof was given of any intent to defraud subsequent creditors if there had been any.

Before the transfer, the intestate had made a bond, evidently intended at the time, to be for the benefit of the creditors that have been named, and also, to secure the bond, a mortgage upon the leasehold afterwards assigned. One of the mortgagees was the defendant Catherine Dierkes to whom the intestate was indebted in the sum of $1,800. If this had been an effectual security for the indebtedness due to Philip Baum, it would make a serious question as to the fraudulent character of the transfer in this action. In fact, however, Philip Baum was not secured, as the bond and mortgage was to Elizabeth his wife. Catherine Dierkes claimed under thé transfer to her and not under the mortgage. Contemporaneously with the transfer, the intestate made a declaration, that the mortgage had been made by mistake and had never been delivered, although it had been recorded, and he declared that he therefore canceled it. There is nothing connected with the mortgage that tends to show that the transfer in question was not fraudulent.

The next question concerns the amount or quantity of the recovery; that is, the judgment that was recovered. It adjudged that the premises be sold by a receiver, and that from the proceeds, after specified deductions of expenses and costs, the receiver “ pay to the defendants the sum of $1,800, with interest, and the further sum of $500, with interest, and that said receiver pay the balance of all moneys remaining in his hands, to the administrators who may be appointed by the surrogate of the estate of Philip Lore, hereafter to be appointed.” Specific attention will be given to the provision as to $500. The plaintiff has received letters of administration, but the surrogate had ordered, the the authority of the within named administrator is hereby limited, so that while allowed to prosecute the action brought by him in the superior court, he is forbidden to receive the avails of any judgment he may recover therein.”

From this judgment both parties appeal. The plaintiff objects to it, that as he requested the judge to direct judgment that plaintiff have an accounting of all rents and profits, and that plaintiff recover all rents collected by the defendants, and excepted to the refusal to direct such a judgment, it should be modified in the respects adverted to. I am of opinion that the plaintiff was not entitled to an account of the rents received by the defendant, at any earlier date, at least, than that of the disaffirmance of the transfer, or to a recovery of their amount. The request was therefore, incorrect, in part at least, and the judge was justified in not acceding to it. It was not, furthermore, necessary to the satisfaction of any indebtedness of the intestate, that resort should be had to the rents. The property in question had a value of at least $5,000, to be applied to debts, that were not nearly so great in the aggregate, so far as the evidence disclosed, and any provision as to accounting ' for rents should have been conditioned that the proceeds of the property were not sufficient to pay the claims.

The plaintiff further urges that the provision for payment to the defendant of the sums of $1,800, and $500, was erroneous, on the ground that the defendant can take no benefit or keep any indemnity, through the operation of an instrument that is fraudulent, she having notice of its character. At any rate, it seems to be clear that she can get no benefit through the operation of the instrument as such, whether she took with notice or not. The judgment gives her priority, as to the $1,800, out of the proceeds. Apart from the transfer to her, which is void because fraudulent, she was a general unpreferred creditor, entitled only to a footing with other creditors. Her claim to a preference, then, can only rest upon the operation of the transfer. As this is void, the claim must fall. But as a creditor, she is entitled to her share of the estate, in the course of administration, as much as any ' other creditor. This does not come through the impeached transfer. It would exist, if there were no transfer.

In view of the case of Davis v. Leopold (87 N. Y. 620), it is necessary, in order to consider properly the claim to be paid the $500 out of the proceeds, before payment to the plaintiff, to ascertain, if within the meaning of that case, she was guilty of participation in the fraud, in such a sense as to deprive her of her right to be indemnified for money paid on the mortgage subject to which she took the conveyance. On the findings and the whole case it appears, that Catherine Dierkes had not an actual intent to defraud creditors in any other sense, than that an intent to defraud must be charged upon her, because of a presumption that she knew the law and was chargeable with intending the consequences of the assignment, even if she had neither of these matters in her mind. Her guilt was constructive rather than actual. In such case, it would not be inequitable or illegal to allow her for an amount of money which she paid on an existing mortgage, and which payment increased the value of the equity of redemption in a peculiar way. If she had bought the mortgage she could have enforced it, and equity can consider her as entitled to an interest in the mortgage corresponding to the amount she paid upon it. In this regard her claim is superior to that of the plaintiff who represents creditors.

The defendant objects to the judgment,- that it is erroneous in directing that the surplus of proceeds be paid generally and finally to the administrator who may be appointed by the surrogate. In my judgment the objection is valid. The cause of action, is of the kind described by chapter 314, Laws of 1858 (4 Edm. St. 483). The first section provides, that any executor, administrator, &c., may for the benefit of creditors or others interested in the estate, disaffirm, treat as void and resist all acts done, transfers, etc., made in fraud of the rights of any creditor, including themselves and others, interested in any estate or property held by or of right belonging to a.ny such trustee or estate, etc. As upon the disaffirmance of the transfer, the property would be in the transferrer, the section would imply, that the trustee could recover it. It is doubtful whether sucha cause of action is the one intended by the second section, which provides that every person who shall in fraud of the rights of creditors and others have received, taken, or in any manner interfered with, the estate, property, or effects of any deceased or insolvent association, corporation, partnership or individual shall be hable in the proper action to the executor, etc., or other trustees of such estate or property, for the same, or the value of any property or effects so received or taken, and for all damages caused by such acts to any such trust estate. The absence of words that would indicate a reference to the first section, together with the characteristics of the conditions described by the second section, suggest that the second section in the case of executors and administrators refers not to property that has been transferred by a person in his lifetime, but to property taken or received after the decease. For the purposes of the point in view, it will not be necessary to determine whether the two sections have different aspects.

The counsel for the plaintiff insists, that the transfer may be disaffirmed for the benefit of others than creditors ; viz., such as are interested in the estate, like heirs or distributees. This, however, is not of so much importance as is the thing that may be disaffirmed: The administrator can disaffirm only transfers made in fraud of creditors and others interested in the estate or property. The proposition does not need discussion that an instrument which transfers the whole property of a person to one of those who are his next of kin, and would upon his death become his heirs or distributees, to the exclusion of the rest, is not a fraud upon them. The transferer has no obligation to any of his next of kin, in such a matter. Although the instrument may be fraudulent as to creditors, the next of kin, or their representative, cannot avoid it. The representative of the next of kin, or rather the administrator, avoids it in behalf of creditors. Such an avoidance, cannot result in favor of those for whom it cannot be avoided but against whom it is vested. 1 therefore, think that the judgment was erroneous, in so far as it did not limit the application of the proceeds of sale, to the claims of creditors.

In my opinion, there. should have been made in the judgment, provision,- that after the payment of claims of creditors, the surplus should goto ihe fraudulent assignee. This' would be the result of recognizing that a fraudulent transfer is valid between the parties to it, although it may be avoided by parties defrauded by it. The case of Bostwick v. Menck (40 N. Y. 383), declares this as to a plaintiff, a receiver, in supplementary proceedings, representing creditors, in the kind of way that the present plaintiff represents them. It was there said : “It is clear that the right of the receiver representing creditors and acting in their behalf, is no greater than that of the creditors. What then are the legal and equitable rights of a creditor as to property fraudulently transferred ? Manifestly, only to treat as void and set aside such transfer, so far as shall be necessary to satisfy his debts and costs. He has no light to interfere with the transfer beyond this. When his debt and costs are paid, the transfer is as valid as to him, as to other persons.” It was held that the plaintiff was only entitled to judgment for the amount of the judgment upon which he had been appointed receiver, and certain expenses.

In Bostwick v. Menck, the plaintiff did not represent all the creditors of the fraudulent assignor, in solido. He represented only those, in whose behalf he had been appointed. The plaintiff in this case represents them all, to a certain extent. Some of them, may be at present unknown. In such a suit, as this, the plaintiff must show that there were in fact creditors, although it may not be necessary to show that he has proved who were all the creditors. A creditor’s bill presents an analogous case, The court can use due measures to protect unknown creditors, while it also uses due measures to provide for the contingency of there being no other creditors than such as have appeared and proved their claims. Thompson v. Brown (4 John. Ch. 639), specifies the different cases, in which unknown creditors have been called into proceedings in suits essentially like this action, and such creditors as have hot appeared and proved their claims, have been bound by the adjudication. The case referred to is, with others of a similar kind, cited in Kerr v. Blodgett (48 N. Y. 62). This last case shows that the person bound to distribute funds among all creditors, will be protected by a judicial accounting against the claims of creditors, who are not known to the trustee to claim to be creditors, and who have omitted, without fault on then part, to prove their claims in the proceedings.

The fact, that to entitle creditors to a distributive share in the estate, it is enough if they present their claims within six months from the first publication of notice to present claims, has not been lost sight of. If necessary, it would be appropriate to consider whether they might not be bound, for the purposes of this action, by a notice of less than six months. This necessity may be avoided by making the notice to be such as the administrator shall give as required by law, requiring him to present in this action, claims presented to him under the notice, and to prove them, or to notify the claimants of these proceedings, and requiring them to present and prove their claims, before the referee who must be appointed in the judgment. It will be noticed that this provides for the contingency of the administrator’s notice having been published for six months before the judgment is entered.

The referee should not allow as claims upon the proceeds, any that are founded upon indebtedness that arose after the fraudulent transfer. Such part of the fund as is for the benefit of creditors, should be paid by the receiver into the hands of the administrator, who should pay it, pro rata, to the creditors who would be entitled, under the judgment. It may happen that every creditor of the estate is not, for that reason, entitled to a part of the fund. Some may have ratified the assignment, for instance, by receiving a benefit under it. John Luxinger would be such a case, if he received from Catherine Dierkes the indebtedness to him, subject to which the assignment was made to her. The judgment should further provide that the surplus be paid to the defendant Catherine Dierkes.

Mo reason has been assigned why the motion to dismiss the complaint against John Dierkes, husband of Catherine Dierkes, should not have been granted. The action concerned the wife’s separate property, and she might have been sole defendant. The husband had no interest in the property, or obligation in respect of it, or the defense of the action. No claim was proved against him. His admission in the answer, was only that during the intestate’s life time, for some time, he, defendant John Dierkes, lived in a part of the premises with him.

The motion should have been granted, with costs.

One other matter calls for attention. The fraudulent assignment was made subject “to the payment of the further sum of $500 to my son John Lore, to be made in such sums, from time to time, after the lapse of one year after my death, as said Catherine Dierkes in her discretion, shall deem necessary, proper or advisable ; which said last three named sums the said Catherine Dierkes hereby assumes and covenants to pay, as aforesaid, as part of the consideration hereinbefore expressed.” It may be assumed that the plaintiff was not entitled to have the instrument set aside as against John Lore, without making him a party. This objection was not made in the answer or upon the trial or in any way to the court below, so far as the case discloses. It is made on this appeal for the first time, and therefore, should not be sustained for the benefit of the defendants. But the judgment will not bind John Lore or his representatives. The judgment should declare, on its face, that it is made subject to the rights of Lore, and the sale should be made subject to those rights.

The facts of the case intimate that it would be proper to add to the judgment a provision that defendant Catherine Dierkes might purchase the claims of creditors and succeed to their interests in the fund.

If there were no other evidence of fraud, it would be sufficient to modify the judgment as is indicated in the opinion, and as so modified affirm the judgment. It appears, however, that the complaint alleged, that the assignment of the lease was obtained by undue influence and fraud. On the trial the plaintiff offered to prove that the assignment of the lease was “made under undue influence on the part of the defendants with the deceased.” This was objected to by the defendants and the objection was sustained. Plaintiff requested the court to find that such assignment was procured by the defendants, Catherine Dierkes, from the deceased, by undue influence, while he had not full liberty of his actions. The court refused so to find. The statute provides that any executor may, for the benefit of creditors, or others interested in the estate, or property so held in trust, disaffirm, etc., all acts done, transfers and agreements made in fraud of the rights of any creditor, including themselves and others interested, in any estate or property held by, or of right belonging to any such trustee or estate. If, therefore, this assignment was obtained by undue influence, it would not be binding on the assignor, and could be disaffirmed as to him. The property would therefore, by right, belong to the estate. If the assignment was not his voluntary act and, at least, if he or others competent to represent him disaffirmed it, the property it referred to would remain in him, and it could be recovered from the assignee, by the assignor’s administrator. A recovery in such case would be for the benefit of the distributees, as well as of creditors. In that case John Lore would be a necessary party.

If the plaintiff desire to try such issues, he should have the opportunity, and the judgment should be reversed and a new trial ordered, with costs to the defendant Catherine Dierkes. If however, the plaintiff does not insist on that right, the judgment should be modified as directed by this opinion, and as modified, affirmed without costs to either party, on this appeal. The order is to be settled by the chief judge, on notice to all the parties to the action.

Ingraham, J., concurred.


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    HENRY C. DICKSON, Appellant, v. JAMES PHILLIPS, Jr., Respondent.

      Decided December 22, 1884.

      Libel—what constitutes.

    The characterization in a writing of certain acts and statements, therein specified as having been done and made by a person therein named, is a mere expression of the opinion of the writer as to the acts and statements ; and a communication of such opinion to others is not likely to do more than cause them to form an opinion of the acts and statements. Such characterization therefore, is not libelous in itself.
    Consequently, where a complaint sets forth the words of characterization and the acts and statements in reference to which they were used, but neither avers that the acts and statements charged were not done, nor that the statements were untrue, and the acts themselves are not immoral, or unlawful, and do not tend to degrade or injure, a demurrer to it on the ground that it does not state facts sufficient to constitute a causo of action is well taken.
    Before Sedgwick, Ch. J., Van Vorst and Freedman, JJ.
    Appeal by plaintiff from final judgment entered upon demurrer to complaint.
    The action was for damages from an alleged libel. The complaint averred that as a consequence of the libel, his employer had removed him from a place at the head of a department, and had given him notice that his services would not be required after a certain date. The libel as alleged, was contained in letters written by defendant to the employer of plaintiff, and was as follows :
    “Mr. Dickson (the plaintiff) has been for many months past doing unmercantile things—such as telling our customers: ‘To be. sure to get an inside; that we give it and they are fools if they don’t secure it’—and such-like. He, further, takes samples of our cloth and shrinks them, saying our goods shrink and his don’t; also fishes up some odd samples and says, in the same way, that our goods are greasy, &c., &c. This, by carrying about with him such samples, is hardly business-like, and the trade look at it exactly as we do, and tell us of it on every hand; there can be no gainsaying the truth of this, and I might quote much more, but Mr. D. needs no prompting ; he knows of these and other things, such as comments on our men, &c.”
    “ I have had some of the basis of my complaints in person from the trade, and if any exigency existed requiring it, there are others who could be used. All that I could complain of there was your Mr. D. "again treating with men in our employ, after being here sohciting help, &c.—a little unusual proceeding in this section of the country.”

      Edward S. Hatch, attorney and of counsel for appelant.

      Vanderpoel, Green & Cuming, attorneys, and Almon Goodwin, of counsel for respondent.
   By the Court.

Sedgwick, Ch. J.

In Stone v. Cooper, (2 Den. 293), the court of errors, held, that to maintain an action for the recovery of damages, for a false and unauthorized publication, the plaintiff in such action must either aver and prove that he has sustained some special damage from the publication of the matter charged against him, or the nature of the charge itself must be such that the court can legally presume he has been degraded in the estimation of his acquaintances or of the public, or has suffered some other loss, either in his property, character or business, or in his domestic or social relations, in consequence of the publication of such charge. When from the nature of the charge, therefore, in connection with other facts stated in the plaintiff’s declaration, no such injury or loss will necessarily, or even probably result to him in consequence of the publication of such charge, he cannot recover damages as for a libel, without averring and proving that special damage has been in fact sustained by him, in consequence of the charge. The issue before the court was upon demurrer to declaration charging libel.

In Terwillger v. Wands (17 N. Y. 54), the court said that special damages must be the natural, immediate and legal consequence of the words. They cited from Cook’s Law of Defamation (p. 24), “in order to render the consequence of words spoken, special damages, the words must be in themselves disparaging, for if they be innocent the consequence does not follow naturally from the cause.” The words must be injurious in their nature. They further approve the words of a judge in a case cited, “It is said that the words are actionable because a person after hearing them, chose in his caprice to reject the plaintiff as a servant. But if the matter was not in its nature defamatory, the rejection of the plaintiff cannot be considered the natural result of the speaking of the words. To make the speaking of the words wrongful they must in their nature be defamatory.”

It is' to be particularly noticed in the present case, that the so called libel does not charge the plaintiff with having made any false statement in respect of the defendant or his business, or having done any dishonest thing. The complaint charges that the letters written by the defendants were false and untrue and were libels. But taking the whole complaint together, it is to be intended that the complaint meant that the defendant’s statement as to the unbusiness-like conduct of the plaintiff was false.

The defendant did not charge that the plaintiff had been guilty of doing unmercantile things, generally, but the things that were said by the defendant to be unmercantile were specified, such as, &c., &c. This amounts to no more than giving the opinion of the defendant as to plaintiff’s conduct, leaving the employer of plaintiff to form his own opinion on the subject. These things were as follows : “ telling the defendant’s customers to get an inside, that the defendants gave it, and they are fools if they don’t secure it.” The innuendo of the complaint is “meaning that this plaintiff told customers of said defendant, that said defendant had a price other than that at which he offered his goods for sale, and advised them to get it.” The libel evidently does not mean to assert that the defendant did not have two prices for these goods for different sets of customers, but it says that for the plaintiff to tell customers of the fact, was in their opinion, unmercantile. The expression of such an opinion, as to a man’s own interest, is not injurious or defamatory, nor is the communication of it to another likely to do more than cause that other to form an opinion as to plaintiff’s act. The employer of plaintiff being in the business, was able and would naturally protect the plaintiff, by attributing to plaintiff’s acts such qualities as the facts, and not the defendants letter, suggested.

Another tiring was, that plaintiff shrunk some samples of defendant’s goods and said they shrank, and the plaintiff’s samples did not shrink. Nothing of this being said to be false or unjust, as a fact, to the defendant, it could not be injurious to leave the matter for plaintiff’s employer’s opinion. It cannot be said that common experience shows, that under such circumstance, the expression of defendant’s opinion was likely to lead the plaintiff’s employer to form the same opinion. His opinion would be founded upon the facts.

Another part of the libel, as charged, was that the plaintiff “also fishes up some odd samples and says in the same way that our goods are greasy. ” The complaint say, that the meaning of this is, “that this plaintiff attempted by exhibiting an odd sample of goods, to prove that defendant’s goods were greasy and unfit for sale.” This does not even assert that plaintiff attempted to prove that all of defendant’s goods were greasy by exhibiting an odd sample. If it did, the defendant’s charge would be hardly more than that the plaintiff attempted to make an imperfect and erroneous argument.

The most important part of the defendant’s communication remaining unnoticed, is, that the plaintiff “treated with men in the employment of defendant, after being at defendant’s place of business sohciting help, etc., a little unusual proceeding in this section of the country.” The meaning of this is very uncertain. Indeed the innuendo that accompanies it is uncertain in meaning. It is, “meaning that this plaintiff tampered with said defendant’s employees.” It does not appear that the plaintiff is charged with anything unlawful or immoral, or that would tend to degrade or injure him.

The parts of the writing that have not been noticed have no graver import than those that have been considered. The substance is, that the defendant states as facts certain things which are not alleged not to be facts, and giving his own opinion as to them, asks impliedly the opinion of the plaintiff’s employer. The things said to be facts, are not in their nature immoral or unlawful. There is no presumption that a statement of them would injure the plaintiff. The particular consequences that the complaint alleges followed the communication, that is, the defendant being removed from his place at the head of a department of his employer’s business, are not special damage ; first, because there was no libel; second, because it appears that the so-called libel only called upon the employer to form his own opinion and to act upon it. The discharge must have followed the employer’s own view of the facts of the case.

Judgment affirmed, with costs.

Van Vorst and Freedman, JJ., concurred.


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    EDWARD D. BETTENS, et al., Respondents, v. ANDERSON FOWLER, Impleaded, Appellant.

      New trial—Preponderance of evidence—report against—reversal of.— Legal services.

    In an action to recover the value of legal services, the amount claimed was $9,275. The referee found $7,275. There were two witnesses for plaintiff. One who had very little practical knowledge of the value of services'in the city of New York, placed the value at $9,800; the other placed the value at $7,000. The defense called two witnesses, who were in full practice in the city, who respectively estimated the value at about $1,700 and $2,000. Plaintiff's bill as originally presented to defendants was $5,102.52. Held, that the finding of the referee could not be sustained, and the judgment entered on his report was reversed, and a new trial ordered.

      Decided December 22, 1884.
    Before Sedgwick, Ch. J., Freedman and Ingraham, JJ.
    Appeal by defendant from a judgment entered against him upon the report of a referee.

      Martin & Smith,tor appellant.

      Bettens & Lilienthal,.iov respondents.
   By the Court.

Freedman, J.

The complaint claims $9,275, upon a quantum meruit for services rendered by the plaintiffs, who are lawyers, to the firm of Fowler Brothers.

The referee who tried the issues, found the value of the services to be $7,275.

This finding, it is true, is within the range of the testimony upon the question of value, but upon a careful examination of the whole case it appears to be clearly against the weight of the evidence.

The only testimony as to value upon which the finding of the referee must be deemed to rest, is the testimony of a witness called by the plaintiffs, who gave it as his opinion that the services were worth about $9,800. But that witness at the time of giving his testimony had practiced law in the State of New York, but little more than two years. For the six preceding years he had been hi Washington, D. C., and before that in Maine. At Washington he had been assistant attorney general of the United States, a salaried officer. The legal effect of his testimony, as a whole, was that he had very little practical knowledge of the value of professional services in the city of New York.

The only other witness called by the plaintiffs had at one time held the office of attorney general of the state of New York. His valuations of the different items of plaintiff’s bill, when correctly added together, do not come up to $1,000, which is below the' figure adopted by the referee.

The defendant called two witnesses, lawyers in full practice in the city of New York, who respectively estimated the value at about $1,100 and $2,000.

In point of numbers, therefore, the witnesses stand three against one against the conclusion reached by the referee, and so far as the quality of the testimony is concerned, it seems to me that the witnesses called by the plaintiffs, in giving their testimony, were considering more what amount of compensation they themselves would hope to receive in like cases, than what the rank and file of the profession would charge, while the witnesses called by the defense, in giving their opinion, were guided by what in all probabilities the rank and file of the profession would charge.

In addition to all this it appears that the plaintiffs originally only claimed $5,102.52, for which -amount they rendered a bill Upon the defendant’s refusal to pay this bill, the claim was advanced to $9,192.15.

Aside, therefore, from all questions relating to the character of the services, many of which did not require any professional skill, and aside from all questions relating to the results accomplished which were comparatively small, it sufficiently appears that the finding of the referee cannot be sustained. Having reached this conclusion, it is unnecessary to consider the other questions referred to, or the question whether most of the services were not rendered under and in pursuance of a special contract as to price.

The judgment should be reversed and the order of reference vacated, and a new trial ordered, with costs to the appellant to abide the event.

'Sedgwick, Ch. J., and Ingraham, J., concurred.