Adams v. . Irving National Bank

116 N.Y. 606 | NY | 1889

[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] The evidence as to the statements and representations made to the plaintiff to induce her to make the settlement with the bank was conflicting. The jury were, however, entitled to, and upon the defendant's appeal we must assume they did, adopt the view of the transaction properly inferable from the plaintiff's evidence. This evidence justified the inference that the payment to the bank was not the free, unconstrained and voluntary act of the plaintiff, but was induced by the fear of her husband's arrest on the eve of their departure for Europe, and the effect such an act might have upon his health at that time, shattered and feeble from the misfortune that had overtaken him.

It cannot be successfully claimed, in view of the finding of the jury, that Mr. Castre did not act for the bank. Although perhaps not in the first instance a party to any attempt to secure a settlement of the claim from the plaintiff, in all that he did after he was consulted, he acted for the bank, and he testified, "I supposed Mrs. Adams was able to take care of herself. I performed my duty towards the bank in which I was a stockholder and let her look after herself."

The bank having received the proceeds of the settlement, cannot now be heard to deny the agency through which it was obtained. (Krumm v. Beach, 96 N.Y. 398.)

It is claimed by the appellant that the plaintiff was not entitled to recover if there was a lawful ground for the arrest of her husband, in other words, that a threat of unlawful arrest and imprisonment is necessary to constitute duress per minas. This was the strict common-law rule applied in cases where the duress was against the person seeking to be relieved from his contract. But in practice the narrowness of this doctrine was much mitigated, and money paid under practical compulsion was in many cases allowed to be recovered back, as, for example, payment made to obtain goods wrongfully detained; excessive fees when taken under color of office; excessive charges collected for performance of a duty, etc.

In all such cases there was a moral coercion which destroyed the contract.

The rule cited by the appellant has no application to a case like the present where money has been obtained from a wife by threats to imprison her husband, and none of the cases cited by the appellant so hold. (Metropolitan Insurance Company v.Meeker (85 N.Y. 614) was a case where the defendant was held to be estopped to deny the validity of a mortgage.

In Haynes v. Rudd (83 N.Y. 251; 102 id. 372) the decisions went upon the ground that the note was given to compound a felony, and the contract was for that reason illegal. (Smith v.Rowley, 66 Barb. 502) was decided on grounds similar toHaynes v. Rudd.

In Solinger v. Earle (82 N.Y. 393) plaintiff gave the note in suit to induce the defendant to sign a composition of debts of a firm of Newman Bernhard. The note was transferred to a bonafide holder, and having been compelled to pay it, plaintiff brought the suit to recover from defendants the amount paid.

The court held the contract was illegal, and the same rule that would have protected plaintiff in an action on the note by the payees protected the defendant in resisting an action to recover back the money paid on it. Farmer v. Walter (2 Edw. Ch. 601);Knapp v. Hyde (60 Barb. 80); Dunham v. Griswold (100 N.Y. 224) ; Quincey v. White (63 id. 370) were actions in which the contract was made by the person against whom the duress was claimed to have been exerted.

It is not an accurate use of language to apply the term duress to the facts upon which the plaintiff seeks to recover. The case falls rather within the equitable principle which renders voidable contracts obtained by undue influence. However we may classify the case, the rule is firmly established that in relation to husband and wife or parent and child each may avoid a contract induced and obtained by threats of imprisonment of the other, and it is of no consequence whether the threat is of a lawful or unlawful imprisonment.

Eadie v. Slimmon (26 N.Y. 9), is a leading authority on this question. In that case an assignment of a life insurance policy was obtained by threats to prosecute the plaintiff's husband criminally for embezzlement. The husband, whose life was insured, having died, the action was brought to determine the ownership of the money due from the insurance company. "Judge SMITH, who delivered the opinion of the court, says: "The assignment from the plaintiff to the defendant was most clearly exacted by a species of force, terrorism and coercion which overcame free agency, in which fear sought security in concession to threats and to apprehensions of injury. It was made as the only way of escape from a sort of moral duress, more distressing than any fear of bodily injury or physical constraint. * * * A deed executed at such a time under such circumstance should be deemed obtained by undue influence and ought not to stand."

Five judges appear to have concurred in the part of the opinion quoted. Judge DENIO concurred on the ground that the policy was not assignable, and Judge WRIGHT dissented. The case was cited as an example of duress of person in Peyser v. Mayor, etc. (70 N.Y. 501), and as an authority for avoiding a note obtained by duress in Osborn v. Robbins (36 N.Y. 365). It has frequently been cited in the Supreme Court (Fisher v. Bishop, 36 Hun, 114; Haynes v. Rudd, 30 id. 237; Ingersol v. Roe, 65 Barb. 357; Schoener v. Lissauer, 36 Hun, 102), and in other states and in the text books, and has thus become a leading authority upon the question under discussion. It is nowhere suggested in that case, either in the facts or in the opinion, that it was necessary to sustain the judgment in favor of the plaintiff that the threat must have been of an unlawful or illegal arrest. For all that appears the husband was guilty of the charge made and on that assumption it is peculiarly like the case at bar. Other authorities sustain the same principle. InHaynes v. Rudd (30 Hun, 237), it was said: "We think that when threats of lawful prosecution are purposely resorted to for the purpose of overcoming the will of the party threatened, by intimidating or terrifying him, they amount to such duress or passion as will avoid a contract thereby obtained." This statement of the law was not disturbed by this court, the reversal being put on other grounds.

In Schoener v. Lissauer (supra) a bond and mortgage was obtained from the mortgagor by the threat that unless it was given, his son, who was charged with embezzlement, would go to state prison. The mortgage was set aside and this court sustained the judgment. After stating the facts, it was said by Judge RAPALLO: "On the merits this judgment is sustained by Bayley v.Williams (4 Giff. 638; L.R., 1 E and I. App. 200); Davies v.London Insurance Company (L.R., 8 Ch. Div. 469). The first case cited by Judge RAPALLO fully sustains the recovery in the case at bar.

In Harris v. Carmody (131 Mass. 51) a mortgage was obtained from a father on the threat that his son, who was charged with forging his father's name to notes held by the plaintiff, would be sent to the state prison. It was held that the father could avoid the mortgage on the ground that it was made to relieve the son from duress. (See, also, Taylor v. Jaques,106 Mass. 291.)

In none of the cases cited was it suggested that the threat, which induced the making of the contract, was of an illegal prosecution or an unlawful arrest, and in most of them it appears that the person charged with the offense was guilty.

The principle which appears to underlie all of this class of cases is, that whenever a party is so situated as to exercise a controlling influence over the will, conduct and interest of another, contracts thus made will be set aside. (1 Story's Eq. Jur. §§ 239-251; 2 Pomeroy's Eq. Jur. §§ 942, 943; Lomerson v.Johnston, 44 N.J. Eq. 93; Ingersol v. Roe, 65 Barb. 346;Fisher v. Bishop, 36 Hun, 112; 108 N.Y. 25; Barry v.Equitable Life Assurance Co., 59 id. 587.)

In the last case cited it was said: "When there exists coercion, threats, compulsion and undue influence, there is no volition. There is no intention or purpose but to yield to moral pressure for relief from it. A case is presented more analogous to a parting with property by robbery. No title is made through a possession thus acquired."

It was not error, therefore, for the court to deny the motion to dismiss the complaint on the ground that there was no evidence that the money was paid under duress. Upon the evidence it was a question of fact whether the agreement was executed, and the money paid in consequence of threats and undue influence. (Dunham v. Griswold, 100 N.Y. 224.)

If the money was paid by the plaintiff, through fear, produced by Mr. Castre's representations, that if the claim was not settled, her husband would be arrested and imprisoned, the payment was not a voluntary one and the defendant obtained no title to the money received. This question was settled in plaintiff's favor by the verdict of the jury.

The point made by the appellant that the transaction was a compounding of a felony does not appear to be raised by any appropriate exception in the case. It was not suggested on the trial, either in the motion to dismiss or in the requests to charge. There was no instruction asked or given to the jury on the subject. The question is, therefore, not before this court.

Upon the question of ratification the court instructed the jury as follows: "Before there can be a ratification to prevent her recovery in this action there must be some distinct act of hers, after knowledge of the facts and knowledge by her that she had a right to rescind the agreement." An exception was taken to this part of the charge, and the claim is now made that this court should hold, as a matter of law, that plaintiff had waived her claim.

The defendant appears to have acquiesced in the submission of this question to the jury as one of fact for their determination. It was not made one of the grounds of the motion to dismiss. In part, at least, the charge of the court was correct. I do not understand the learned counsel for the appellant to criticise that part of the charge relating to ratification by some act "after knowledge of the facts." If any qualification was proper in the expression as to her "knowledge * * * that she had a right to rescind," it was the duty of the appellant to suggest it. A general exception cannot be sustained. (Smedis v. B. R.B.R.R. Co., 88 N.Y. 15; Doyle v. N.Y. Eye and EarInfirmary, 80 id. 634.)

We have carefully examined the exceptions to the admission of testimony, and while some of the evidence was immaterial we think none of the rulings are of a character to call for a reversal of the judgment.

The judgment should be affirmed, with costs.

All concur, except BRADLEY, J., not voting.

Judgment affirmed.