172 Misc. 1046 | N.Y. Sup. Ct. | 1939
The defendants, who admittedly owe the plaintiffs $8,572.58, seek permission under section 51-a, of the Civil Practice Act, to notify Josef Schmied, administrator and liquidator of the plaintiffs’ business in Austria, of the pendency of this action so that Schmied might assert whatever claim he has to funds of the defendants, attached here in satisfaction of plaintiffs’ concededly valid demand.
The facts are free from dispute. Since 1872 the plaintiffs, who are Jews, were in business in Austria. When the German Reich enveloped Austria, the plaintiffs' business was seized and appropriated by the Reich solely because of plaintiffs’ race, and Schmied proceeded to " liquidate ” the business. One of the plaintiffs was imprisoned. Ransomed for $34,000, he left the country, and is herq.
The defendants desire to pay what they owe the plaintiffs, but fear the pretended claim of the liquidator. They want the liquidator to contest his claim in this action. Naturally enough, they wish to escape double payment.
The section under which the defendants proceed is not so mandatory as to forbid inquiry. If on the presentation of a motion under the section it is manifest that the claimant sought to be notified and invited to contest has no claim which would be seriously entertained, it would be a waste of time and effort, and grossly unjust to the plaintiffs, to continue the machinery fashioned by the section. Obviously, the section was designed to shield one in a genuine dilemma as to which of several claimants was entitled to funds or property in his hands. The section should not be allowed to be employed as an instrument of persecution or in a campaign based upon racial discrimination. Of course, a decision on the merits is not permissible. But the court may inquire into the possible presence or existence of merits. The section is not concerned with the futile operation of chasing shadows or with inviting the litigation of illusory demands. Our courts are not helpless to penetrate the disguise of law. (Post v. Emmet, 40 App. Div. 477; Pouch v. Prudential Ins. Co., 204 N. Y. 281.)
Unable to perceive that the liquidator can assert anything but a simulated claim to the funds, the defendants’ motion is in all respects denied.
On reárgument, December 21, 1939.
Motion by the defendants for reargument is granted. The recent precedents cited by the defendants as forcing a reversal of the first decision, do not, as I perceive it, necessarily compel such a result. The facts in those cases were different and not' as conclusive as those here. To be sure, the language of section 51-a