Bates v. Salt Springs National Bank

60 N.Y.S. 313 | N.Y. App. Div. | 1899

Spring, J.:

This action was brought to foreclose a mechanic’s lien and is .the result of a consolidation of two actions. The .Salt Springs National Bank defended, alleging it was the owner of the.fund sought to be charged with the payment of the plaintiff’s lien. This claim ’ was based upon an assignment of the contract by the building Com tractors, to secure existing and prospective liabilities of those contractors to the bank. The plaintiff, at the time the complaint was framed, knew of the existence of this assignment and charged the assignors with fraud in its execution, but the conduct of the defendant bank in procuring or accepting it was not assailed «¡and no-imputation was made that it lacked consideration or that the officers of the bank knew of the insolvency of the contractors. The question litigated on the trial was as to the effect to. be given to one clause in the building contract providing that payment thereon should be preceded by a certificate of the clerk of Oneida county that no liens were filed against the premises upon which the building was erected. The final payment provided for in the agreement was not to be made until after the completion of the building, and it was contended that this clause in the agreement referred to was for the protection of the lienors as well as the trustees of the Masonic Hall to be builded.

The evidence given related to this specific question. The trial court based its decision upon the construction of the written agreement, and it was affirmed in the General Term on that ground. The Court of Appeals reversed the judgment, with costs to abide the event (157 N. Y. 322), disagreeing with the lower courts in the interpretation of the agreement, and holding that the assignment .to-the bank was superior to the mechanics’ liens.

The plaintiff thereupon applied to the Special Term for an amendment of the complaint, charging the defendant bank with fraud in procuring the assignment; that it knew at the time that the contractors were insolvent and that the assignment was purposely kept a secret from the sub-contractors and materialmen in order that the work might be carried on in reliance upon the contract and in the* expectation that the money to be paid .thereon would be primarily liable for their claims.

It is apparent this raises an issue radically different from that litigated upon the trial. The defendants have succeeded upon the issue already tendered by the plaintiff, and the plaintiff consequently desires to take a new tack and try the case on a different theory. The Special Term granted the amendment but required the plaintiff to pay, as a condition of the favor, $200 costs to the defendant bank and $100 to the defendant Ross, the receiver appointed in proceedings supplemental to execution on a judgment recovered by the bank against Dickison & Allen, the contractors.

The costs and disbursements of the defendant bank amount to the sum of $799.42, and of this sum $519.42 were disbursements. The costs of the receiver are stated to be $265, and of the defendant Catharine Dickison, the wife of the contractor, $280. The rule is well settled that when a plaintiff applies at. Special Term for an amendment to, his complaint, which materially alters the scope of his action, such amendment will be granted upon payment of all the costs of the action antecedent to the granting of the application. (McEntyre v. Tucker, 40 App. Div. 444; Cramer v. Lovejoy, 41 Hun, 581; Brady et al. v. Cassidy et al., 37 N. Y. St. Repr. 501; Frisbie v. Averell, 87 Hun, 217.)

In McEntyre v. Tucker (supra) the court, in criticising the granting of the amendment upon payment of fifty dollars and ten dollars motion costs, say: “ It seems to us that the terms upon which the motion was granted were entirely inadequate. It is conceded by the motion that the plaintiff cannot recover in the'present form of action. The defendant was, therefore, justified in defending; and for the costs and disbursements to which he has been put in the establishment of a successful defense, he is entitled to be reimbursed.. It seems to us, therefore, that he is entitled to recover liis_costs and disbursements for all proceedings subsequent to the service of the complaint, and also to recover the costs and disbursements of appeal where such costs were given to him to abide the event of the action.”

Tlie justice of thihrule-is'-well illustrated finfihiscase. "The defend•'nnts were forced to make tlie fight on the lines : laid down by the plaintiff, and the Court of Appeals has held there Can be ño recovery on that cause of action. ' The'defendants have been put to the costs fin the effort to vindicate their position, and if the plaintiff desires "to try another caiise of action, then.he should first make the defendants whole for what they liaye already incurred, to the extent of the taxable costs and disbursements.

■The order of the Special Term should be modified by striking out the specific sums imposed as a condition of the amendment and, •.fin lieu thereof, requiring the plaintiff to pay the costs and disburseiments of the defendant bank, to be taxed by the clerk of Oneida ■county. The receiver was appointed on the application of the bank, and the assignment to that institution was partly in security of notes on which Catharine Dickison was indorser, so that the real-defendant is the bank itself, and it alone, should be awarded costs. The •¿mended.-complaint is to be served and the said costs are to be paid within thirty .days after the taxation thereof:

Said order should be further modified by eliminating therefrom the restrictions upon the defendants to plead the Statute of Limitations as a defense to the amended complaint.

The order as so modified is affirmed, without costs of this appeal to either party.

All concurred.

Order of the Special Term modified , by striking out the specified sum imposed as a' condition of the amendment and, in lieu thereof, requiring the plaintiff to pay the costs and disbursements of the defendant bank, to- be- taxed- by the clerk, of-Oneida, county; the-amended complaint to be served and the costs to be paid within thirty days from the."service of the order herein. Said order "is further modified" by eliminating therefrom the restriction upon the defendants to plead, the Statute of Limitations ás a defense to the ¿mended complaint, and the order as so modified is .affirmed, with-cut costs of' this appeal to" either 'party.