147 N.Y.S. 355 | N.Y. App. Div. | 1914
The action was brought by plaintiff in behalf of himself and other creditors of Moritz Rosett, similarly situated.
Rosett and the defendant company, as surety, gave a bond to the People of the State in the sum of $15,000 on August 17, 1908; said bond recites:
“Whereas, Moritz Rosett, the above bounden principal, is engaged or is about to engage within this State in the selling of steamship or railroad tickets for transportation to or from foreign countries and in conjunction with said business, receives or is about to receive money on deposit or carries on or is about to carry on the business of receiving deposits of money for the purpose of transmitting the same, or the equivalent thereof, to foreign countries, and is required to make, execute and deliver a bond pursuant to chapter 185 of the Laws of 1907, as amended by chapter 479 of the Laws of 1908.
“ Now the condition of this obligation ts such that if the above bounden Moritz Rosett shall faithfully and diligently hold and transmit any and all moneys or the equivalent thereof, which shall be delivered to it or them for transmission to a foreign country or countries, and repay any money received on deposit as provided by said Chapter 185 of the Laws of 1907 as amended by Chapter 479 of the Laws of 1908, and duly account for and promptly pay over all moneys or the equivalent thereof, received by it or them as aforesaid, then this obligation to be void, otherwise to remain in full force and virtue. In default thereof the parties hereto will pay all damages, costs and expenses resulting from such default, not exceeding the sum above specified.”
Thereafter the bond was duly approved and filed with the
In March, 1912, Eosett was duly adjudicated a bankrupt. Neither he nor his estate has ever paid plaintiff or any of the claimants any of the moneys so deposited, except that the trustee in bankruptcy has paid two dividends of thirty-eight per cent and two per cent, he has failed to duly account to the said plaintiff or any other claimants for any of the moneys so delivered to him for safekeeping, and has wrongfully and willfully and knowingly retained the same to his own use.
Schedules are attached showing 105 different claimants and the several amounts of their claims. Judgment was given for the amounts found to be due and the surety company appeals
The first claim of the appellant is that the bond in question did not cover savings accounts; that it was the receipt of money in conjunction with the business of selling steamship or railroad tickets and for the purpose of transmitting the same which alone was provided for.
The original statute, chapter 185 of the Laws of 1907, governing the subject provided as follows:
“All corporations, firms and persons now or hereafter engaged in the selling of steamship or railroad tickets for transportation to or from foreign countries, who in conjunction with said business carry on the business of receiving deposits of money for the purpose of transmitting the same, or the equivalent thereof, to foreign countries, shall, before entering into said business, or before continuing said business, except as hereinafter provided, make, execute and deliver a bond to the People of the State of New York in the sum of fifteen thousand dollars, conditioned for the faithful holding and transmis
Under that statute it might be fairly arguable that its provisions applied only to the receiving of deposits of money for the purpose of transmitting the same to foreign countries by persons engaged in the selling of steamship or railroad tickets for transportation to or from such countries. But chapter 479 of the Laws of 1908 amended said act so as to read as follows:
“All corporations, firms and persons now or hereafter engaged within this State in the selling of steamship or railroad tickets for transportation to or from foreign countries, who in conjunction with said business receive money on deposit or carry on the business of receiving deposits of money for the purpose of transmitting the same, or the equivalent thereof, to foreign countries, shall, before entering into said business, or before continuing said business, except as hereinafter provided, make, execute and deliver a bond to the People of the State of New York in the sum of fifteen thousand dollars, conditioned for the repayment of such deposits and the faithful holding and transmission of any money, or the equivalent thereof, which shall be delivered to it or them for transmission to a foreign country.”
This court said in Musco v. United Surety Company (132 App. Div. 300): “The Legislature could well take notice of the frequent embezzlements and misappropriations by transatlantic ticket agents of funds intrusted to them for transmission by their fellow-countrymen, and that ignorant emigrants were more likely to intrust money for transmission to their home countries to the men who had had charge of the transporting of themselves or their friends than through regular banking institutions. For the purpose of preventing imposition and fraud and. crime, and promotion of the public welfare, the Legislature had the right to enact a law regulating the carrying on of such business and imposing as a condition the giving of a bond in any reasonable amount.”
In affirming (196 N. Y. 459) the Court of Appeals said: “ The regulation of the business of receiving deposits is plainly within the power possessed by the State to regulate the conduct of various pursuits when necessary for the protection of
The reasoning by which regulation of this peculiar business, that is, combination of ticket selling and private banking, was justified is equally applicable to the amended statute which clearly and unmistakably inserted, as a separate transaction, the receiving of deposits of money by persons engaged in selling steamship tickets. The receiving deposits of moneys for the purpose of transmitting the same is clearly differentiated from the provision for the receiving money on deposit by the disjunctive “ or,” and the condition of the bond is made for “ the repayment of such deposits” as well as for “the faithful holding and transmission ” of money delivered for transmission. The purpose of the act is protection to a class liable to imposition and unfit to protect itself. The evil aimed at, to wit, the misappropriation and embezzlement is the same whether the ticket agent receives the money on deposit or for transmission. The purpose of the Legislature to broaden the scope of statutory control over persons engaged in such business is clear; the sole purpose of the amendment was to include money received on deposit. The Statutory provision was within the power of the Legislature. The bond follows the statute and the plaintiff is entitled to the benefit of the provision.
The second point advanced by the appellant is that moneys deposited before the bond was given, but allowed to remain with Rosett after the bond became operative, are not recoverable against it,
The third point made is that moneys allowed to remain after the law under which the bond was given became inoperative September 1, 1910, are not chargeable to the bond or covered by it.
Chapter 479 of the Laws of 1908 was carried into the Consolidated Laws without change as article 10 of the General Business Law (Consol. Laws, chap. 20; Laws of 1909, chap. 25). In 1910 by chapter 348 a new article, 3a,
The obligation of the bond is not that Rosett and the surety company should account up to August 31, 1910, but that they shall duly account for and promptly pay over. The moneys were received prior to the 1st of September, 1910, and, hence, the obligation to account and pay over was incurred, and until that duty is duly performed the appellant is liable under its bond. Being a contract liability it could not have been affected by subsequent legislation, for such legislation would have been violative of article 1, section 10, subdivision 1, of the Constitution of the United States, but no such legislation was attempted, for, as pointed out, existing liabilities were expressly preserved. We have considered all the matters urged by the appellant upon this appeal and find no reversible error in the record.
The judgment appealed from should be affirmed, with costs to the respondent.
Ingraham, P. J., Laughlin, Scott and Dowling, JJ., concurred.
Judgment affirmed, with costs.
Amd. by Laws of 1911, chap. 393. See Banking Law (Consol. Laws, chap. 2; Laws of 1914, enap. 369), §§ 150-172, 500, 502.—[Rep.
Amd. by Laws of 1911, chap. 578.— [Rep.