61 N.Y.S. 155 | N.Y. App. Div. | 1899
Lead Opinion
This action was commenced against John L. Sardy and John Bal'd Rogers, composing the firm of Sardy, Coles & Co., and Nathaniel P. Rogers. John Bard Rogers demurred to the original complaint, his demurrer was sustained and he disappeared from the action. Pending suit Nathaniel P. Rogers died, and the executors of his will were substituted as defendants in his place.
When the cause was before us on a former appeal (1 App. Div. 623), it came up as an action in replevin, in which the plaintiff had recovered a judgment. That judgment was reversed for the reason that under the proofs, as they then appeared, the plaintiff had neither the legal title to, nor the technical legal right to possession as pledgee of, the merchandise, the subject of -the action. In discussing the ease as it was then made, it was said in the opinion of the court that at the utmost and upon the conceded facts, the plaintiff acquired ■only an equitable lien on the merchandise. After the judgment of reversal was entered, the plaintiff applied for leave to amend the •complaint, which was granted and an amended pleading was served which transformed the action into one in equity, bringing within its scope and for administration by the court, all the equities of the parties arising not only out of the original transaction, but alsd those springing from the acts and dealings of the plaintiff with respect to the merchandise and the proceeds of some of it, after the institution of the action and in execution of the writ of replevin. The defendant answered the amended complaint, the cause went to trial and resulted in another judgment in favor of the plaintiff, granting it, upon an adjustment of all the equities, the relief it asked. In the amended complaint, the facts necessary to the assertion and establishment of an equitable lien are stated, unless that
There can be no doubt upon the proven facts that ,the plaintiff was entitled upon the original transaction to an equitable lien, nor do we think it disputable that upon the uncontradicted facts .connected with that original transaction the plaintiff would have been -entitled to a decree to compel specific-perfonnance of the agreement to give to it in pledge and upon demand the merchandise upon which it made the advances set forth in the complaint. That there is an inconsistency in the different attitudes which the plaintiff has taken with respect to the merchandise is doubtless true. Its first claim was as owner and was founded upon the relation it claimed was established by the execution and delivery of the trust receipt given in connection with its advance of money. This court having held that the plaintiff did not occupy the relation of owner to the property, the suit was reconstructed by the amended complaint, and ,the right to an equitable lien was asserted. As the action is now brought before us, it is immaterial what may have been the plaintiff’s original attitude, for the defendants have acquiesced in trying the issues as they are tendered by and framed upon the allegations of the amended complaint. It is necessary, however, that we recur to the early history of the transaction between the parties in order to understand how the equitable rights asserted by the plaintiff arise.
The firm of Sardy, Coles & Co., consisting of Mr. Sardy and John Bard Rogers,'imported from Europe certain merchandise, yvhich, on the 31st of August, 1891, was in the city of New York in the possession of the United States customs authorities and held by. them.subject to the payment of duties. The evidences of title, viz., the bills of lading and the consular invoices, were made out in. the name of and were held by the firm of Perry, Ryer & Co., custom house brokers, in whose name the importation had been made by Sardy, Coles & Co. The last-named firm, not having the money with which to pay the import duties, applied to the president of the plaintiff for a loan to enable them to do so. The application was made by Mr. Sardy, accompanied by Mr. Ryar of the firm of Perry, Ryar & Co. Sardy told the president of the jfiaintiff that he had bought the goods abroad, and Mr. Ryar confirmed that remark and Stated that his firm had .no interest in the goods other than to collect
Thus far, the relations existing between the parties are very clearly .¡defined. The bank had advanced its money on a specific agreement-that it should have certain merchandise as security. That merchandise was to come into the possession of the borrower of the money it was to be received and sold on account of the lender; the actual possession was' to be given to the latter upon its demand.,, Mi*. Nathaniel P. Rogers, when he took possession of some of the merchandise under the assignment to him and collected the proceeds of ¡sale of the other portion, stood in no better or other or different relation to the subject than Sardy, Goles & Co. maintained. He bad actual notice of the plaintiff’s claim to the property. In that situation, the plaintiff, not being entitled to gain possession of the goods by an action of replevin, as was heretofore decided, was ¡authorized to apply to a court of equity to establish and to enforce its right in and! to the goods by way of equitable lien and to have ¡such disposition made of them as equity and justice required. An ¿equitable lien must be judicially established and declared. It must be found to exist, and in its very nature is a right not recognized by 'law,' to have the property or its avails applied as required by some ¡agreement or transaction binding in conscience upon the parties to it. We have in the case, therefore, the cardinal facts that the sum ¿of $3,000 was advanced ; an agreement for & lien upon certain merchandise, from which reimbursement of the loan was to be made; an agreement that the goods should be held or disposed of solely for the benefit of the lender or delivered to it on demand. We have no doubt that as between the bank and Sardy, Coles & Co. and any one Slot a bona fide transferee from that firm, specific performance of
The whole of this transaction in its origin indicates not only the intention of the parties that the lien should exist, but its form was such that when the goods came into the possession of Sardy, Coles & Co. the plaintiff’s right immediately attached. Sardy, Coles & Co. did not have the legal title to the merchandisethat was in Perry, Ryar & Co. That firm, in effect, transferred and delivered to Sardy, Coles & Co. the possession of that merchandise. - When it thus came into the possession of Sardy, Coles & Co., they took it affected in equity by all the terms of the agreement contained in the provision for security incorporated in or connected with the note and in the trust receipt. The plaintiff’s equity is, therefore, so clearly established that it does not admit of doubt or discussion.
We think it quite clear that, under the agreement of the parties, the court could have decreed that Sardy, Coles & Co., upon the demand of the plaintiff, should deliver to ■ it the possession of this merchandise to be held as security to the note; and, that being so, the court had jurisdiction to declare what the rights of the plaintiff in and to that merchandise or its- proceeds are, and to settle all matters in controversy between the parties respecting the same. With that jurisdiction and power, the plaintiff has brought before the court in its amended complaint certain matters showing a change in its relation to the property operated by the institution of this action ns one in replevin and the disposition of ■ a certain portion of the merchandise pending the action. It sets up in the amended complaint that a portion of the goods and chattels were taken by the sheriff of the city and county of .New York and handed over to the plaintiff upon its giving an undertaking in replevin; that the goods “ were never rebonded by the sheriff, but these defendants still hold the bond of this plaintiff conditioned for the return of said goods or their value ; ” and it further appears in the proofs that of the goods taken by the. sheriff and delivered to the.plaintiff on the writ, a certain portion was sold by the plaintiff and it now retains the proceeds. Although the case came before the court at the last trial in a most awkward and inartificial manner, nevertheless, upon
But the defendants insist that material proof upon which the decree was based was inadmissible under the pleadings and that the court below was not justified in making its adjudication upon that proof, because of insufficiency of the allegations of the amended complaint. The point is legitimately in the case. It was raised at the beginning and was insisted upon at various stages of the trial, and cannot be ignored. Before any evidence,was'offered, counsel
Hence, we consider the case as if the defendants’ objections and-motions had been overruled and exceptions duly taken, and shall disregard the amendment allowed to conform the pleading to the proof, holding that such action was not justified, and that no amendment of the amended complaint has been made. It is unquestionably a positive rule that whatever facts are material to the support of an action must be pleaded and proven; as where an action is on contract for the payment of money, non-payment is a material element of the plaintiff’s cause of action (Lent v. N. Y. & Mass. R. Co., 130 N. Y. 504; Cochran v. Reich, 91 Hun, 440; Hicks-Alixanian v. Walton, 14 App. Div. 200); but the allegations here w'ere sufficient to entitle the plaintiff to the relief it asked respecting the merchandise and its application as security to the note. The plaintiff was entitled to some relief, whether a debt was due in the sens© of being payable, or whether it was merely owing. It was enough to show in the complaint that a debt existed. The statement of the transaction as set out in the amended complaint with the exhibits-annexed to and made a- part of that pleading, shows that the plain
It was further objected to the complaint that it. did not allege that the goods on which the plaintiff claimed the lien ever became the goods of Sardy, Coles & Co: There is no such distinct allegation in the complaint,, nor was it necessary. The instruments con
A further ground of nonsuit was urged, and that is that John B. (Rogers, a member of the firm of Sardy, Coles & Co., was not a party •to the action as reconstructed. This objection was not taken by .-answer or demurrer. It appears that he was a party to the replevin .suit; that he demurred to the complaint in that action and he was -discharged from the suit. We do not see that there was any occasion for bringing him back again. A definite judgment as between all the parties settling and adjusting the rights and equities could be liad without his presence.'
The judgment was properly rendered on the pleadings, without any .amendment and the proofs, and should, therefore, be affirmed, -with costs.
Van Brunt, P. J., O’Brien- and Ingraham, JJ., concurred; (McLaughlin, J., dissented.
Dissenting Opinion
(dissenting) :
I dissent. The defendants’ motion, made at the opening of the -trial to "dismiss the complaint, should have been granted, and they .could-not be deprived, without .their consent or acquiescence, of their (.exception to the refusal to dismiss, by the court’s subsequently conforming the pleadings to the proof. ■
The complaint should have been dismissed, because the facts -therein stated did not constitute a cause of action against the •defendants. The Code of Civil-Procedure provides (§ 481) that a ■complaint must contain a plain and concise statement of the facts .constituting the cause of action. This provision is a wise one. The purpose to be accomplished hy it is manifestly to apprise the defendant in advance of the trial of what the plaintiff intends to prove, in order that a proper defense may be made, and it necessarily fol
In the Lent Case (supra) the court said: “ It does not admit of controversy that, upon an ordinary contract for the payment of money, non-payment is a fact which constitutes the breach of the contract, and is the essence of the cause of action and, being such within the rule of the Code, it. should be alleged in the complaint.” And in Witherhead v. Allen (supra): “ When the action is founded upon a contract obligation or duty, the very gist and essence of the ■cause of action is the breach thereof by the defendant, and unless the breach is alleged no cause of action is shown; ” and in Van Giesen v. Van Giesen (supra): “ The material allegations of the complaint in this case are, the making by the defendants of the promis
. For these reasons I cannot concur in the opinion of Mr. Justice Patterson. I think the judgment should be reversed, and a new trial granted, with costs to the appellant to abide the event.
Judgment affirmed, with costs.