76 N.Y.S. 269 | N.Y. App. Div. | 1902
The record in this case discloses a peculiar and novel condition. The plaintiff in the action was the owner of abutting property on the street in which the defendants constructed, maintained and operated their elevated railroad. The plaintiff brought his action to recover damages for the appropriation by the railroad of his property rights in the street and succeeded in recovering therefor, as rental and fee damages, a sum in excess of $100,000. This judgment was carried, through all the courts and was finally affirmed in the Court of Appeals, by which affirmance the defendants were required to pay the sum of money secured to be paid by the judgment of affirmance, and the plaintiff upon such payment was required to execute and deliver a conveyance of the property rights appropriated by the defendants. This was a final judgment of the court of last resort and, as between these parties, it finally and conclusively fixed their respective rights, which were that the defendants must pay the sum secured to be paid within a specified time or be enjoined from the maintenance and operation of their railroad, and the plaintiff was required, upon tender of the sum awarded as his damages, to execute the conveyance. It'is evident, therefore, that extraordinary conditions must exist in order to justify the Supreme
The property, which was the subject of the action was originally owned by the Western Union Telegraph Company. On June 4, 1888, this company transferred the property by deed to George W. Tubbs, and by a clause contained therein reserved certain rights in the following language: “ The party of the first part hereto reserves all claim or right of action against the Metropolitan and Manhattan Elevated Railway Companies, or either of them, for any and all injury or damage done to the aforesaid property, or to the value or uses thereof in the past, present or future, by reason of the construction and operation of the elevated railroad in front of the said premises, as it is now constructed and operated.”
Through several mesne conveyances the title to the property became vested in J. N. and L. N. Levy, who conveyed the same to the plaintiff in this action. In the deed to the plaintiff was contained a reservation in these words: “ Damages to said premises arising by reason of the elevated railroad as now constructed and operated in front of said premises have been reserved to the Western Union Telegraph Company, a former owner.”
Upon the trial of this action the railroad company moved to dismiss the complaint upon the ground that the cause of action, if any, was not vested in the plaintiff therein, but was owned by the Western Union Telegraph Company, by whom alone the claim could be enforced. The trial court, as have all the other tribunals who have examined this question, rejected such claim, holding that the easements were appurtenant to the property and passed with the fee; that they could not be severed therefrom; and that the right to recover for an invasion thereof became vested in the owner of the. fee and could only be enforced by him. (Shepard v. Manhattan R. Co., 169 N. Y. 160.) Subsequent to the bringing of this action the Western Union Telegraph Company brought an action against the plaintiff, making parties thereto the grantee Tubbs, all other mesne holders of the title after conveyance to him,
The complaint stated all the facts connected with the transaction and demanded relief, among other things, that the plaintiff and the defendant railroad be enjoined from making any settlement of such action or of paying the money, or in any manner compromising the same; that the defendant Shepard be declared to be a trustee for the plaintiff in the action, and that he be compelled to pay to it all money which he i~ight recover in lus action. The Western Union Telegraph Company by petition sought to intervene as a party in the action of Shepard against the Manhattan Railway Company before the trial of the same, but the motion was denied (Shepard v. Met. El. R. Co., 82 Hun, 527; affd. on appeal, 147 N. Y. 685), and motion for reargument of the same was thereafter denied. (Id. 713.) Thereafter the Western Union Telegraph Company brought its action to trial, when the complaint .was dismissed, and upon appeal to the Appellate Division the same was affirmed. (Western Union Telegraph Co. v. Shepard, 49 App. Div. 345.) On appeal to the Court of Appeals the judgment entered thereon was reversed. (169 N. Y. 170.) By this last decision it was determined that, while a grant of land carries with it all the easements and the right to recover damages for an invasion of the same, yet, where there has been a reservation of the damages for the invasion of such easements by a former grantor, the owner of the fee as to such grantor occupies the position of a trustee and that equity will decree a recovery against him, as trustee, for the~ reserving grautor. As ~e nnderstand thi~ case, it clearly determines that the effect of such a reserve tion as w~s contained in the deed of the Western union Telegraph Company in the absence of all other considerations, was to vest in it the equitable right to the~ moneys recovered; and that Shepard, as owner, became, by operation of~ law and the effect of the reservation, a trustee f~r suëh company. It is noticeable, however, that the Court of Appeals, while laying down this rule as a general proposition, did not assume to determine as an absolute rule of law, under the circumstances of this case, as they might be developed upon the trial of the action, that the
The Court of Appeals had under consideration only the averments in the complaint and the reservations contained in the respective deeds set out therein. The court held that the averments of the complaint were to be so construed as to equitably secure to the telegraph company some of the moneys at least which might be recovered in Shepard’s action.. It is clear, however, that after the telegraph company parted with its title to the premises it could not be damnified for any loss of rents which was thereafter suffered as it was not the owner nor entitled to the occupancy of the premises, nor of any rents which might be produced therefrom. The owner of the property became legally entitled thereto and they could not be severed from his beneficial ownership by any reservation which might be made. The Court of Appeals in its decision construing the complaint of the telegraph company has not passed upon such question and we are at a loss now to see how the telegraph company has any beneficial interest in the damages which have been recovered for loss of rents after such company conveyed away its title to the premises. It is noticeable also that the telegraph company nowhere in its complaint avers in terms that the reservation was based upon any consideration, or that there was deducted from the purchase price of the property any sum on account thereof. On the contrary, it stands squarely on the language of the reservation itself and the inferences that arise therefrom. In the answers of the subse
In Shepard’s action against the railroad, judgment'was entered' upon the remittitur on the 24th day of December, 1901, and the time within which the defendant railroad company was required to make a tender of the sum required to be paid thereunder for the conveyance expired on the 13th day of January, 1902. On December 27,1901, the Western Hnion Telegraph Company obtained an order to show cause why the moneys which were collectible from the railroad company should not be paid into court in its action to abide the further action and decree of the court with respect thereto. Such order also contained an injunction restraining Shepard, his agents, attorneys and employees, from taking steps to enforce the judgment or to receive the money thereon and also restraining the defendant’railroad, its agents and employees, from paying the same or taking other steps to procure a satisfaction thereof.
It is claimed by the telegraph company that it is entitled to impound this money, as the equitable owner thereof, and to restrain payment of the same to its trustee Shepard. It is claimed by the latter that, notwithstanding the decision of the Court of Appeals, he is not only the legal but the equitable owner of the fund in question, and is entitled to have and receive the same, and that even-if he be treated as a- trustee, yet he is a man of large, means and financially able to respond to the telegraph company for any interest it may have in the fund, and that, as it is admitted that he is legally entitled to-, the custody of the money and has a judgment directing its payment to him,, the court not only ought not to impound it, but -has no -power .so to do. The defendant railroad company is ready,
The discussion already had is sufficient to show that Shepard has a substantial interest in this fund, as has also his attorney, even though it be finally adjudicated that the recovery belongs to the telegraph company, or it may be that he will eventually establish his right and title to the whole thereof. Under such circumstances, we think he ought not to be placed in a position where he.will suffer loss. If the money be paid into court it is in defiance of the terms of the judgment which directs its payment to him, and whether he. be a trustee or not, it is undisputed from the record in this case ; nor is any claim otherwise made, so far as we are aware, that he is not abundantly responsible .to answer to the telegraph company for the amount to which it shall show itself entitled. If the money be paid into court it amounts to a very great reduction of its earning power, and Shepard is entitled by his judgment to receive this money or have it so placed that there will be no diminution of earning power to the extent that he has interest therein. It is clear that the telegraph company can easily protect itself from any loss by procuring an injunction in its action restraining the payment of the money over to Shepard. Under such an application it will be required to give a bond which would indemnify Shepard for any losses which he might sustain by reason of his failure to receive the money under the judgment which he has obtained. The telegraph company ought equitably to assume this burden of indemnity. It runs no risk. If it be entitled to the fund, which is the only basis upon which its action can be maintained, it will’ suffer no loss by reason of its bond of indemnity. If it be not so entitled, then
We do not doubt the power of the court to impound the money for the protection of all the parties, but the power ought not to be exercised unless the claimant furnish ample indemnity. It is clear that when Shepard executes the usual conveyance as owner of the property, the railroad company will have acquired all that.it is entitled to demand. No other parties have any interest therein nor is any release required from the telegraph company under the decision of the Court of Appeals. Shepard has the legal title and can convey the same to the railroad as fully and completely as though there were no claimants of the fund aside from him.
It follows from these views that the order should be reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs, but without prejudice to the right of the Western Union Telegraph Company to make application for an injunction in the form and manner prescribed by law. The stay, however, which has been granted will be continued for ten days from the entry of the order herein to allow the telegraph company to make its application, if it be so advised.
Yak Brunt, P. J., Patterson and Ingraham, JJ., concurred; McLaughlin, J., concurred in result.
