208 A.D. 574 | N.Y. App. Div. | 1924
The action is brought upon twenty-two promissory notes, the aggregate principal of which amounts to $61,600. Said notes were made by the defendant, Edward DeV. Tompkins, Inc., to the plaintiff, Harold Williams. The complaint is in the usual form, setting up twenty-two causes of action, one as to each of said notes.
The answer of the defendant first denies the allegation of the complaint as to each separate cause of action as to the amount due upon the note to which it pertains, and also denies that no part of the said note has been paid, and denies that the amount stated as to each cause of action is due from the defendant to the plaintiff.
Two counterclaims are set forth in the answer, in the first of which it is alleged that the defendant was released from the payment of the notes in suit, and that any obligation or indebtedness thereon on the part of the defendant was, with the knowledge, consent and acquiescence of the plaintiff, assumed by the copartnership of Leary & Co.; and' that the notes were extinguished as obligations of the defendant, Edward DeV. Tompkins, Inc., as
“ II. The said' party of the third part [Leary & Co.] assumes all the debts, obligations and liabilities owing by the party of the second part [Edward DeV. Tompkins, Inc.], where such debts, obligations and liabilities have arisen or grown out of the said sewer contract.”
The parties to said agreement were Edward DeV. Tompkins, individually, the defendant corporation, and Leary & Co. The plaintiff was not a party thereto, although as a stockholder of the defendant corporation he signed a consent to the execution of the contract. Nowhere in the contract does it appear that Leary & Co. assumed the payment of the notes in suit given for advances made by the plaintiff to the corporation; and while it is alleged in said counterclaim that the defendant corporation was discharged of any liability to the plaintiff upon the promissory notes in suit, there was no basis therefor in the agreement aforesaid. The facts aforesaid are alleged in said answer as a first separate and distinct
In the second counterclaim, wherein the defendant seeks to join as parties defendant the said Daniel J. Leary and William C. Reid as copartners doing business under the firm name and style of Leary & Co., Daniel J. Leary and Edward DeV. Tompkins, it is alleged that under the aforesaid agreement made between Edward DeV. Tompkins of the first part, Edward DeV. Tompkins, Inc., of the second part, and Leary & Co. of the third part, the defendant was to be released from all liability to the plaintiff arising out of said notes by reason of the same facts and circumstances set forth in the first counterclaim, the defendant claiming that it was the understanding thereby that the defendant Edward DeV. Tompkins, Inc., should be held free and harmless from any claims whatsoever by reason of such notes, and that it was the duty of Leary & Co. to have canceled and discharged the same. It is the claim of the defendant that under said agreement Leary & Co. assume Lability on said notes, notwithstanding the fact that the plaintiff was not a party to the said agreement, but merely consented thereto as a stockholder of the defendant corporation. Defendant corporation, in its prayer for relief, demands that the plaintiff and the defendants Daniel J. Leary, and Daniel J. Leary and William C. Reid, composing the firm of Leary & Co., whichever of them may be in possession of the notes which are the subject of the complaint in this action, be directed to surrender the same to the defendant Edward DeV. Tompkins, Inc., for cancellation; that as alternative refief, if such canceLation be not decreed, the defendants Leary and Reid, composing the firm of Leary & Co., be decreed to specifically perform the said agreement between Tompkins, the defendant and Leary & Co. by paying any judgment that may be rendered in this action in favor of the plaintiff and against the defendant on the said promissory notes which are the subject of this action, and that said defendants Leary and Reid be compelled to satisfy and discharge aU of the said promissory notes so as to save the defendant from a multiplicity of suits, and assuring the defendant peace from further prosecution and litigation on account of such notes.
It thus appears that the defendant first sets forth what may be a complete defense to the notes in suit, and in another breath says that if the defendant is liable thereon, the other parties should be required to pay any judgment recovered herein. It is perfectly plain that the facts alleged by way of counterclaim in said answer do not constitute a cause of action against the plaintiff.
The defendant, by the interposition of said second counterclaim, seeks to bring in said new parties by virtue of the provisions of section 271 of the Civil Practice Act which provides in part as follows:
“ § 271. New parties set up in counterclaim. Where a defendant sets up any counterclaim which raises questions between himself and the plaintiff along with any other persons, he shall set forth the names of all the persons who, if such counterclaim were to be enforced by cross action, would be defendants to such cross action.” (Italics are the writer’s.)
The remainder of section 271 provides that where such other person is not a party he shall be summoned to appear and be served with the answer, and thereby becomes a party defendant to the action and may reply to said counterclaim or he may serve a notice of appearance on the party interposing the counterclaim.
I do not think that the defendant in its second counterclaim alleges any facts which raise questions between the defendant and the plaintiff along with the other persons sought to be brought in as parties defendant. Under the allegations of the counterclaim and by virtue of the provisions of the contract annexed to and made a part thereof, there arises no claim on the part of the defendant against the plaintiff. How then can it be said that the counterclaim raises questions between the defendant and the plaintiff along with said other persons, sought to be brought in? The basis of a counterclaim is a cause of action on the part of a defendant against a plaintiff. No facts are alleged in the
The defendant relies upon the case of Gettinger v. Glasser, No. 2 (204 App. Div. 829). That case passed through this court and was decided April 6, 1923. The action there was brought by the plaintiffs, as copartners, against the defendants, copartners, to recover for work, labor and services. In their amended answer the defendants allege that the plaintiffs were employed to manufacture ladies’ dresses for the defendants from materials furnished by the latter, and that the defendants had delivered to the plaintiffs raw materials, for which the plaintiffs had not accounted, to the amount of $6,878.69; that the defendants held a policy of burglary insurance upon said goods while upon the premises occupied by the plaintiffs; and that while said raw materials were in plaintiffs’ possession, the premises of the plaintiffs were broken into and violently entered by some person or persons, and said raw materials of the defendants, consisting of pieces of taffeta of the value of $6,878.69 aforesaid, were feloniously abstracted therefrom; that immediately upon discovery of such loss the defendants duly notified the National Surety Company of New York, which had issued said policy of burglary insurance, and made proof of loss according to the requirements of said policy, and duly performed all of the conditions of said policy on their part; that more than ninety days had elapsed since furnishing to the defendant National Surety Company of New York all of the particulars of said loss, but that the said defendant surety company had paid no part of said insurance to the defendants. The defendants further set up in their answer by way of counterclaim and allege that the said defendants delivered to the plaintiffs the goods, wares and merchandise in question of the reasonable market value of $6,878.69, and engaged plaintiffs to manufacture the same into ladies’ dresses, which the plaintiffs promised and agreed to do, and to return the same to the defendants Glasser & Weinstein within a reasonable time on demand; and the defendants allege upon information and belief that the plaintiffs have failed to manufacture dresses from said goods for said defendants, and that the defendants have duly demanded of the plaintiffs that they return said goods, but that the plaintiffs failed and refused so to do. The action was brought by the plaintiffs, as copartners, against the defendants Glasser & Weinstein, impleaded with the National Surety Company of New York, which had issued said policy of insurance. In the prayer for relief the defendants demand judgment for a dismissal of the
Section 271 of the Civil Practice Act is a new provision engrafted into our civil procedure from the English Rules of the Supreme Court, where in substantially the same form it appears as order 21, rules 11-14. (See Report of Joint Legislative Committee on Simplification of Civil Practice [N. Y. Legis. Doc. 1919, Vol. 40, No. 111], pp. 188, 189, § 271, note; White & King’s The Annual Practice 1924, pp. 368, 369.) These provisions have inaccurately become known in this State as the English Practice Act. (See Wile v. Nassau Smelting & Refining Works, Ltd., 205 App. Div. 657, 658, 659; Norwich Pharmacal Co. v. Barrett, Id. 749, 751, 752.) Such being its origin, it should be construed in conformity with the construction of the courts in the jurisdiction from which it was derived. (Appelbaum v. Gross, 117 Misc. Rep. 140; affd., on opinion below, 200 App. Div. 914; Interstate Commerce Commission v. Baltimore & Ohio R. R., 145 U. S. 263.) The English authorities seem in accord in holding that a defendant may not, under such practice provision, join as parties those liable separately from the plaintiff; and that where alternative relief is asked against the persons sought to be brought in, they are not persons liable along with the plaintiff within the purview of the statute. In Times Cold Storage Co. v. Lowther (L. R. [1911] 2 K. B. 100) the court (at p. 106) construed the words “ along with ” as used in rule 22 of order 10 of the English County Court Rules (Ruegg’s The Annual County Courts Practice 1923, p. 435), the first part of which is in the same terms as rule 11 of order 21 of the English Rules of the Supreme Court (White & King’s The Annual Practice 1924, p. 368), as follows: “ In my opinion ‘ along with ’ does not mean diversely from or separately from, but means what it says, ‘ along with,’ and a case in which an alternative remedy is counterclaimed against a third person is not a case in which the counterclaim raises questions between the defendant and the plaintiff along with that third person. In the present case the defendants seek to bring in the New Zealand Shipping Company, not to answer a joint case along with the Times Cold Storage Company, but to be parties to the litigation, while a different case is raised against
In Bullen & Leake’s Precedents of Pleadings (7th ed. p. 465) the authors say: “ It will be observed that Ord. XXI, r. 11, cited below, is confined to counterclaims which raise questions between the defendant and the plaintiff ‘ along with any other persons.’ Hence, it has been held that a person cannot be joined as defendant along with the plaintiff to a counterclaim where relief is only claimed against the plaintiff and such person in one of two inconsistent alternatives (Evans v. Buck, [1876] 4 Ch. D. 432; 46 L. J. Ch. 157; Central African Co. v. Grove, [1879] 48 L. J. Ex. 510. Cf. Times Cold Storage Co. v. Lowther, [1911] 2 E. B. 100; 80 L. J. K. B. 901, which was a decision of a Divisional Court upon the same words in the corresponding County Court rule).” (See, also, Central African Trading Co. v. Grove, 48 L. J. Ex. 510.)
Each of the orders appealed from should be affirmed, with ten dollars costs and disbursements to the respondent in each case.
Dowling, Smith, McAvoy and Martin, JJ., concur.
In each case: Order affirmed, with ten dollars costs and disbursements.