App. Div.]

THIRD DEPARTMENT, MARCH TERM, 1897.

LAKESIDE PAPER COMPANY, Appellant, v. THE STATE OF NEW YORK, Respondent.

an outlet,

Skaneateles lake — liability of the State for a detention of its waters deepened by the State, after twenty-four years will be deemed to be the natural chan· nel-discretion of the Board of Claims as to reopening a case.

The right of the State to the water of Skaneateles lake for canal purposes is that of an upper riparian owner, and it is liable to lower riparian owners, who have mills situated on the Skaneateles outlet, for a detention by it of the waters of the lake.

After a permanent change in the channel of the outlet, made by deepening it two and a half feet, had continued for twenty-four years, during which time mills had been erected upon the outlet, which relied upon the supply of water flowing through it, the court considered that its changed condition should be regarded as a natural one, and that the Board of Canal Commissioners had no more right to obstruct the flow of water through it than it would have had if the channel had always been in its changed condition.

It is a matter within the discretion of the Board of Claims of this State whether it will reopen a case after it has been finally submitted and a decision has been rendered.

APPEAL by the claimant, the Lakeside Paper Company, from the award of the Board of Claims of the State of New York, entered in the office of the clerk of said board on the 8th day of October, 1896, upon the decision of the board rendered after a trial duly had before it.

Edwin Nottingham, for the appellant.

T. E. Hancock, Attorney-General, for the respondent. PUTNAM, J.:

The plaintiff on the 14th day of January, 1893, presented to the Board of Claims a demand for damages alleged to have been sustained in consequence of the unlawful detention by the canal authorities of the State of the waters of Skaneateles lake for a period of seventy-eight days between February 1 and April 29, 1892, from its mill situate on the outlet of said lake.

The board, after hearing the evidence offered by the appellant and by the State, on June 26, 1896, determined that there had been no unreasonable detention of the water by the canal authorities, as APP. DIV.-VOL. XV. 22

THIRD DEPARTMENT, MARCH TERM, 1897.

[Vol. 15.

claimed by the plaintiff, at the time in question, and that the latter had sustained no damages entitling it to an award against the State. From such decision the plaintiff has appealed to this court.

In Waller v. State and Skaneateles Paper Co. v. State (144 N. Y. 579) the plaintiffs, like the appellant, were riparian proprietors on the Skaneateles outlet, and claimed damages for the same stoppage of water from February 1 to April 29, 1892, for which this plaintiff now asks compensation. The claims on those cases were disallowed by the Board of Claims. On appeal to the Court of Appeals this decision was reversed and damages awarded to the claimants.

The facts, as stated at length in Waller v. State (supra), were substantially the same as appear in the case under consideration. A careful consideration of such statement of fact in the report of the case cited and the opinion delivered by the court leads to the conclusion that, under the doctrine there established, the award of the Board of Claims in this case cannot be sustained, and that, under the circumstances, an extended discussion of the questions submitted to us on this appeal is not called for.

The Court of Appeals held in Waller v. State that the appropriation by the State in 1843 of the waters of Skaneateles lake and the outlet of the same for a reservoir and feeder to the Erie canal did not affect the rights of the lower riparian millowners along the Skaneateles outlet. Judge PECKHAM in his opinion uses the following language: "We do not think that, by the action of the Canal Board or the Canal Commissioners, or their combined action, these rights of the owners upon the stream below were included in the words of appropriation in the resolution of the Canal Board. Therefore, neither they nor their predecessors had any ground upon which to base an appearance before the Canal Appraisers and attempt to prove any permanent damage to their rights by virtue of the resolution of appropriation. The appropriation did not touch them or their rights. * * *This policy on the part of the State not to then take the rights of the riparian owners further down the stream was not unwise at the time. For more than twenty years after the appropriation, as stated, there was no trouble with these owners, and the State had all the water it required, and for more than twenty years, in addition, the occasions have been few for withholding the water

App. Div.]

THIRD DEPARTMENT, MARCH TERM, 1897.

to the damage of the owners. It would probably have been quite expensive to extinguish those rights at that time, and the necessity for doing so was not present. The State continued on, therefore, and when the necessity arose for temporarily withholding water it was done, its liability for the damage it thus caused was acknowledged, and it was paid under legislative sanction. It is conceded that the State has never, in fact, paid for the permanent appropriation of these rights, and we find no hardship in making it liable for causing them temporary damage since the last payment on that account."

The learned judge in his opinion refers to the fact that the State, since the appropriation of the water of Skaneateles lake in 1843, had from time to time recognized the fact that its right to use the water of Skaneateles lake for the purpose of a feeder to the canal was not inconsistent with the rights of the riparian owners below; and in those cases where its withholding the supply of water was to such an extent as to prevent the operation of the machinery of the mills by the millowners on the outlet below, such withholding was "unreasonable," and it had passed statutes providing for a compensation of such parties as were injured thereby.

The decision in Waller v. State, in effect, holds that the right of the State to the water of Skaneateles lake is that of an upper riparian owner, and also that the detention of the water by the Canal Board from February 1 to April 29, 1892, as against the lower riparian owners owning mills situate on Skaneateles outlet was unlawful and unreasonable, and entitled them to damages.

I think, under the decision in the case cited, we are compelled to reverse the award of the Board of Claims in this case, the facts shown in that case and this being, as above suggested, substantially the same. (See, also, City of Syracuse v. Stacey, 86 Hun, 441.)

But it is said in the opinion of Commissioner BEEBE that the State, in 1868, lowered the outlet of Skaneateles lake two and onehalf feet from a place just below the dam to some distance out into the lake, and that at the time of the detention of the water for which the plaintiff seeks to recover damages, the water was so low in the lake that, had the channel remained in its original condition, the flow of water would not have furnished an adequate supply for the claimant's mill. Hence the commissioner concludes that the

THIRD DEPARTMENT, MARCH TERM, 1897.

[Vol. 15.

detention of the water by the canal authorities at the time in question, under the circumstances, was not unreasonable.

I am not entirely satisfied as to the correctness of the conclusion. of the learned commissioner as to the facts assumed by him. But conceding the facts to be as he states, I think the canal authorities were not authorized to stop for seventy-eight days the supply of water from the plaintiff's mill that would otherwise have flowed through the channel in its changed condition.

The State, in 1868, made a permanent change in the channel by deepening it two and one-half feet, and, therefore, at the time of the detention for which the plaintiff claims damages, this condition had existed for about twenty-four years. The plaintiff and others have built and operated mills and factories and expended large sums of money, relying upon the supply of water flowing through the Skaneateles outlet as the channel was permanently changed in 1868. After the lapse of so many years the changed channel is to be regarded as a natural one, and the Canal Board had no more right to obstruct or prevent the flow of water through the same than it would have had had the channel always been as it now is. (Belknap v. Trimble et al., 3 Paige, 577; Shepardson v. Perkins et al., 58 N. H. 354; Townsend et al. v. McDonald, 12 N. Y. 381; Mathewson v. Hoffman, 77 Mich. 420; Ware v. Allen, 140 Mass. 513.)

I think this is not a case where we should, under the provisions. of chapter 451, Laws of 1896, determine the amount which the plaintiff is entitled to recover, and direct an award accordingly, as in Waller v. State (supra), where the amount of damages, if any, to which the claimants were entitled, was stipulated.

It was a matter within the discretion of the Board of Claims whether or not to reopen the case after it had been finally submitted and a decision rendered, and, under well-settled principles, we would not be justified in overruling its action in that regard; and, therefore, the order from which the appeal is taken should be affirmed. The award of the Board of Claims should be reversed and a new frial granted.

All concurred.

Award reversed and a new trial granted, costs to abide the event.

App. Div.] THIRD DEPARTMENT, MARCH TERM, 1897.

THE ULSTER COUNTY SAVINGS INSTITUTION, Appellant, v. JAMES E. OSTRANDER and AUGUSTUS H. BRUYN, Respondents.

The liability of a surety is strictly construed - — a bond given by a bank official, elected for one year, and who continued to serve for several years · it expires with the year in which it is given.

The liability of a surety is limited to the express terms of the contract, and his obligation, as shown by the terms employed in the contract, should be construed strictly and in his favor.

In an action brought to recover against the principal and against the surety upon a bond, it appeared that on the 16th day of July, 1867, the defendant James E. Ostrander was elected treasurer of the plaintiff "for the ensuing year," and then executed a bond with the defendant Augustus H. Bruyn as one of his sureties, which was conditioned that James E. Ostrander should, "at the expiration" of his office as treasurer, pay and deliver over to his successor all moneys or property due from him, and that he should faithfully, in all things, serve the plaintiff "in the capacity of treasurer as aforesaid during his continuance in office." The bond did not mention the term of office nor the time of service.

James E. Ostrander was re-elected as treasurer in 1868 and in 1869, but was not again elected to that office, although he remained treasurer until the year 1891. He never gave another bond. It was alleged that he was guilty of defalcations, no part of which occurred prior to 1871. A by-law of the plaintiff enacted that the treasurer should hold office during the pleasure of the board of trustees.

Held, that the surety was only liable upon the bond during the first year for which Ostrander was elected, in which year the bond was executed;

That the liability of the surety was not affected by the by-law, as the trustees of the plaintiff, by electing Ostrander treasurer for one year, had signified that it was their pleasure that he should hold his office, under his first election, for the term of one year only.

APPEAL by the plaintiff, The Ulster County Savings Institution, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the county of Ulster on the 15th day of April, 1895, upon the dismissal of its complaint upon the merits, directed by the court after a trial at the Ulster Circuit, and also from an order entered in said clerk's office on the 15th day of April, 1895, dismissing the complaint upon the merits.

The facts are more particularly stated in the dissenting opinion of MERWIN, J.