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SECOND DEPARTMENT, MARCH TERM, 1897. [Vol. 15. If the corporation is insolvent, its object is certainly defeated and its usefulness to its members is impaired, if not totally destroyed. The report shows not only that it has failed to accumulate a fund, but that its officers have dissipated the premiums received from its members in violation of the articles of association.
Besides, so far as appears from the papers, the officers have clearly violated the article which forbids the payment of salaries and expenses except from earnings, and then only within a certain and definite limitation. If there is any liability on the part of the officers to repay the sums illegally expended or appropriated by them for their own salaries, the receiver can enforce the repayment of these sums with greater certainty and effect than eyen the new officers would be apt to do in authorizing and prosecuting an action in behalf of the corporation against their predecessors, all the more that the allegations of the complaint in such an action must necessarily contain charges of violation by such officers of their fiduciary duties.
We consider, therefore, that the best interests of the members of the corporation will be conserved by affirming the order appointing the temporary receiver.
All concurred, except BARTLETT, J., not voting.
Order affirmed, with ten dollars costs and disbursements.
LEOPOLDINE SCHAUM, Appellant, v. THE EQUITABLE Gas Light
Negligence — erplosion of gas in a cellar from a cause not shoron — presence of a
workman in the cellar with a candle.
In an action where negligence was charged against a gas light corporation, it appeared that the plaintiff was standing on the ground floor of a building when an employee of the defendant came into the house for some purposes connected with its gas pipes, went down into the cellar, came upstairs and asked for a pair of pliers, went back to the cellar, came up again, asked for a candle, and went into the cellar with it, after which bammering was heard in the cellar, and shortly thereafter there was a smell of escaping gas. It was then discovered that the employee was unconscious in the cellar.
Persons who went down to rescue him at first could not see him, went to the front of the cellar, and were about to pick him up when, as one of them testified,
"a big flash of fire came around us and scattered us all over the floor.” There was no evidence to show that the employee of the defendant had lighted the
candle, or that he had any other light with him, nor any to show the cause of the explosion by which the plaintiff was injured. Held, that as there was no evidence that the workman lighted the candle, or was
in any manner the cause of the explosion, the defendant was not liable for
injuries sustained by the plaintiff therefrom; That, in delivering gas, a gas company was not an insurer, but was simply bound
to that degree of care which the nature of the article dealt in, and the consequences to be apprehended from an accident, reasonably called for, and that within this definition of its liability the plaintiff could not recover.
APPEAL by the plaintiff, Leopoldine Schaum, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of New York on the 7th day of November, 1896, upon the dismissal of her complaint directed by the court after a trial at a Trial Term of the Supreme Court held in and for the county of New York, and also from an order entered in said clerk's office on the 29th day of October, 1896, denying the plaintiff's motion for a new trial made upon the minutes.
This appeal was transferred from the first department to the second department.
Thomas McAdam, for the appellant.
Joseph Kliny and F. R. Coudert, for the respondent.
The complaint alleges that the plaintiff, on February 6, 1893, while standing in a saloon on the ground floor of a building on West Thirty-ninth street, was injured by an explosion of gas, which injured her and her property, and that such explosion was caused by the negligence of the defendant or its servant, who was working upon the gas pipes in the cellar of said building, whereby gas was permitted to come into contact with a light of some kind, thus causing an explosion.
The evidence shows that an employee of the defendant came to the house for some purpose connected with the gas pipes, went down into the cellar, came upstairs and asked for a pair of pliers, went back to the cellar, came up again, asked for a candle and went
SECOND DEPARTMENT, MARCH TERM, 1897. [Vol. 15. down again, after which hammering was heard in the cellar. Shortly after there was a smell of gas, which was escaping in large quantity. By some means it was discovered that the workman was unconscious in the cellar. Two or three men went down for the purpose of rescuing him, heard him moaning, but were unable to see him, and so went to the front of the cellar, where they were about to pick him up, when, as one of them testified, "a big flash of fire came around us and scattered us all over the floor." There is no evidence to show that the workman had lighted the candle, or had any other light with him, and no evidence is given to show the cause of the explosion.
The doctrine of res ipsa loquitur does not apply to the present action. In the case of Schmeer v. The Gas Light Co. (147 N. Y. 529) the Court of Appeals held that a gas company, if liable at all, must be held liable for its own negligence; that in making delivery, of gas it is not an insurer, but is simply bound to that degree of care which the nature of the article it deals in, and the consequences to be apprehended from an accident, reasonably called for, and that the law ought not to, and does not, exact an unreasonable amount of care from any one.
In the case of Cosulich et al. v. The Standard Oil Co. (122 N. Y. 118) the court held that the defendant was not maintaining a nuisance; that its business was lawful, and in its conduct the law does not impose the obligation of saving others harmless from the consequences of inevitable accident, but rather burdens it simply with the duty of using reasonable care and caution to save others from injury; that it is not sufficient to show that an explosion happened, but that the plaintiffs must go a step further and prove facts from which it can be legitimately inferred that, either in construction, repair or operation, the defendant had omitted that reasonable care and caution which he could have observed.
There is no evidence in the case at bar of any negligence on the part of the defendant which was the proximate cause of the explosion. It was not sufficient for the plaintiff to show that an explosion happened where the business of the defendant was lawful and useful, but he was bound to show that the explosion resulted from the negligence of the defendant or its servants, and this he failed to show at the trial.
App. Div.] SECOND DEPARTMENT, MARCH TERM, 1897.
The evidence relating to a light is expressed in a single sentence, i. e., that the workman asked for a candle and went into the cellar with it. There is no evidence whatever that he lighted it. Indeed, when the rescuing party went to his assistance, before the explosion, they were unable to see him until they were within two feet of him, walking with their heads to the ground and feeling along it as they advanced, and the inference is not unjustifiable that he had no light. Whether he was overpowered by the fumes of the gas, or whether he had met with an accident in some other way, does not appear. It is not sufficient to surmise that he had lighted the candle, or that any light caused the explosion. The evidence, therefore, shows no negligence of the workman which resulted in the explosion, as alleged in the complaint, and the complaint was rightly dismissed.
The judgment should be affirmed, with costs.
JOSEPH McCONKEY, Appellant, v. Victor PETTERSON and ELIDA
PETTERSON, Respondents. A contract, originally usurious, may be purged of usury. Although a note is usurious in its inception, yet if, in fixing the amount of a renewal note, the lender credits upon the principal of the original loan the usurious interest, and merely adds lawful interest on the balance from the date of the original loan, the contract is purged of usury and the renewal note is enforcible.
APPEAL by the plaintiff, Joseph McConkey, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the county of New York on the 12th day of October, 1896, upon the verdict of a jury rendered by direction of the court in an action on a promissory note.
This appeal was transferred from the first department to the second department.
John J. Crawford, for the appellant.
SECOND DEPARTMENT, MARCH TERM, 1897.
[Vol. 15. Goodrich, P. J.:
In July, 1893, the parties to this action entered into a self-styled indenture, whereby, under their hands and seals, they solemnly covenanted and agreed that the plaintiff should loan the defendant Victor Petterson $340 for the space of sixty days, and that Victor, for the use thereof, should pay the plaintiff "an interest bonus” of $20. Not satisfied with this extraordinary personal contract, they agreed that it should bind the heirs, executors, administrators and assigns of the respective parties.
The plaintiff loaned the $340, and the defendant gave his note for the amount, and subsequently paid $20 interest. The note, not being paid at maturity, was renewed from time to time until July, 1896, when the note in suit was given.
The judicial faculty is not severely strained in discovering legal objections to the validity of this contract.
At the trial, however, it was shown that the original note was renewed from time to time until the note in suit was executed, at which time the plaintiff, by agreement with the defendant, prepared the last note, the amount of which was determined by crediting on the principal of the original loan the $20 usurious interest and adding lawful interest on the balance from the date of the original loan.
Under these circumstances, the original loan is purged of the usury with which it was tainted. The case of Sheldon v. Hartun (91 N.
Y. 124) is clear authority on this point. The court (Earl, J.) said: “ If this note for $1,000 had been given in this State, even with the lawful rate of interest mentioned therein, in renewal of or in substitution for, the prior usurious note, it would also have been tainted with usury and void. A substituted or renewal note thus given is held void for one or both of these reasons : The new note, in such a case, is given in renewal or continuance of the usurious contract, and is, therefore, void for the same reason that condemns that contract; or it is a new security for a usurious debt or contract, and void on that account. In either case the new note is void, because it comes under the condemnation of the policy and the letter of our usury laws. But a surious contract can be purged of the taint of usury, and money loaned upon a usurious contract can furnish a valid consideration for a promise to pay the money actually loaned. If the