(189 N.Y.S.) OSMANSKY et al. v. AUERBACH. (Supreme Court, Appellate Term, First Department. June 9, 1921.) Landlord and tenant 200 (1%)-Court's refusal to consider particular items of expenses in fixing reasonable rental held error. In landlord's suit for increased and reasonable rental, where the increased rental sought by the landlord seemed prima facie reasonable, the action of the court in striking from the landlord's bill of particulars items of expenses apportioned for the year for raising a mortgage, attorney's fees in dispossessing tenants, losses of rentals, and depreciation, must be deemed error, in absence of a showing why such items were stricken out, or how reasonableness of the rental awarded was arrived at. Appeal from Municipal Court, Borough of the Bronx, Second District. Action by Morris Osmansky and another against Sadie Auerbach. From a judgment for plaintiffs, as landlords, fixing the amount of rental at only $25 a month, in an action in which they sued for increased and reasonable rental of $38 a month, plaintiffs appeal. Reversed, and new trial granted. Argued May term, 1921, before GUY, BIJUR, and McCOOK, JJ. Goldstein & Goldstein, of New York City (Jonah J. Goldstein, of New York City, of counsel), for appellants. PER CURIAM. The learned judge below struck out from the plaintiff's bill of particulars items of expenses apportioned for the year for raising a mortgage, attorney's fees in dispossessing tenants, losses of rentals, and depreciation. As no respondent's brief is submitted, and no indication in the record given of why these items were stricken out, or how the reasonableness of the rental awarded was arrived at, and as prima facie the amount sought to be recovered seems to be reasonable, the judgment must be reversed, and a new trial granted, with $10 costs to appellant to abide. the event. (197 App. Div. 340) MCKENNELL v. PAYNE, Director General of Railroads, et al. (Supreme Court, Appellate Division, Second Department. May 20, 1921.) 1. Process 86-Service by publication gives no jurisdiction in action to establish mere personal claim. In an action to establish a mere personal claim or debt, the court cannot obtain jurisdiction over a defendant outside the state by service of notice by publication; but in an action in rem, having for its subject specific property within the jurisdiction and control of the court, such service will confer jurisdiction. 2. Attorney and client 190 (4)-Defendant, paying damages, presumed to retain enough to discharge payee's attorney's lien. In an action by an attorney to foreclose a lien on a settlement made by his client with the Director General of Railroads for damages for the death of her husband, the defendant must conclusively be presumed to For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes have retained in his actual possession enough of the settlement fund to discharge the attorney's lien. 3. Courts 19-Personal service on Director General, together with presumption that he retained a fund to pay attorney, suing to enforce lien, gave court jurisdiction. An action by an attorney to recover from the Director General of Railroads the amount of his lien on funds paid by defendant to plaintiff's client in settlement of her claim for damages is in rem, as affecting specific personal property within the jurisdiction and control of the court, the presumption being that defendant has actual possession of the same, so that personal service on defendant brings such property within the jurisdiction and control of the court. Appeal from Special Term, Westchester County. Action by Thomas A. McKennell against John Barton Payne, United States Director General, operating the Lehigh Valley Railroad, and Anna Ahearn McDermott, individually and as administratrix, etc., to foreclose attorney's lien. From an order of the Special Term, denying her motion to vacate and set aside an ex parte order directing the service of summons upon her by publication, and to declare such attempted service null and void, defendant McDermott appeals. Affirmed. Argued before BLACKMAR, P. J., and MILLS, PUTNAM, KELLY, and JAYCOX, JJ. Peter C. Mann, of New York City, for appellant. MILLS, J. This action was brought by the plaintiff, a New York. lawyer, to foreclose his alleged lien upon the settlement by the defendant, the United States Director General, operating the Lehigh Valley Railroad, of the cause of action of the said appellant as administratrix, etc., to recover damages for the death of her husband, killed in Jersey City while in the service of defendant's predecessor in the operation of said railroad; his death being alleged to have been caused by the negligence of defendant's said predecessor in that operation. The complaint in this action, in addition to the above-recited facts, further alleges: (a) That the said McDermott as such administratrix retained. the plaintiff to take and prosecute legal proceedings against the Director General to recover such damages, and agreed to pay the plaintiff for his such services one-third of any amount that might be recovered by settlement or verdict or judgment; (b) that under that retainer plaintiff brought in her name as such administratrix an action against said Director General in the United States District Court for the District of New Jersey to recover the sum of $100,000, and that the said Director General appeared in said action and made and filed his answer therein; (c) that thereafter, on or about May 1, 1920, he settled said action with her by paying her the sum of $15,000 without plaintiff's knowledge or consent; (d) that at all said times there was in force in New Jersey a statute giving the plaintiff a lien upon said cause of action and any settlement thereof for his services, such statute being set forth in full and being in all substantial respects like the For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes (189 N.Y.S.) corresponding New York statute; 1 (e) that defendant McDermott has refused to pay plaintiff, and that she has no property, real or personal, in this state, and is without means and is a nonresident; and (f) that she has or claims some interest in the fund of $5,000 which the plaintiff claims the other defendant holds subject to his said lien. Judgment, therefore, is demanded in the complaint that plaintiff has such lien, and that the defendant McDermott be foreclosed of all right or interest in the sum thereof, and that the other defendant be decreed to pay the amount thereof, $5,000, over to the plaintiff. No personal judgment, however, against the appellant is asked. The moving affidavits, upon which the original order for service by publication was made, served only to emphasize the fact that the appellant is a resident of New Jersey, and has been such continuously for the last 25 years, and cannot be served personally within this state. Summons and complaint herein were duly served upon the other defendant personally within this state on February 14, 1921. The contentions of the appellant here are, and at the Special Term upon the motion to vacate were: (a) That this court has no jurisdiction of the action, as the cause thereof arose entirely in New Jersey and the settlement was made there; and (b) that it has no jurisdiction over the appellant and could acquire none by service by publication. The latter point appears to be the real one involved. [1] The law of the matter was, quite recently (March, 1921), clearly expressed by the Court of Appeals in its decision and opinion (written by Hiscock, C. J.) in Hanna v. Stedman, 230 N. Y. 326, 130 N. E. 566. In that case a fraternal beneficiary association, having at all times its principal office in this state, was by the recent death of one of its members indebted to some one in the sum of $1,000, the stipulated benefit. Under the circumstances there were two claimants, or sets of claimants. The member, at his death, was a citizen of Maryland, and his widow had died after him, a resident also of that state, and her estate was being administered there. Her representatives, who resided there and were appointed by the proper Maryland court, constituted one set of claimants, and a son, who was a resident of this state, was a rival claimant. The association thereupon brought an action in this state in the nature of an interpleader, making all of the claimants parties, but served the Maryland defendants by publication only. They did not appear in the action, and judgment therein went in favor of the son, and the association paid the amount over to him accordingly. Thereafter the Maryland representatives of the widow's estate brought action in the Maryland court against the association, which pleaded the New York judgment in bar; but the Maryland court held that that judgment was no bar to the Maryland people, as the service upon them by publication had conferred no jurisdiction upon the New York court against them. Later action in this state was commenced upon the Maryland judgment in favor of the claimants there, and the association in that action pleaded the New York judgment in bar. Therefore the question was clearly presented for our courts to determine whether or not the New York court in the original action had obtained jurisdic 1 See Laws N. J. 1914, p. 410, c. 201; Comp. St. Supp. N. J. 1911-1915, p. 898, § 6; Judiciary Law (Consol. Laws, c. 30) § 475. tion over the Maryland people. Our Court of Appeals unanimously held that it had not; in other words, that the order for service by publication upon the Maryland people was a nullity; and it reversed the judgment of the lower courts in favor of the defendant association, and gave judgment to the plaintiff therein for the full amount. The opinion declares that, had the original action of interpleader been one "in rem, or one affecting specific personal property," there could have properly been such service by publication, but that in fact and law the action was not of that character but was merely one to establish a personal claim that is, a mere debt. The opinion (230 N. Y. at page 335, 130 N. E. at page 569) defines an action in rem thus: "An action or proceeding in rem has for its subject specific property which is within the jurisdiction and control of the court to which application for relief is made. The action proceeds against such specific property, and its object is to have the court define the rights therein of various and conflicting claimants. Jurisdictional control of the property affords the basis for service beyond its jurisdiction upon those who may be interested in its disposition. The result of such an action is a judgment which operates upon the property and which has no element of personal claim or personal liability." [2] Upon the argument, being at least in a general way advised of this definition or rule, I was much impressed that that test would negative this action for the reason that the alleged fund, viz. the $15,000 of the settlement, was by the complaint alleged to have been actually paid over to the appellant, and therefore of necessity could not be in the possession of the other defendant when the action was commenced, and that therefore the action should be deemed one in equity to charge the Director General with the amount of plaintiff's lien, upon. the theory that he, in violation of plaintiff's right, had paid the entire fund over to the defendant McDermott, and that therefore the action was really one to enforce against the Director General a personal liability. This means that I was disposed to regard the case as practically like the Hanna Case, 'supra. However, I find that, as claimed by the learned counsel for respondent here, it has been held clearly by our courts in this state that under such circumstances and in such an action the defendant company (here the Director General) must conclusively be presumed to have retained in its actual possession enough of the settlement fund to meet and discharge the lien. Sargent v. McLeod, 209 N. Y. 360, at page 365, 103 N. E. 164, 52 L. R. A. (N. S.) 380; Oishei v. Pennsylvania Railroad Co., 117 App. Div. 110, at page 114, 102 N. Y. Supp. 368, affirmed without opinion 191 N. Y. 544, 85 N. E. 1113. [3] The latter case was precisely like this, except that, while the accident happened in the state of New Jersey, the original action was brought in this state, and presumptively the settlement made therein. I cannot conceive that that makes any difference. This action as brought is clearly one in rem, and no personal judgment against the appellant is asked. It seems to me that, if it must be conclusively presumed that the defendant, the Director General, has actually retained and still has in his possession the identical $5,000 upon which the plaintiff claims a lien, plaintiff may maintain his action in this state to foreclose his lien upon that fund as "one affecting specific personal property," "which is within the jurisdiction and control of the court," as be (189 N.Y.S.) ing in the actual possession of the defendant, the Director General, and that by personal service upon him such property is brought within the jurisdiction and control of this court. It seems to me that it can make no difference that the right to the lien herein arises under the New Jersey statute instead of under our own; the two being substantially the same. The controlling point is that the fund upon which the lien. is asserted appears in the eye of the law to be here, although in fact we well know that it is not. This appears to be a case where the doctrine or convenience of a legal fiction still survives. Of course, in this case the question of the reasonableness of the amount claimed by plaintiff against an estate has not yet arisen. Therefore I advise that the order appealed from be affirmed, with $10 costs and disbursements. All concur. 810 WEST END AVE., Inc., v. HERZOG. (Supreme Court, Appellate Term, First Department. June 13, 1921.) 1. Pleading 36 (3)—Admission of defendant in his separate defense nullified denials in his answer. In an action by a landlord for rent, wherein defendant denied execution of the lease, except that he admitted a certain agreement for lease under duress, admission in the separate defense that plaintiff landlord represented it was unable to obtain a return of 10 per cent. on the property, unless it raised the rent as demanded, and that defendant, relying on such representations of plaintiff landlord, signed the lease, but that such representations were false, etc., held to have nullified the denial of execution of the lease contained in the answer. 2. Landlord and tenant 200 (11⁄2 ) —Housing laws not retroactive. The recent rent legislation, known as the "housing laws," is not retroactive, and does not apply to affect leases entered into before the passage of the laws. 3. Landlord and tenant 31-Tenant, who did not surrender or offer to surrender, cannot avail of landlord's fraud. Defendant tenant, sued for rent, not having surrendered or offered to surrender the premises, his further separate defense of plaintiff landlord's fraud in inducing him to sign the lease cannot be availed of. Appeal from City Court of New York, Special Term. Action by 810 West End Avenue, Incorporated, against Herman Herzog. From an order denying plaintiff's motion for judgment on the pleadings, plaintiff appeals. Order reversed, and plaintiff's motion granted. Argued June term, 1921, before BIJUR, DELEHANTY, and FINCH, JJ. M. S. & I. S. Isaacs, of New York City (Walter M. Weis, of New York City, of counsel), for appellant. Foster & Cutler, of New York City (A. S. Cutler and Charles J. Herson, both of New York City, of counsel), for respondent. For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes |