Utter v. Stuart.

JAMES, J. The plaintiff sets forth in his complaint that on the 25th of January, 1854, he entered into a written agreement with the defendant for the purchase of a lot of land, he to pay therefor $300 and interest, $25 at date, $75 at four months, and the balance in one and two years thereafter; that he made the first and second payments, and part of the third; that in June, 1857, he offered to pay the balance, which was declined; that he thereupon tendered the balance and a deed, and demanded its execution, which was also refused, for the reason, as alleged, that the defendant had sold and conveyed the land to another. The plaintiff then demanded a return of the money paid, which was also refused; wherefore judgment for the money advanced is demanded.

The answer admits the agreement as set forth in the complaint, the payments to the amount of $158, and denies all the other allegations. It then sets up as a defense, that until the last payment became due, the defendant was ready and willing to perform said agreement, but the plaintiff neglected to perform the same on his part; that thereupon the said defendant elected to consider the contract absolutely void, &c.

On the trial, the proofs showed the payment of the first and second installments, and $58 on the third, in all $158; also the offer, tender, demands and refusals, as alleged in the complaint. It further appeared that on the execution of the agreement, the plaintiff was let into possession of the premises, and so continued until April, 1857. In May, 1855, the plaintiff left the country, and remained absent until June, 1857; that the defendant made diligent inquiry and search for the plaintiff, but was unable to find him or learn his whereabouts. In April, 1857, the defendant went on to the premises, and demanded the money due and unpaid on said contract, and then and there declared the said contract void, and thereupon re-entered and took possession of said land. In the winter of 1857 the defendant negotiated for the resale of the premises, and on the 15th of June, 1857, sold and conveyed the same. It also appeared in proof that at all times

Utter v. Stuart.

previous to the 15th June, 1857, the defendant was ready and willing to fulfill and perform said agreement.

Besides the usual, ordinary and necessary provisions of a land contract, the instrument executed by these parties contained these provisions: "Provided always, and these presents are upon this express condition, that in case of default of the said party of the second part, &c. in the performance of any or either of the covenants on his part to be performed, it shall and may be optional with the said party of the first part to abide by this contract, or consider it absolutely void. He may re-enter and dispose of the premises, &c., and the said party of the first part shall have the right at any time to recover the interest that may be due upon this contract for the period of actual possession, as rent for the use and occupation of the premises."

The last payment became due, by the terms of the agreement, on the 25th day of May, 1856; but the agreement was not declared void until April, 1857. Therefore, at the time of this declaration, the legal right to declare the contract forfeited for non-performance existed, independent of the clause in the contract reserving the right to declare it void in case of non-performance.

Had the defendant seen fit to exercise the right of forfeiture, or had he placed his defense upon that ground, and relied upon the sale and conveyance, as evidence of that fact, it is certain that the plaintiff could not have maintained this action. But the defendant, both in his answer and in his proof, places himself upon the right reserved in the contract; and that, as we have seen, was a right to declare the contract void in a certain contingency, and which contingency having happened, the defendant availed himself of.

The plaintiff insists that the defendant, under the power vested in him by the instrument itself, having declared the contract void, it is void ab initio, that is, as though no contract had ever existed. In other words, that the acts of the defendant were a rescission, and that the plaintiff may recover

Utter v. Stuart.

back money paid by him on such agreement, as for money had and received.

The defendant's counsel insists that such is not the fair construction of that clause of the agreement; that the meaning of the parties was that the defendant, upon the plaintiff's default, might be, and consider himself to be, released from the obligation of the contract-might consider it, so far as his promise was concerned, thenceforth void, not void ab initio.

I am of the opinion that the act of the defendant, being as it was exclusively under the authority reserved to him by the contract, must be regarded as a rescission of the agreement. If I am correct in this, then the right of the plaintiff to recover back the payment made, in an action for money had and received, is undoubted. (Raymond v. Bearnard, 12 John. R. 274. Id. 363. Green v. Green, 9 Cowen, 46. Battle v. Rochester City Bank, 4 Comst. 91.

In all cases where a party, having it in his power, cancels a contract, or declares it void, he should restore the other party to his former right, by repayment of money, or return of property, received on such contract; and failing to do so, he is liable to an action for its recovery. (Penny v. Cameron, 1 Greene's (Iowa) Rep. 380. 6 Gill & John. 424, 15 Mass. Rep. 319. 26 Verm. Rep. 476.)

The plaintiff is therefore entitled to recover in this action the amount of the money paid, less the price agreed for the rent of the premises.

[ST. LAWRENCE SPECIAL TERM, October 19, 1858. James, Justice.]

THE PEOPLE OF THE STATE OF NEW YORK, by their Attorney General, vs. JAMES BOWEN and others.

The governor may approve and sign a bill after the adjournment of the legislature, so as to render the same valid and binding as a law.

The act of the legislature, entitled "An act to incorporate the Metropolitan Gas Light Company of the City of New York," passed April 17, 1855, creating a corporation with authority to lay their pipes in the streets &c., for the purpose of conducting gas &c., upon their obtaining the permission of the two boards of the common conncil, was not unconstitutional and void, either because it established a monopoly in the trade or business of supplying gas within the city of New York; or because it took, for the use of the gas company, the streets or easements or privileges in the streets of the city, being the property of the corporation of the city, without making or providing for compensation to the city, and without the consent of the corporation of the city; or as coming within the constitutional prohibition against the creation of corporations by special acts.

The ninth section of that act, by which it is provided that "the said company shall be deemed to be organized when the president shall be elected, and shall be deemed to be in practical operation from the time the permission and authority provided for in the first section is obtained," was intended to relieve, and did relieve, the corporation from the provision of the revised statutes requiring corporations to organize and commence the transaction of their business within a year.

D

EMURRER to complaint. The opinion of the court contains a statement of the facts stated in the complaint, and of the legal questions raised by the demurrer thereto.

Monell, Willard & Anderson, and Wm. M. Evarts, for the plaintiffs.

M. S. Bidwell, E. P. Cowles and W. Hutchins, for the defendants.

SUTHERLAND, J. This is an action in the nature of a quo warranto, against the defendants, for assuming to be, and acting as a corporation, without authority of law. The complaint alleges that the defendants have associated themselves together and claim to be a corporation, and are unlawfully acting as a corporation, under an alleged act of the legislature of the state

The People v. Bowen.

of New York, entitled "An act to incorporate the Metropolitan Gas Light Company of the City of New York," passed April 17, 1855; but further alleges, that although the bill of said alleged act passed the assembly on the 5th day of April, 1855, and the senate on the 13th day of April, 1855, yet it was not approved of, or signed by the governor, until the 17th day of April, 1855; and that the legislature adjourned without day on the 14th day of April, 1855, and was never thereafter in session during that year. By an averment of the complaint, the act in question (Sess. Laws of 1855, p. 1039) is made a part of the complaint.

By section one of the act, James Bowen and others, (the defendants in this action,) and their present and future associates, are created, constituted and declared to be a body corporate and politic, by the name of "The Metropolitan Gas Light Company of the City of New York," with authority to lay their pipes in the streets &c., for the purpose of conducting gas, &c.; but this can only be done upon obtaining the permission of the two boards of the common council of said city. The complaint further alleges, that in the month of June, 1855, the defendants, pretending to act as a corporation, under the name of "The Metropolitan Gas Light Company of the City of New York," presented their petition to the board of councilmen of the city of New York, praying for permission to lay conductors through the streets &c., for the purpose of conducting gas through the same. That on the 12th day of September of the same year, the board of councilmen passed a resolution granting such permission, but that on the 8th day of December, 1856, the board of aldermen non-concurred, and the resolution was lost. That on the 20th day of December, 1858, the said board of councilmen passed a resolution granting such permission, which resolution is set out in the complaint, and that such resolution was concurred in by the board of aldermen on the 27th day of December, 1858. The complaint insists that the defendants and their asso