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at its expiration, and plaintiff was to pay the premium within 30 days and get the policy. The old policy expired December 20, 1894, and the property was destroyed by fire December 29th, and no new policy had been issued. The plaintiff recovered the amount of the insurance, and the Court of Appeals upheld the recovery. In Van Loan v. Farmers' Mutual Fire Ins. Association, 90 N. Y. 280, the applicant applied to a director for insurance, paying the required sum. . The director made the survey and notified the company, but the matter was held in abeyance for the reason that the policy was to be made out in the name of the wife of the applicant, and her first name was unknown. A fire occurred in the meantime, and the defendant was held liable. These cases are decisive of the present one, so far as this aspect of the case is concerned. In fact, the situation is far stronger here, for the plaintiffs, for there was an application in writing prepared in January, which was withheld by the defendant, and there was at least an attempt honestly niade to prepare another, and there was no formal rejection of it. In addition to these circumstances are the acts of Babcock, tending strongly to corroborate the position of the plaintiffs.
So far, we have assumed that the last purported application was rot signed by Loomis. There was proof tending to show he did in fact sign it, but we are free to add that, if to uphold the recovery depended on agreeing with the jury on that proposition, we should have some hesitancy in doing so. On the practically undisputed testimony, however, we think the circumstances show an agreement-a plain understanding—that the property was insured at the time it was burned.
In each written application, Loomis answered the inquiry as to his title or interest by the word “deed,” implying that he was the sole owner of the property. Loomis and his wife testified that they informed Babcock they owned the farm jointly, which is the fact, and supposed he so stated in the application. The jury have found with the plaintiffs on this question. So Babcock, the director, possessed full notice of the ownership of the property.
In the last attempted application, Loomis stated that the premises were incumbered to the extent of $1,800, but did not give the name of the mortgagee. This form was followed in the preceding applications, and no dissent was made by the defendant. By section 13 of the defendant's by-laws it is provided that the "policy may at the request of the insured be endorsed * * * payable to * * * mortgagee as h— interest may appear.” It is not obligatory, and certainly the failure to do so does not relieve the defendant from liability.
We do not deem it important to discuss the other exceptions urged by the appellant. The real mortgagee assigned her interest in the policy to the plaintiffs. The judgment and order should be affirmed, with costs.
Judgment and order affirmed, with costs. All concur.
and 121 New York State Reporter (92 App. Div. 171.)
HOUGHTON V. STINER. (Supreme Court, Appellate Division, First Department. March 11, 1904.) 1. BANKRUPTCY-TRANSFER BY BANKRUPT-SETTING ASIDE-ACTION BY TRUSTEE.
The bankrupt law (Act July 1, 1898, c. 541, 8 60b, 30 Stat. 562 (U. S. Comp. St. 1901, p. 3445]) provides that if a bankrupt give a preference, etc., “it shall be voidable by the trustee, and he may recover the property or its value." Held, that the trustee's action under the statute should be one in equity for an accounting.
Appeal from Special Term, New York County.
Action by Jos. G. Houghton, as trustee in bankruptcy for Alfred T. Simms, against Max Stiner. From a judgment overruling a demurrer to the complaint, defendant appeals. Affirmed.
Argued before VAN BRUNT, P. J., and MCLAUGHLIN, PATTERSON, O'BRIEN, and LAUGHLIN, JJ. Wm. Jno. Barr, for appellant. Walter Large, for respondent.
O'BRIEN, J. The action is brought by a trustee in bankruptcy to recover the value of a stock of goods alleged to have been transferred to the defendant, a creditor, by the bankrupt, when insolvent in fact, and known by the bankrupt and the defendant to be so, within four months of the filing of the petition in bankruptcy, the purpose and intent of the transfer being to give an illegal preference. The defendant demurred to the complaint, and from the interlocutory judgment overruling the demurrer he appeals.
In form, taking the allegations of the complaint and the prayer for relief, the plaintiff brings this action in equity for an accounting; and the specific ground of the demurrer is that the plaintiff has an adequate remedy at law, and an action in equity upon the facts cannot be maintained. The precise question, therefore, is whether a trustee in bankruptcy, who, by appropriate allegations and prayer for relief seeks his remedy, can inaintain an action in that forum, or, as contended by the defendant, is exclusively confined to an action at law. The section of the bankrupt law (section 6ob, Act Cong. July 1, 1898, c. 541, 30 Stat. 562 [U. S. Conip. St. 1901, p. 3445]), so far as material, is as follows:
"If a bankrupt shall have given a preference within four months before the filing of a petition * * * and the person receiving it * * * shall have had reasonable cause to believe that it was intended thereby to give a preference, it shall be voidable by the trustee and he may recover the property or its value from such person.”.
There is nothing in this language, nor is there any provision of the bankrupt law, which prescribes the remedy or the form of action that a trustee is authorized to maintain to enforce the rights invested in him by the section quoted. If we are to be controlled by the weight of precedent, we might multiply indefinitely the citation of cases brought in equity wherein relief such as is here sought was accorded. Schreyer v. Citizens' Nat. Bank, 74 App. Div. 478, 77 N. Y. Supp. 494;
our own jurisdichat may be reditle and possessicase itself whethies
Pearsall v. Nassau Nat. Bank, 74 App. Div. 89, 77 N. Y. Supp. II; Bardes v. Hawarden Bank, 178 U. S. 524, 20 Sup. Ct. 1000, 44 L. Ed. 1175; Jones v. Schermerhorn, 53 App. Div. 494, 65 N. Y. Supp. 999; Stackhouse v. Holden, 66 App. Div. 423, 73 N. Y. Supp. 203; Perry v. Booth, 67 App. Div. 235, 73 N. Y. Supp. 216. On the other hand, we have in support of the appellant's contention the case of Garrison v. Markley, Fed. Cas. No. 5,256, which was an action brought in Michigan under the act of 1867 (Act March 2, 1867, 14 Stat. 517). With respect to that case, however, two criticisms are justified. The first is that under the act of 1867 transfers made within four months were absolutely void, whereas under the present bankrupt law it will be noticed that they are only voidable. The second criticism is that we have no means of determining from that case itself whether the law governing the transfer of title and possession of property and the forms of action that may be resorted to are or are not the same as in our own jurisdiction or that of Connecticut, in which latter state it is alleged the property here in question was transferred. If, however, disregarding these distinctions, it should be held that the Michigan case is directly in point, then, in view of the uniformity with which a contrary practice has been followed in our own jurisdiction, we would not be justified because of an old decision, which does not seem to have been applied or followed under the present bankrupt law, in departing from the practice which has been established in our own jurisdiction. Aside, however, from precedents or cases, we think that, were this an original proposition, the right to maintain in equity such an action as this can be sustained by good and sufficient reasons. The transfer made by the debtor to the creditor was entirely valid when made, and the title to the property passed to the creditor, together with the right to possession. We do not understand that an action at law could be maintained in trover or replevin by one who neither had the title to the property nor the right to possession. It is true that where the trustee elects to avoid the transfer because giving a preference he is entitled to recover the property which has been transferred or its value; but this is quite distinct and different from divesting the creditor of the title and right to possession by the fact merely that the trustee in bankruptcy elects to rescind the transaction. When such election is signified either by demand or, the bringing of an action in equity for an accounting, the creditor then stands in the position of one who holds the title and the right of possession to the property, or its value if sold, as quasi trustee for all the creditors, and as such he can be compelled to account in equity to the one entitled on behalf of the creditors to the property.
Another consideration, as bearing upon the form of action, lies in the fact that it may well be that the transfer from the debtor to the creditor has been evidenced by a deed in writing if it relates to real estate, or by a bill of sale in writing if it has reference to personal property. And as these instruments, valid when made, must necessarily be destroyed and set aside, a phase of litigation is presented of which equity has usually assumed jurisdiction. In other words, the muniments of title under which the creditor holds the title to the property may be an obstacle in the way of the trustee in bankruptcy
and 121 New York State Reporter reaching it, and to that end it may in form be necessary, if not in fact, to have the written muniments of title held to be void. Such relief is granted in an action in equity, and not one at law.
We are not unmindful of the fact that there is no element of fraud in this form of action, and that the theory upon which relief is accorded is, not that the creditor has done anything wrongful in obtaining payment for his debt, because that he could legally do, but the right is given to the trustee in bankruptcy by statute to set aside such payment for the purpose of preventing a preference to any particular creditor within four months of the adjudication in bankruptcy. Apart, however, from the question of fraud, thinking, as we do, that the trustee with respect to property so transferred to a creditor is not, by the mere force of his appointment, invested with the legal title or the right to possession of the property, but that he is permitted in the proper action to regard the transfer as voidable at his election, it follows, we think, that the mere fact of electing does not destroy the rules affecting title, ownership, or possession; and as under them the title and right to possession is in the creditor until such time as he either voluntarily surrenders the same to the trustee in bankruptcy or is deprived thereof by a valid adjudication the trustee in bankruptcy is not, at the outset or the beginning of an action, in a position to maintain an action at law either in trover or in replevin. If neither of these actions will lieand they are the only ones at law that can be suggested—then seemingly the remedy of the trustee would be in equity.
We have been referred neither to principle nor binding authority which should, after the long and uniform practice to which we have referred, incline us to decide for a change; and we think that the disposition made by the learned judge at Special Term in overruling the demurrer was right, and that the judgment appealed from should be affirmed, with costs. All concur.
(92 App. Div. 575.)
COLEMAN v. HAYES. (Supreme Court, Appellate Division, Fourth Department. March 15, 1904.) 1. CHANGE OF VENUE-WAIVER.
A party, by noticing a case for trial at a certain term, and by then appearing and securing a continuance, waives his right to subsequently move
for a change of venue. Appeal from Special Term, Yates County.
Action by John E. Coleman against Charles F. Hayes. From an order granting a change of venue on defendant's application, the plaintiff appeals. Reversed.
This action was commenced by the service of the summons on the 2d day of June, 1902. The venue was laid in the county of Yates. The defendant appeared by attorney, and demanded a copy of the complaint, on the 9th clay of June, 1902, and on the 19th day of July following a copy of the complaint was served upon said attorney. The answer was served on the 7th day of August, and an amended complaint served by the plaintiff on the 14th day of October. The defendant's answer to the amended complaint was served on the 30th day of October, to which the plaintiff served a reply on the 10th day of November, 1902. The plaintiff thereupon filed a note of issue, and caused the action to be placed upon the trial term calendar in Yates county for a term to be held on the 1st day of December, 1902. Both parties noticed the cause for trial at such term, and on the first day of the term the defendant, upon his own affidavit of merits, and of the illness of a material witness for the defense, by his attorney, moved for the postponement of the trial of the issues, and in said affidavit used this language: "That the said witness, who resides at Prattsburg, N. Y., has been seriously ill for several weeks last past, and is now wholly unable to attend this court, or be present at the trial of this action in its order upon the calendar, but the deponent has been informed by Robert J. Scott, M. D., the physician attending the said witness, and verily believes, that the said witness will be able to attend this court by the time of the next trial term appointed to be held at Penn Yan, N. Y., on the third Monday of May, 1903." Thereupon the plaintiff and defendant entered into a stipulation fixing the amount of witnesses' fees incurred by the plaintiff to be paid by the defendant at the sum of $10, and the court entered an order, which, after reciting the application for postponement, opposition on behalf of the plaintiff, and the stipulation as to fees of witnesses, read as follows: "That the trial of the above-entitled action be adjourned to the next regular trial and equity term of this court, appointed to be held in and for the county of Yates, at Penn Yan, N. Y., on payment to plaintiff's attorney of ten dollars costs and witness fees fixed and taxed in the sum of ten dollars. within twenty days.” Subsequently and on the 10th day of December, 1902, the defendant noticed a motion, returnable on the 20th day of that month at Rochester, Monroe county, for an order correcting the order of postponement mentioned in the affidavit of said Thomas (defendant's attorney), so as to make it read as stated therein by said Thomas, and for an order changing the place of trial of this action from the county of Yates to the county of Steuben, on the ground of and for the convenience of witnesses," etc. It appeared by the affidavit of defendant's attorney used upon said motion that when the application was made for the postponement of the trial he stated to the court that he intended to move for a change of venue. Subsequently the Special Term made an order amending said order of postponement upon the ground that it did not comply with the terms of the order as granted by the court, in that it was not intended to set the cause down for trial at the May term, 1903, and upon the affidavits presented by the defendant in support of his motion to change the place of trial the court ordered that the trial be held in the county of Steuben, instead of the county of Yates, wherein the venue was during all the time prior to the entry of such order, to wit, the 12th day of January, 1903. From the order changing the place of trial this appeal is taken.
Argued before McLENNAN, P. J., and SPRING, WILLIAMS, HISČOCK, and STOVER, JJ.
Lyman J. Baskin, for appellant.
McLENNAN, P. J. The sole question presented upon this review requiring serious consideration is whether the defendant, by serving his notice of trial for the December trial term in 1902 to be held in the county of Yates, and by appearing at such term and applying for and receiving the advantage of a postponement of the trial beyond that terın of court, waived his right to inove the court subsequently for a change of venue to another county. In the case of Haiz v. Starin, I N. Y. St. Rep. 553, which was an action brought in the wrong county, and to the removal of which to the proper county the defendant was entitled as a matter of right, unless such right had been waived, the court said:
“The receipt of the extension of time, subject to stipulation by defendant to take short notice of trial for the March circuit in Westchester, was a waivel