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price list as furnishing the maximum prices; and it may be that the fair construction of the contract, in the light of the subsequent correspondence, is that it was to be taken in connection with the formal contract, based on plaintiff's letter of December 24th as modified by defendant's reply, and to be considered merely an assurance or guaranty by the defendant to the plaintiff, for his guidance in taking orders in this country, that the prices to be fixed according to the contract would not in any event exceed the prices submitted on the 28th day of March. The price at which the defendant invoiced the two shipments of bulbs to the plaintiff was less than the prices quoted in the list inclosed on March 28th. The invoice price was evidently based on the market price at which bulbs of the same kind and size could be bought in the region of Ollioules at the time of shipment, less the francs and percentages specified in the contract. It appears that the defendant exercised the option, which he reserved in the contract of December 24th as modified, to fill the order, and the price which he claimed therefor was within the price at which the bulbs could be bought in the vicinity of Ollioules at that time. We are of opinion that the defendant acted within his contract rights in thus invoicing the bulbs, and that he was entitled to the price at which they were invoiced. The plaintiff, therefore, was at fault in declining to accept the bulbs on account of an alleged erroneous price; and the plaintiff, not the defendant, is the one who was guilty of a breach of the contract. This should have been decided as a question of law, and should not have been submitted to the jury.

The verdict for the defendant was $5,000. The first two consignments of bulbs, which were attached, were subsequently delivered to and accepted by the plaintiff. According to the allegations of defendant's counterclaim, this delivery was made by defendant's consent, after plaintiff's refusal to accept according to the contract, and after he had attached the goods and threatened to sell the same; and, according to plaintiff's reply, the delivery was made in fulfillment of the contract. The plaintiff did not allege that the bulbs did not conform to the contract, or a tender of them back to the defendant. In these circumstances, the defendant would be entitled to recover on the theory of a delivery and acceptance pursuant to the contract, for the plaintiff, having first wrongfully refused to perform the contract by accepting the bulbs at the contract price, and then having accepted them, was not at liberty to claim that the acceptance was otherwise than under the contract. The invoice price of these goods, together with the cost of packing, freight, and other charges, which the defendant paid, and which the plaintiff was obligated to pay, aggregated the sum of $19,666.04. The defendant also gave other evidence tending to show other damages in substantial amounts for the plaintiff's failure to accept and pay for the balance of the bulbs ordered and shipped pursuant to the contract. It thus appeared that on the undisputed evidence, according to the contract as we interpret it, the verdict in favor of the defendant was grossly inadequate.

The decision of the main question removes from the case many of the questions argued upon the appeal. The other questions that will necessarily arise upon the new trial are the ordinary questions

that arise on a breach of a contract to accept and pay for goods; and, inasmuch as the evidence upon a new trial may be different, it is nei ther necessary nor advisable that we should attempt to decide those questions in advance.

It follows, therefore, that the judgment and order should be reversed, both on the law and on the facts, and a new trial granted, with costs to defendant to abide the event. All concur.

(42 Misc. Rep. 606.)

PEOPLE ex rel. NEW YORK MUT. GASLIGHT CO. v. WELLS et al.

(Supreme Court, Special Term, New York County. February, 1904.)

1. TAXATION-CORPORATIONS-CORRECTION OF ASSESSMENT.

Where a corporation applies to the tax commissioners to correct an assessment, presenting a sworn statement of its assets and liabilities, the tax commissioners must accept the statement as true when not contradicted.

2. SAME-EVIDENCE-CERTIORARI.

On certiorari to review determination of tax commissioners on application to correct an assessment the commissioners must state the evidence on which their conclusion was based, that the court may determine whether it was fairly drawn from the facts established.

3. SAME GROSS EARNINGS.

In determining the amount of an assessment against a corporation, its gross earnings as they appear from a dividend declared during the year are not a proper basis of assessment, unless it is shown that the dividend was paid from the earnings of that particular year.

4. SAME-GAS PIPES-LOCAL TAXATION.

The gas pipes and mains of a corporation laid in the streets and included under the franchise tax law in the state assessment are not taxable by local authorities.

5. SAME-FRANCHISE.

The franchise of a corporation is not to be considered in assessing its taxable capital.

Certiorari by the people, on the relation of the New York Mutual Gaslight Company, against James L. Wells and others, commissioners of taxes and assessments. Assessment reduced.

Guthrie, Cravath & Henderson, for relator.

John J. Delany, Corp. Counsel (David Rumsey, of counsel), for respondents.

SCOTT, J. In my opinion this proceeding cannot be distinguished from People ex rel. Consolidated Gas Co. v. Feitner, 78 App. Div. 313, 79 N. Y. Supp. 975. In this case, as in that, the commissioners were presented with a sworn statement of the assets and liabilities. of the relator, and of the value of such assets. As to such a statement, the Appellate Division said: "If there was nothing to contradict the statement filed by the relator and the testimony of its president, then the commissioners were bound to accept such statement and testimony as true." Neither in that case nor in this did the commissioners accept the statement as true, and in that case it

15. See Taxation, vol. 45, Cent. Dig. § 626.

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was held that their action was not justified by the statements contained in their return as the reasons leading to the result arrived at by them. In that case they stated that they determined the value of the gross assets "upon the earnings of the company, supported by the market rate of the share stock at $190, including the fixed charges of interest upon their bonds and the dividends of 52 per cent. upon their stock." This was held to be insufficient, because it amounted only to a statement of the conclusions at which the commissioners arrived, without disclosing the evidence, if any, upon which they acted, and it was laid down as a rule to be observed whenever the act of the assessors is challenged that they must, in addition to setting forth the conclusion reached by them, also set forth the evidence upon which the conclusion is based, to the end that the court may determine whether the conclusion was fairly drawn from the facts established, or whether they acted arbitrarily in the matter. The commissioners' return in the present case shows that they adopted two methods of determining the value of the relator's given assets. By the first method they took the capital at par as $3,500,000, and, "on account of the market value of the stock of the relator being $210 per share, we determined that this indicated an added value of $3,850,000," thus making the total value of the relator's estate $7,350,000. The reliance upon market value of the share stock of a corporation as evidence of the actual value of its assets has been repeatedly condemned by the courts, and has been declared by the Court of Appeals to be the "most deceptive and treacherous test," to be resorted to only in those rare cases, in which a better means or truer test of valuation is not obtainable. People ex rel. Union Trust Co. v. Coleman, 126 N. Y. 433, 27 N. E. 818, 12 L. R. A. 762. Furthermore, the commissioners do not return how they ascertained the market value of the share stock, and in this aspect the present case presents one of the same features commented upon in the Consolidated Gas Company Case. The second method of ascertaining the value of the total assets is thus stated by the commissioners:

"We ascertained that the company had earned during the year preceding the second Monday of January, 1902, nine per cent. upon its capital stock, being the sum of $315,000, and we were informed and believe that the said company was capable of earning the said sum annually. From our general knowledge of the value of properties of this kind, and of the sums for which such properties, under ordinary circumstances, would sell, we believe that the entire plant or estate of said corporation would, under ordinary circumstances, sell for a sum which would produce four per cent. per annum upon the invest ment, and therefore, by capitalizing the actual earnings of said company at four per cent., it appeared that the fair market value of the entire estate of this corporation, including franchises, was $7,875,000."

This statement differs only in elaboration from the statement in the return of the Consolidated Gas Company Case that the commissioners had determined the value of the gross assets "upon the earnings of the company." The same difficulty presents itself in this case as was pointed out in that, to wit, that the commissioners did not show how they ascertained the amount of the gross earnings, unless from the company's statement as to the amount of dividend paid dur

ing the year; and it may be taken as well settled that the mere declaration and payment of a given sum by way of dividend does not, by itself, raise a presumption that the corporation had earned, in the year for which the dividend was so declared and paid, the amount of the dividend, for, as suggested in the Consolidated Gas Company Case, the dividend may have been paid from a surplus accumulated in prior years, and there may not have been any dividend at all earned in the particular year for which it is paid. The commissioners' statement that they were "informed and believe" that the company was capable of earning the amount of the dividend every year goes for nothing, in the absence of any disclosure of the sources and nature of their information. For the reasons above stated, and following the decision of the Appellate Division of this department in the case above cited, which finds support in the many cases referred to in its opinion, I am constrained to hold that the commissioners' assessment was erroneous. Upon the trial the relator moved upon the petition and return for relief. The defendants, upon the same papers, moved for the dismissal of the writ. Neither side moved for the taking of testimony or the appointment of a referee, and no suggestion was made by either side that a reference back to the commissioners would result in the presentation of any further facts than those presented by the papers. It becomes the duty of the court, therefore, to determine, upon these papers, the amount by which the assessment should be reduced. The relator's statement filed with the tax commissioners showed that the value of its total gross assets was $4,511,666, which was made up of real estate of the value of $2,721,750, and "personal property" of the value of $1,789,916. It appeared, however, from a supplementary statement, also filed with the commissioners, that the value of the real estate as given in the first statement included mains and pipes in the streets valued at $768,290, which had been included in the state assessment under the franchise tax law (Laws 1896, p. 795, c. 908), and was therefore not taxable by the local authorities. This would leave the total value of the assets liable to assessment, excluding the franchise and property included in the assessment of the franchise, $3,743,376. It is conceded on all hands that this amount is subject to the deduction of $3,125,011.27 for the assessed value of its real estate, debts, investment in city bonds, and 10 per cent. of the capital stock. This leaves the sum of $618,364.73 as the amount at which the relator's assessment should have been fixed. The assessment must therefore be reduced to that sum.

Ordered accordingly.

(42 Misc. Rep. 632.)

LE BOEUF et al. v. GRAY et al.

(Supreme Court, Trial Term, St. Lawrence County. February, 1904.) 1. PARTITION-ESTOPPEL BY PLEADING.

An owner of an undivided share in land, subject to the lien of a judgment recovered against his grantor, sued for partition, and made the judgment creditor a party; asking that the proceeds of the sale be divided. Thereafter the complaint was amended, leaving the allegation sub

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stantially the same, and the case was pending until there was not time, under the statute, for the judgment creditor to obtain leave to issue exe cution on the judgment, made necessary by the death of the judgment debtor. Pending the action the judgment was assigned, and the surro gate refused leave to the assignee to enforce the judgment, as its lien would expire before a sale could be had. Held, that plaintiff was estopped to assert by an amended complaint that the adjudication of the surrogate freed his share, as that of a purchaser in good faith, from the lien of the judgment.

2. SAME-SUPPLEMENTAL COMPLAINT.

Where a new cause of action arises after the action is brought, the proper way to take advantage of it is by leave to serve a supplemental complaint.

Action by Evariste Le Boeuf and others against Miranda Gray and others for partition. Judgment entered.

J. P. Kellas, for plaintiff.

C. S. Ferris, for defendant George G. Gillette.

JOHN M. KELLOGG, J. The defendant Gillette, the owner of a judgment recovered August 16, 1893, against the plaintiff's grantor, asks that provision be made in the judgment of partition herein for the payment of said judgment, to which the plaintiff objects on the ground that he is a subsequent purchaser of the premises from the judgment debtor, and that said judgment ceased to be a lien August 15, 1903. Administration was had upon the estate of the judgment debtor March 16, 1900, and by virtue of section 1380 of the Code of Civil Procedure the statutory lien of the said judgment, which otherwise would have expired August 15, 1903, was continued three years and six months from the date of such administration, and terminated September 15, 1903. In partition it is optional with the plaintiff, under section 1540 of the Code of Civil Procedure, whether he will make a party having a lien upon an undivided share or interest in the property a defendant or not. The plaintiff made the then owner of this judgment a party, serving upon him a verified complaint June 6. 1903, alleging the said judgment; that the plaintiff is the owner of an undivided one-sixth of said premises, subject to the lien of said judgment; and that the premises consist of a farm, which cannot be divided, but must be sold-and asked judgment for the sale of the farm, and that the proceeds be divided between the respective parties according to their shares, rights, and interests. At the time the summons and complaint was served the owner of the said judgment had 110 days remaining, which gave ample time to collect the judgment by execution before the lien expired. On June 12, 1903, a supplemental and amended complaint was served by the plaintiff, containing substantially the same allegations and prayer for relief; and on August 1st another amended complaint was served, containing substantially the same allegations and prayer for relief. When this latter complaint was served there were but 45 days remaining, not giving time to obtain leave to issue execution and effect a sale on the judgment before the statutory time expired; and an execution ought not to issue against an estate for the sale of real estate unless there

12. See Pleading, vol. 39, Cent. Dig. §§ 832, 836.