Case ID: nys_59/html/0306-01.html
Source: Caselaw Access Project
Author: {"author": "McLAUGHIJN, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LEVY v. STANION.
    (Supreme Court, Appellate Division, First Department.
    July 18, 1899.)
    Contempt&emdash;Failure to Obey Order op Court.
    Where persons claiming under a chattel mortgage of a lease of premises and other property put out and exclude a duly-appointed receiver thereof, who is in actual possession under the order appointing him, and, upon contempt proceedings, the court,&emdash;finding that they did not intend to disobey the order,&emdash;instead of punishing them for contempt, directs them to return the property and place the receiver in possession, their failure to obey the last order amounts to a contempt of court.
    Appeal from special term.
    Action by Samuel Levy against Loyal Stanion to dissolve a partnership and for an accounting. From an order denying his motion to punish certain parties for contempt, James J. Nealis, receiver, appeals.
    Reversed.
    Argued before VAN BRUNT, P. J., and BARRETT, RUMSEY, McLaughlin, and ingraham, jj.
    
      Charles W. Coleman, for appellant.
    Gratz Nathan, for respondents.
   McLAUGHIJN, J.

This action was brought for the dissolution of the firm of Stanion & Co., composed of the parties to this action. The appellant, James J. Nealis, was appointed receiver of the property and effects of the firm during the pendency of the action; and, having qualified, he took possession of the assets, which consisted of a liquor saloon located at 831 Eighth avenue in the city of New York, a liquor-tax certificate, and stock, fixtures, etc., therein. After he had taken possession, the respondents Tracy and Freeman, acting in concert with one Greenthal and the defendant Stanion, under the direction of or representing one Everard, who claimed to be the owner of a chattel mortgage covering the property, or some portion of it, including the lease of the saloon, forcibly took the property from the receiver, put him out of the saloon, and locked the doors. The receiver thereupon applied to the court to punish Greenthal, Stanion, and these respondents for a contempt of court. Greenthal and Stan-ion were adjudged guilty of contempt and fined, and the respondents Tracy and Freeman, while not adjudged guilty of contempt, were directed to “forthwith deliver to James J. Nealis, receiver, the license formerly belonging to the defendant Loyal Stanion, and also to put the said receiver in possession of the leased premises, No. 831 Eighth avenue, in the same condition in which they were on May 14th last; that they also turn over to such receiver the money which was taken by them or their agent from said premises on the evening of May 14th last; that they also account to him for any property which may have been taken from said premises since that time.” Tracy and Freeman appealed from this order, but the same was affirmed by this court. Levy v. Stanion, 33 App. Div. 632, 53 N. Y. Supp. 473. Mr. Justice Ingraham, delivering the opinion affirming the order, said:

“The portion of the order appealed from which directs these two persons, who were clearly guilty of. contempt of court, to deliver the property which they had taken from the receiver, instead of punishing them for their contempt, was authorized. The court, apparently satisfied that the appellants did not intend to disobey the order, instead of formally adjudicating that they were in •contempt, with a commitment to the common jail of the county until they had delivered the property which they took from the possession of the receiver, ordered them to do now what it was- their duty to do without an order.”

The respondents having failed in every respect to comply with the order, the receiver again applied to the court to punish them for contempt; and upon the hearing of the motion they sought to excuse their neglect and refusal upon the ground that the receiver was not entitled to the possession of the saloon or the liquor-tax certificate, and that the keys to the store and the stock taken had been delivered to Everard, and therefore they could not put the receiver into possession. The court thereupon sent the matter to a referee, to take proof and determine “whether or not the respondents had been guilty of a contempt of court in refusing to obey the aforesaid orders, * * * and, if so, what damages- had been occasioned to the receiver thereby.” Several hearings were had before the referee, at the conclusion of which he made a report that in his opinion the respondents were guilty of contempt of court, and that by reason of their action the receiver had sustained damages to the amount of $780. The receiver then moved to confirm the report and punish the respondents, which was denied, with $10 costs, and an order was made directing the receiver to pay the referee’s fees, amounting to $110, stenographer’s fees, $30, and a counsel fee of $150. From this order the receiver has appealed.

The order must be reversed. It is difficult to perceive upon what theory the motion was denied. The testimony taken by the referee not only sustains his report that the respondents were guilty of contempt, but it shows a deliberate purpose on the part of the respondents to disregard the rights of the receiver and to disobey the order of the court. Both of the respondents admitted that they had not delivered the tax certificate to the receiver, that they had not put him in possession of the saloon, and that they had not turned over the money or the stock taken from the saloon. This stock, they showed, had been put in a warehouse; and their counsel, on the hearing, announced that the receiver could have it by paying the charges. The testimony not only showed this, but it also satisfactorily established that the respondents could have complied with the order if they had so desired, and that they were acting in collusion with Everard, who claimed to own the lease of the saloon and some of the property taken under the chattel mortgage referred to. They were clearly guilty of contempt of court, and should have been punished accordingly.

The order appealed from must be reversed, with $10 costs and disbursements, the motion to confirm the referee’s report granted, with $10 costs, and the respondents are hereby adjudged to* be guilty of a contempt of court, for which they are hereby fined the sum of $780, to.be paid to the receiver within five days after service of a certified copy of this order personally upon them; and in default thereof they, and each of them, are committed to the common jail of the county, and stand committed until such fine be paid. All concur.