Case ID: ny-st-rep_50/html/0678-01.html
Source: Caselaw Access Project
Author: {"author": "Babnabd, P. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

John R. Drake, App'lt, v. The New York Iron Mine et al., Resp'ts.
    
      (Supreme Court, General Term, Second Department,
    
    
      Filed December 12, 1892.)
    
    1. Pleading—Answer.
    In an action "by the holder of certain notes .purporting to be those of a foreign corporation, the complaint alleged that they were issued without authority by defendant W., a stockholder, who charged himself with such notes and authorized the company in writing to apply the dividends to the payment of such notes. The fourth defense of the answer alleged that such notes were a part of a large number of notes negotiated at the same time and in the same manner, and that such authorization included the whole of these notes, and that any right acquired by the writing was acquired by all the holders of all the notes, without preference in favor of plaintiff. Held, that such answer -was a good defense, as far as it went, but merely limited plaintiff to his share of such dividends, and that a demurrer thereto was properly overruled, although it stated a defect of parties.
    2. Same.
    A plaintiff need not bring in parties because a defendant avers that parties are necessary.
    Appeal from interlocutory judgment overruling demurrer to the fourth separate defense in the answers of defendants, Wetmore and Maynard.
    
      Roger M. Sherman, for app’lt;
    
      Barlow & Wetmore, for resp’ts.
   Babnabd, P. J.

The fourth defense in the several answers of Wetmore & Maynard, assignees, is a proper defense so far as it goes, and should be left in the answers. The plaintiff is the owner of notes given in the name of the New York Iron Mine by Wetmore without authority from the corporation to give them. Wetmore Was a large, owner of stock in the company. The complaint states that Wetmore assigned certain dividends on the stock by charging the plaintiff’s notes against himself, and by entry on the books authorized the corporation to apply such’ dividends to the payment of the plaintiff’s notes. The fourth defénse avers that the plaintiff’s notes were part of a large amount of notes all of one general character, and were negotiated at about the same time, and this defense further avers that the entries on the books concerning the whole of these notes were of the same purport and effect, and that any right acquired by the entries was acquired by all the other holders of the other notes without any preference whatever in favor of the plaintiff as against the other holders. It is true that this fourth defense states that there is a defect of parties, but the substance of the answer must remain, whatever the order may be on the trial. If the plaintiff has not a prior lien on the dividend found, but others sharing with him, there is no difficulty in giving the plaintiff judgment for his share. As the pleadings stand, the plaintiff avers a prior lien, and the defendant avers that others must share equally with him. The plaintiff need not bring in parties because a defendant avers that parties are necessary. The demurrer to the fourth defense was properly overruled, but no new parties are needed, and this order is affirmed with the modification that the fourth defense stand as it is.

Ho costs to either party on this appeal.

Dykhan and Pratt, JJ., concur.