Case ID: ad_138/html/0178-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Scott, J. : \n      Ingraham, P. J:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Oscar B. Bergstrom and Henry A. Taylor, Doing Business under the Firm Name and Style of Bergstrom and Company, Appellants, v. The Ridgway Company, Respondent.
    First Department,
    May 6, 1910.
    Discovery — examination of party before trial—libel—justification — mitigation of damages.
    An order for the examination of a party before trial may be granted only when it appears that the examination is material and necessary to one seeking if, and this means that the evidence to he elicited must be such as will be admissible upon the trial. .
    If in a doubtful case the court can see that the testimony sought to be elicited may prove relevant and admissible, an examination will in general be permitted. Where, however, a question of law is presented as to whether the matters set forth can he proved on trial and it appears that they cannot, an examination as to them will he denied.'
    Where a libel charged that one B. was a member of plaintiffs’ firm; that plaintiffs posed as bankers and "brokers and conducted." a bucket shop, allegations in the answer that H. was ‘‘ associated ” with plaintiffs; that plaintiffs held themselves out as hankers and conducted a business of promoting and selling worthless stock and created fictitious values by “ wash” sales, are insufficient.as a justification or in mitigation of damages, and an examination of plaintiffs in regard thereto will not he allowed. -
    A justification must be as broad as the charge and must justify the precise charge contained in the libel.
    
      A defendant cannot show in mitigation of damages for a specific libel other and disconnected immoralities, but can attack only the general character of the plaintiff.
    Ingraham, P. J;, and Dowling, J., dissented, with opinion. .
    Appeal, by the plaintiffs, Oscar B. Bergstrom and" another, doing business under the firm name, etc., from an order 'of the Supreme Court, made at the New York Special Term "and "entered in the office of the clerk of the county of New York on the 14tli day of March, 1910, denying the plaintiffs’ motion to vacate an order for the examination of Oscar B. Bergstrom as a witness before trial.
    
      Oscar B. Bergstrom, for the appellants.
    
      Clarence J. Shearn, for the respondent.
   Scott, J. :

The plaintiffs appeal from an order denying a motion to vacate an order for the examination of the plaintiff Bergstrom before trial. The affidavit upon which the order for examination is based conforms to all the technical requirements of such an affidavit, and states specifically just what the defendant expects to prove by plaintiff’s testimony. The action is for damages for libel. The answer pleads both by way of justification and in mitigation of'damages the same facts which it now proposes to prove by the deposition of the plaintiff Bergstrom. The objections to the examination urged by the plaintiff are, in brief, that the matters alleged in the answer and concerning which it is desired to examine the plaintiff, constitute, even if true, no defense to the whole or any part of plaintiffs’ cause of action, and do not constitute a partial defense, or a mitigation, or cause for a reduction of plaintiffs’ damages, and that on the trial such testimony, if elicited upon examination before trial, could not be read in evidence. The. principles applicable to an order for the examination of adverse parties before trial have been so often discussed in recent opinions of this court that it is unnecessary to restate them at length. It is sufficient to say, that while orders for such examinations are upheld with much greater freedom than was formerly the case, they may still be granted only when it is made to appear that the examination is material and necessary to the party seeking the examination, and this means that the evidence to be elicited must be such as will be relevant and admissible upon the trial. If it is apparent that the testimony sought'to be obtained cannot be used upon the trial as a part of the case of the party seeking the examination, the order for examination should not be granted, and, if granted, should be vacated on motion. It is not always easy to determine in advance of the trial just what evidence may prove to be relevant and admissible, and the court will not as a rule, in a doubtful case, undertake to construe the pleadings and determine what may and may not be proved under them. In such a case, . if the court can see, that under the pleadings the testimony sought to be elicited may prove to be relevant and admissible as a part of the*case of .the party, whether plaintiff or defendant, who seeks the examination, such an examination will generally be permitted to be had, leaving the relevancy and admissibility of the testimony to be determined on the trial. We are embarrassed, however, by no such difficulty in the present case, for we have before us the libel and the testimony which it is sought to elicit from the plaintiff Bergstrom to sustain the defendant’s pleas of justification and in mitigation. It is true that the. same matters are pleaded in the answer, but this does not necessarily render proof of them material-, because' the question still remains whether they can be proved either in justification or in mitigation of damages. This presents a question of law which can as well be determined now as upon the trial. The libel of which plaintiffs complain was printed in a popular magazine published by defendant in an article entitled Bucket Shop Sharks'.” The libel describes the business of bucket-shop keeping as being that pursued by certain persons styling themselves “ Bankers and Brokers,” who fleece their customers by making pretended sales and purchases of stock, and then charges that: “ While Alexander J. Iialter is one of the members of the firm of Bergstrom & Company, ‘ Bankers & Brokers at.68 William Street, New York, Halter is known to his intimates as * Hippopotamus/ and his picture is in at least one Police Bogues’ Gallery. These are but specimens from the legion of thieves who ply their trade, throughout the United States as keepers of Bucket Shops, while • posing before the public as ‘ Bankers and Broker's.’ ” The plaintiffs, among other things, specifically deny that Halter is or ever was a member of their firm of Bergstrom & Co.; that they.are or ever were brokers; that they have ever done business as brokers, or as Bankers and Brokers,” or have ever engaged in the business of buying or selling stocks on' commission, or have ever held themselves out by advertisement or otherwise as “Bankers and Brokers.” The matters pleaded by defendant first in justification and later in mitigation of damages, and to establish which it seeks to examinine the plaintiff Bergstrom, do not purport' to sustain the statements contained in the libel. It is alleged that iii 1905 Halter1 became “ associated with the plaintiffs in their business ” (how or in what capacity is not stated), while the libel charges that he was “ one of the member’s of the firm.” It is alleged that' plaintiffs held themselves out as “ Bankers,” not as the libel charged “as-‘Bankers and Brokers.’” It is further alleged that the principal business engaged in by plaintiffs was “ the promotion of corporate enterprises * * * and the marketing of the capital stock of mining companies; ” that such stocks, as plaintiffs and Halter knew, were practically worthless, and had no market value, and that plaintiffs attempted to create a fictitious market value by “wash” sales on the curb and other devices. These practices, if indulged in by plaintiffs, were highly reprehensible, and perhaps some of them were criminal, but they were. not what the libel charged the plaintiffs with, and bore no relation to the equally reprehensible business of “ bucket-shop keeping,” which is what the libel specifically charged against plaintiffs. That this is the precise charge in the libel is confirmed by the defendant’s brief, in which it is said that “ The sting of this libel is that plaintiffs fleeced the public by bucket shopping.” The term “ bucket shopping ” has come to have a well-defined meaning, and has even been defined by judicial utterances as “a place where wagers are made on the fluctuations of the market price of grain and other commodities.” (Bryant v. Western Union Tel. Co., 17 Fed. Rep. 825; Smith v. Western Union Tel. Co., 84 Ky. 664.) There is nothing in common between such a business and that which the answer charges the plaintiffs with carrying on. They, differ radically in manner and method. It seems to be certain that the matter thus pleaded in the answer, and sought to be elicited upon the plaintiff’s examination, is insufficient as a justification and could not be received in evidence in support of the plea of justification, for a justification must be as broad as the charge, and must justify the precise charge contained in the libel. (Odgers Lib. & Sland. [4th ed.] 173.) As was said in Skinner v. Powers (1 Wend. 451): “A charge of misconduct of a specified kind is not justified by proving the plaintiff guilty of misconduct of a similar character. If the plaintiff is charged with perjury in the libel, the defendant cannot prove him guilty of larceny.” The same allegations are pleaded in a separate defense both in mitigation and reduction of damages. We find the same objection to the admissibility of the proposed evidence under this plea. It does not tend to prove the libel even in part, or in any degree tend toward such proof. The rule upon this subject is well settled. In Mattice v. Wilcox (147 N. Y. 634) the Court of Appeals said :'“ Mitigating circumstances are those which, while not proving the truth of the charge, do yet tend in some appreciable degree towards suelí proof and thus permit of an inference that defendant was not actuated by malice in his charge. They must be of .such a nature as to' show that defendant, though mistaken, believed the charge' to be true when it was made. The mitigating facts must be connected with or bear upon the defamatory charge. * * * The circumstances must otherwise be such as tend to disprove malice by showing that the words were spoken in the honest belief that they were true, with some reason for such" belief, and without malice or evil design.” So, also, the same' court said in Hamilton v. Eno (81 N. Y. 116, 128): “ Bone of these things could lessen the responsibility for charging the plaintiff with having taken a- bribe. The matter that will serve to mitigate damages must be connected with or bear upon the defamatory charge. If the defendant had set up facts which had a natural tendency to induce belief that the plaintiff had taken illicit.reward, or if he had averred that from all or' any of the facts averred in his answer he was led to and had that belief when he made his publication, he might ask that such be considered in mitigation of damages. This case was otherwise. There was nothing in the matter stated in the last paragraph of the defendant’s answer that tended to prove the truth of the charge, or to show that there was induced in the defendant a belief of the truth of it.” Bor would the evidence be admissible, in reduction of damages, as tending to show the plaintiff’s general bad character, for “ It is well settled that a defendant cannot show, in mitigation of damages for a specific libel, other and disconnected immoralities, but can attack only the plaintiff’s general character.” (Holmes v. Jones, 147 N. Y. 68.) The matters pleaded in the 6th paragraph of the answer would be clearly inadmissible under a plea of mitigation. (Oakes v. Star Company, 119 App. Div. 358.) Our conclusion is that none of the testimony which it is sought to elicit from the plaintiff Bergstrom would be admissible upon the trial in support of the defendant’s case. It is not, therefore, material and necessary within the meaning of the Code and the General Buies of 'Practice. (Code Civ, Proc. § 870 et seq.‘ Gen. Rules Pr. rule 82.)

It follows that the order appealed from must be reversed, with ten dollars costs and disbursements, and the motion -to vacate granted, with ten dollars costs.

McLaughlin and Clarke, JJ., concurred; Ingraham, P. J., and Dowling, J., dissented.

Ingraham, P. J:

(dissenting):

I dissent. The issues which are to be tried are those presented hy the pleadings. If the pleadings present an issue to be tried then either party is entitled to examine witnesses to prove the facts alleged, and on an order for the examination of a party before trial I do not see that the court should determine whether a cause of action or defense is sufficient, leaving that to be determined upon the trial where a determination can be reviewed. It is conceded in the prevailing opinion- that these matters about Avhicli the defendant seeks to obtain the plaintiff’s testimony are pleaded both in justification and in mitigation of damages. -. By the prevailing opinion the court attempts to determine that these facts are not available to the defendant under either plea, the court saying that this presents a question of law which can be as well determined now as upon the trial. It is to this statement that I dissent as I think a party is entitled to have that question determined on the trial so that a determination can be reviewed and not upon a motion of this kind Avliere -there is no review. It seems to me that the affidavit in this case is sufficient under section 812 of the Codé of Civil Procedure and that the defendant was entitled to examine the plaintiff before trial, and the order appealed from properly, denied the plaintiff’s motion to prevent such an examination.

Dowling, J., concurred.

Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.