Case ID: ny-super-ct_51/html/0071-01.html
Source: Caselaw Access Project
Author: {"author": "Van Vorst, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

CHARLES ENGEL, Appellant, v. J. A. FISCHER, Respondent.
    
      Statute of limitations—“ Return'" of foreign debtor to this country—Exceptions to rule.
    
    The word “ return” in § 401 Code Civ. Proc. containing exception to limitation of actions, applies as well to a person coming from abroad where he has resided, as to a citizen going abroad for a time, and then returning. But the return, in order to set the statute running, must be so public and under such circumstances, as to give the creditors an opportunity, by the use of ordinary diligence and due means, to prosecute the debtor.
    Accordingly, where defendant, in May, 1873, being then a resident of Austria, there accepted a draft and immediately absconded to this country, where he remained in hiding under an assumed name, for the purpose of concealing himself from his creditors, and the draft matured soon after his arrival, and plaintiff, in April, 1882, discovering defendant, brought suit thereon,—Held, that defendant was not entitled to the protection of the statute.
    
      
      Decided December 1, 1884.
    Before Van Vorst and Freedman, JJ.
    ' Appeal from a judgment entered at trial term, upon dismissal of the complaint by a single judge without a jury.
    The facts appear in the opinion.
    
      B. Lewinson, for appellant.
    I. “The word return,’ as applicable to a debtor, it has been held, applies as well to persons coming from abroad, as to citizens of the country going abroad for a temporary purpose and then returning ” (Angel on Limitations, § 206 ; 3 Parsons Contr. 6th Ed. [105]; Ruggles v. Keeler, 3 Johns. 261; Carpenter v. Wells, 21 Bar. 594 ; Bulger v. Roche, 11 Pick. 36 ; Cole v. Jessup, 2 Bar. 313 ; Dwight v. Clark, 7 Mass. 515).
    II. Such an effect should be given, if possible, to the provisions of the statute of limitations as will not impute to the legislature an intention to do an injustice, especially as to clauses in the statute which purport to save demands, where there has been no opportunity of suing the defendant, by reason of his non-residence, absence or otherwise (Crosier v. Tamlinson, 2 Mod. 71; Forbes v. Smith, 30 Eng. Law & Eq. 602; Chandler v. Villett, 2 Saund. 120 ; Sage v. Hawley, 16 Conn. 114 ; Swayn v. Stephens, Cro. Charles, 245 ; Lafonde v. Ruddock, 24 Eng. Law & Eq. 239 ; See opinion of Maule, J.; William v. Jones, 13 East, 440 ; Gilman v. Cutts, 3 Foster [N. H] 384 ; Smith v. Bond, 8 Ala. 386). The intent plainly expressed is, that every creditor shall have six full years to sue in the courts of this State, and that he shall not lose his demand except by such an omission to sue as the law deems voluntary and negligent (2 R. S. 295-299, § 18, 24, 26, 27, 32-37 ; and Code, §§ 380-412 ; Ford v. Babcock, 2 Sand. 519 ; Cole v. Jessup, 10 How. Pr. 515 ; Gilman v. Cutts, supra; Smith v. Bond, 8 Ala. 386 ; Vanlandingham v, Huston, 9 Ill. 125 ; Harden v. Palmer, 2 E. D. S. 172 ; Richards v. Maryland Ins. Co., 8 Cranch, 92 ; Olcott v. 
      Tioga R. R. Co., 20 N. Y. 223). It has been repeatedly held that a defendant who is simply out of the State is beyond seas, so as to bring the demand within the saving clause of statutes, using that phraseology (1 Shower, 91, anon.; Ruckmaboye v. Mettichund, 32 Eng. Law & Eq. 85 ; Lane v. Bennett, 1 Mees. & W. 70 ; Murray v. Baker, 3 Wheat. 341 ; Bank of Alexandria v. Dyer, 14 Peters, 141; Pancoast v. Addison, 1 Har. & Johns. 350). And these clauses have been applied to foreigners who never were in the state until the suit was brought, and who could not “return,” within the literal or ordinary sense of that term (Ruggles v. Keeler, 3 Johns. 267 ; Dwight v. Clark, 7Mass. 515 ; Bulger v. Roche, 11 Pick. 39 ; Van Hemert v. Porter, 11 Metc. 210 ; Graves v. Week, 19 Verm. 179 ; Forbes v. Smith, 30 Eng. Law 6 Eq. 602). So the phrase out of the state embraces all defendants who are beyond its jurisdiction, so as to disable their creditors from commencing actions against them, even though they are within its territory (Sleight v. Kane, 1 Johns. Cas. 76 ; Smith v. Bond, supra). So though their condition was such when the demand fell due that they could neither return, nor even come into the State afterwards ; e. g. where they have died abroad, never having been here (Davis v. Garr, 2 Seld. 124 ; Douglass v. Forrest, 4 Bing. 686 ; Benjamin v. Degroot, 1 Der. 151 ; Lafonde v. Ruddock, 24 Eng. Law & Eq. 239). The above and similar phrases, even when used in saving clauses relating to the absence of the creditor, have been uniformly applied in the same extensive and liberal sense to save the demand (Lafonde v. Ruddock, 24 Eng. Law & Eq. 239; Townsend v. Deacon, 3 Excheq. 706 ; Strithorst v. Graeme, 2 Wm. Bl. 723 ; Williams v. Jones, 13 East, 439). So the word “ person ” in such and like clauses is sufficiently comprehensive to embrace foreign corporations as well as natural persons (Olcott v. Tioga R. R. Co., 20 N. Y. 223 ; Louisville v. Letson, 2 How. U. S. 497).
    III. By similar reasoning, and by like rules of construction, the courts have established the principle, that in order to set the statute in operation and to take a case out of the exceptions created by section 401, the debtor’s return to (i.e., “ coming into ”) the state must be public and notorious (Smith v. Bond, 8 Ala. 386 ; 3 Pars. Contr. *96 ; Angell Lim. § 206 ; Ford v. Babcock, 2 Sand. 518 ; Cole v. Jessup, 19 N. Y. 96 ; 3 Bar. 309 ; Fowler v. Bailey, 3 Mass. 201; Little v. Blunt, 33 Ib. 359 ; Randall v. Wilkins, 4 Ben. 577 ; Fowler v. Hunt, 10 Johns. 464). The answer to the defense of the statute in the cases above cited, as well as the reasoning which overrules such defense on the ground that a clandestine return (“coming”) does not set the statute running, applies with equal if not greater force to one whose intent in coming into the state, just before his debt matures, is for the purpose of concealment and thereby to get the benefit of the statute. Such a “coming” into the state is, in legal effect, no “coming” at all until brought to the knowledge of the creditor. This is a case in which the defense has its origin in a perpetrated fraud. It is a fundamental rule of law that no defense can arise out of fraud, and nó such defense can be sustained (Upton v. McLaughlin, 105 U. S. 640; Rosenthal v. Walker, 111 Ib. 191; Bailey v. Glover, 21 Wall. 349 ; Poillon v. Lawrence, 77 N. Y. 211).
    
      W. & S. W. Fullerton, and C. E. Rushmore, for respondent.
    I. The defendant having been in this state when the cause of the action accrued, and having remained in it until the commencement of this action, a period of ten years, the statute of hmitations has run against the claim (Code Civ. Proc. §§ 380, 382). The only exceptions to the above sections are found in § 401 of the Code. They are : 1st. When the cause of action accrues against the person, and he is without the state; 2nd. After a cause of action has accrued against a person, and he departs from and resides without the state, or remains continuously absent therefrom for the space of one year, &c., &c.
    In this case the cause of action accrued against the defendant, not when he was “without the state ” but when he was within it. Neither has the defendant departed from or resided out of the state. He has remained and resided within it for ten years.
    II. That fraud which it is claimed was practiced by the defendant in concealing himself by a change of name does not prevent the running of the statute (Troup v. Smith, 20 Johns. 32; Allen v. Mille, 17 Wend. 202 ; Humbert v. Rector, &c., of Trinity Church, 24 Wend. 587; Foot v. Farrington, 41 N. Y. 164).
   By the Court.

Van Vorst, J.

The defendant, residing in Austria, in the month of May, 1873, incurred the obligation, as acceptor of the draft which is the subject of this action.

In July, 1873, the defendant absconded from Austria, and came to the city of New York, and “for the purpose of concealing himself from his creditors, assumed a fictitious name, and has ever since borne, and been hiding, under such fictitious name.” The draft matured after the defendant took up lfis residence in New York. In April, 1882, the plaintiff, the owner of the draft, discovered defendant in the city of New York, living under his fictitious name, and demanded payment, which being refused, he commenced this action.

Upon the trial, the plaintiff’s complaint was dismissed upon the ground that the action not having been commenced within six years after the cause thereof accrued, the same is barred by the statute of limitations. The question arises whether the defendant was withmtMs state durmg the period in question, in the sense contemplated by the statute. It has been said that the statute of hmitations “is a shield, and not a weapon of offense.” I am qrnte sure that it was not designed to defeat justice. It should not shelter a man, who, designmg to defeat the vigilance of Ms creditors, comes into tMs state, and conceals himself under a fictitious name, thus domg all in his power to prevent his creditors from reaching and prosecuting him witMn the time limited.

In the construction of statutes, the judge is vested with authority to disregard the letter, in order, in a given case, to attain the ends of justice. This power has been repeatedly asserted, and practiced upon by the highest authority (Lieber’s Hermeneutics, 3 ed., note by the editor, page 285, and cases cited).

If this defendant is shielded by the strict letter of the statute, he is certainly not by its true spirit and intent (Code, § 401).

In decisions with respect to the former statute of limitation, the word “ return,” found in the section above cited, has been held to apply as well to a person coming from abroad, where he had resided, as to a citizen of this state going abroad for a time, and then returning (Fowler v. Hunt, 10 Johns. 464).

It has also been decided that the “return” must not be clandestine and with the intent to defraud creditors, The “return” must be so public and under such circumstances as to give the creditors an opportunity, by the use of ordinary diligence and due means, to prosecute the debtor (Cole v. Jessup, 10 N. Y. 96, 103 ; Randall v. Wilkins, 4 Den. 577; Ford v. Babcock, 2 Sand. 518 ; Fowler v. Bailey, 3 Mass. 201; Little v. Blunt, 33 Ib. 359).

A coming into this state with the design of continuing therein concealed under a fictitious name, to avoid the pursuit of creditors, is in legal effect no coming at all, until the day that he is discovered. The construction contended for by the respondent would make this statute, which was designed to prevent fraud, “the means by which it is made successful and secure.”

The case of Poillon v. Lawrence (77 N. Y. 201), which arose under the bankrupt law, has some analogy. In that case, the bankrupt contracted a debt in one name, and obtained a discharge in a different name, designedly omitting in his proceedings reference to any fact which would disclose that he was the same person who was debtor to the plaintiff. Rapallo, J., said, “It can hardly be supposed that any court would willingly sanction a fraud of that description.” Practically this defendant perpetrated a fraud equally obnoxious. Contracting a debt in a foreign country under his true name, he then comes to this country and lives under an assumed name, in this way to conceal himself from his creditors. Under such circumstances he cannot claim the protection of the statute of limitations.

Troup v. Smith (20 Johns. 33), and other cases cited by the respondent’s counsel, involve the question of a fraudulent concealment of the cause of action, but not of the person of the defendant. That is a wholly different question. The judgment below is reversed, and a new trial ordered, with costs to abide the event.

Freedman, J., concurred.