Case ID: nys_6/html/0371-01.html
Source: Caselaw Access Project
Author: {"author": "Barrett, J. Van Brunt, P. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Jacoby v. Stephenson Silver Min. Co.
    
      (Supreme Court, General Term, First Department.
    
    July 9, 1889.)
    1. Judgment—Payment.
    In an action upon a judgment for about $10,000 against a corporation, of which plaintiff had become owner after several assignments, it appeared that R., a former assignee, was one of defendant’s trustees, and that at a meeting of the trustees, at which R. was present, a statement of the liabilities of defendant was read, signed by R., and entered upon the minutes, in which the liability of defendant to R. was stated at about 81,000, although he was then the holder of the judgment. This statement was to be used in the reorganization of defendant, in which pro vis-
    
      ion was to be made for the payment of its liquidated debts. Held, that evidence of such statement, offered in support of the plea of payment of the judgment, should have been admitted. »
    • 3. Same.
    It further appeared that while E\, another assignee, and who was a stockholder in defendant corporation, was the owner of the judgment, a resolution offered by F. at a stockholders’ meeting was adopted, to the effect that all the debts of defendant, including judgments, should be paid by the issue of certain stock. Held, that the exclusion of such resolution, offered in evidence as the basis of a further offer to prove that the judgment in question had been settled as contemplated by the resolution, was error.
    8. Same.
    More than 20 years having elapsed since the judgment was rendered, evidence that no execution was ever issued on the judgment was admissible on the question of payment.
    á. Same—Res Adjudicata.
    A denial upon the merits of a motion to set aside the judgment, the question of
    • accord and satisfaction and payment not having been included in the scope of the motion, or determined, is not a bar to the consideration of the question of payment on the trial of the action.
    Appeal from special term, New York county.
    Action by Samuel Jacoby against the Stephenson Silver Mining Company. Judgment was given for plaintiff, and defendant appeals.
    Argued before Van Brunt, P. J., and Daniels and Barrett, JJ.
    
      Augustus 8. Hutchins and William A. Cook, for appellant. Poster & Wentworth and John O'Connell, for respondent.
   Barrett, J.

-This case was submitted. It is an appeal from a judgment (rendered upon a direction at circuit) in favor of the plaintiff. The action was upon a judgment recovered in this court in the year 1869 by one Welton for $9,720.31. The defense was a denial of the averment that “no part of the judgment has been paid,” and an affirmative allegation that certain stock of another company (owned and held by the present defendant) was set off to and accepted by the then owner of the judgment, one Robert M. Funkhouser, in full satisfaction and discharge of all his claims against the defendant, including this judgment. It appears that Welton assigned the judgment on the 17th of August, 1869, to one William H. Russell. Russell continued to be the owner until May 7, 1872, when he assigned to Robert M. Funkhouser. Funkhouser retained it until May 11, 1887, when he assigned to Leonidas P. Funkhouser. The latter assigned to the plaintiff on the 20th of June, 1887. Russell died in 1873 or 1874, and none of the persons who had anything to do with the transactions which resulted in the judgment are now living. This action was brought in October, 1887. The defendants sought to prove a state of facts from which, in connection with lapse of time, payment or other satisfaction might be inferred. All the evidence offered by the defendants was ruled out, and the questions presented by this appeal are whether such evidence tended to establish the defense of payment and the accord and satisfaction with Funkhouser.

It was competent for the defendants to show that the judgment had been released or satisfied while in the hands of any one of the plaintiff’s assignors. To that end the acts and declarations of these various assignors, during the period of their ownership, were admissible. Thus, what Russell said or did between August 17, 1869, and May 7, 1872, tending to show satisfaction, or from which satisfaction could fairly be inferred, was proper for the consideration of the jury. The same observation applies to Robert M. Funkhouser from May 7, 1872, to May 11, 1887. Russell was one of the defendant’s trustees, and Funkhouser one of its stockholders. At a meeting of the trustees held in February, 1870, (Mr. Russell being present,) a statement of the liabilities of the company Was read, accepted, and ordered to be entered in the minute-book of the board. In this statement the liability of the company to Russell was stated at but $1,040.77. The defendants offered this statement from their minute-book, arid also offered to show that such statement was actually signed by Bussell. This was excluded, and the defendants excepted.

The evidence tended to show that Bussell’s understanding of his claim against the company did not embrace this judgment. It was a declaration that the company’s liability to him was for an advance of $1,040.77. The judgment was then in his hands, unsatisfied of record. If it had never been settled in any manner, but was a vital obligation of the company, why was it then suppressed? The statement had a most important object. It was to serve as a basis for the reorganization of the company, in which reorganization provision was to be made for the payment of its liquidated indebtedness. We must believe either that Bussell was willing to permit a reorganization in which his judgment was to be left out, or that the judgment had been provided for in some other manner. It seems quite clear that the evidence, though by no means conclusive, and though susceptible of explanation, tended inferentially to establish satisfaction, and that it should not have been excluded.

An exception was also taken to the exclusion of a resolution offered by Funkhouser, and adopted at a stockholders’ meeting held in the year 1873. At this time Funkhouser was the record owner of the judgment. The resolution embraced a scheme for the satisfaction and cancellation of all the debts of the company (expressly including judgments) by the issue of certain consolidated stock. The defendants further offered to prove that the scheme was subsequently executed,—to quote the language of the offer, “that at the meeting thereafter held the debts of the company were settled by a distribution of stock of a certain other company.” This also was excluded. We think these rulings were erroneous, and that the defendants should have been permitted to introduce the resolution offered by Funkhouser and adopted by the stockholders. That was the foundation of the further offer, in substance, to prove that the judgment was subsequently settled by the distribution of the stock authorized by the resolution. The latter was offered in its regular order, and the defendants could not well prove the actual satisfaction of the judgment, under the terms of the resolution, when they were not permitted to prove the resolution itself. It may be that the defendants could not have followed the resolution up by proof of its specific execution with respect to this judgment. They offered to do so, however, and their offer was refused.

The defendants should also have been permitted to prove that no execution had ever been issued upon the judgment. It was a circumstance slight and inconclusive in itself, but proper to be considered in connection with the other circumstances of the case, and in view of the lapse of time and the death of interested parties. The learned judge was influenced in making these rulings by the fact that a motion had been made, prior to the trial, to set aside the judgment, and that that motion had been denied upon the merits. In this, however, there was a failure to distinguish between what was properly before the court for decision upon the motion and the issue in the present action. The questions of payment and of accord and satisfaction may have been incidentally referred to in the affidavits, but they were not within the scope of the motion, and were not determined. Nor could they properly have been determined. That decision was in no sense res adjudioata upon the present issue, and reference thereto only served to confuse the trial, and cause the errors justly complained of. The judgment should be reversed, and a new trial ordered, with costs to appellant to abide the event.

Van Brunt, P. J.

The rejection of the evidence referred to in Justice Barrett’s opinion was clearly error, under the principles laid down in the case of Bean v. Tonnele, 94 N. Y. 381, and cases there cited.

Daniels, J., concurs in the result.