Case ID: ad_33/html/0405-01.html
Source: Caselaw Access Project
Author: {"author": "Barrett, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The American Copper Company, Appellant, v. George Lowther and Others, Respondents.
    
      Supplemental answer — a delay of more than a year in applying for leave to serve it constitutes laches — effect of the inadvertent entry of judgment against one of several eo-sureties and its subsequent vacation.
    
    A delay of more than a year after knowledge by a party applying for leave to serve a supplemental answer, of the facts proposed to be set forth therein, constitues such laches as requires the denial of an application therefor.
    One of several co-sureties sued upon a guaranty having made default, a clerk in the office of the plaintiff's attorneys, entered judgment against such defendant and an order of severance, notice of "both of which was served upon the attorneys for the' other defendants.
    Upon the case coming on for trial a year later the plaintiff discovered the mistake and induced the court to allow- a juror to be withdrawn, and four days later secured an order vacating the judgment against the defaulting co-surety “ as if the same had never been entered.” Six days later the other defendants obtained an order permitting them to serve a supplemental answer setting up as a defense the entry of the judgment and its subsequent vacation.
    Upon an appeal by the plaintiff from the order allowing the service of such supplemental answer the defendants sought to excuse their laches in waiting for more than a year after the entry of the judgment before moving for the order appealed from, by claiming that the defense relied upon by them was the release and discharge of a co-surety, which defense was not complete until the vacation of the judgment.
    
      Held, that the vacation of the" judgment did nob release the surety against whom it had been inadvertently entered, and consequently did not release the other defendants;
    That the proposed defense was frivolous, as well as highly inequitable, and that the defendants should'not have been permitted to interpose it.
    Appeal by the plaintiff, The. American Copper Company, 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 6th day of June, 1898, granting leave to three of the defendants to serve a supplemental answer.
    
      Charles E. Miller, for the appellant.
    
      John J. Crawford, for the respondent.
   Barrett, J.:

The respondents are co-sureties with one Edward L. Smith upon a guaranty which is set forth in the complaint. The resjDondents defended, but Smith made default. Thereupon a clerk in the office 0'f the plaintiff’s attorneys, supposing that the case was one of several liability, entered an ex pa/rte judgment against Smith and obtained an order severing the action and permitting the plaintiff to proceed against the respondents. He did this without the knowledge of his principals, the plaintiff’s attorneys. . Nothing was collected from Smith, he being in fact insolvent.' The respondents’ attorneys had notice of the entry of judgment against Smith and of the order of severance. They received- this notice on the 1st day of April, 1897. Nothing further was done until- the 18th day of April, 1898, when the action came on for trial. Then, for the first time, the plaintiff learned of the entry of judgment against Smith. After opening his case to the jury, the plaintiff’s counsel asked leave to withdraw a juror, in order that application might be made to the court for an amendment of the complaint. This was granted, with leave to the defendants also to make such application to the court for leave to serve such amended or supplemental pleadings as they might be advised.” The plaintiff did not take advantage of the leave thus granted, nor does it appear from the record in what respect an amendment of the complaint was desired. A few days later, however, namely, on the 22d day of April, 1898, the plaintiff obtained an order vacating the judgment against Smith. “ as if the same had never been entered.” This order was based upon affidavits showing that the judgment was inadvertently entered by the clerk of plaintiff’s attorneys, that the latter never authorized their clerk’s act, and that they had no knowledge thereof until the case was called for- trial four days previously. Six days later the respondents moved for leave to serve a supplemental answer setting up'the entry of the judgment against Smith and the order vacating that judgment, “ by reason whereof,” to quote the jn’oposed supplemental answer, “ the plaintiff discharged and released the said Smith who was a joint obligor and co-surety witli "" * - these defendants (the present respondents) * * * from all liability to the plaintiff for any of the matters and things in the complaint set forth.” This motion was granted and the plaintiff appeals. It was plainly not the respondents’ intention, in this proposed supplemental answer, to plead the entry of the judgment against Smith as a discharge of their liability. This is clearly evidenced by the following extract from their points: The defense set forth in the supplemental answer is not the entry of judgment against a joint obligor, but the release and discharge of a co-surety, which defense was not complete' until the plaintiff, of its own motion and voluntarily, vacated the judgment against Smith.’’ ■

The supplemental answer was undoubtedly formulated, and this concession as to its purpose- and construction made, in view of the respondents’ laches with respect to the judgment. The respondents’ attorneys had full knowledge of the existence of" this judgment for upwards of a year, and yet they made no application for leave to serve a supplemental answer setting up its entry. The- rule is well settled that unreasonable delay in interposing such a defense is a sufficient ground for its exclusion. (Mcdbury v. Swan, 46 N. Y. 200; Holyoke v. Adams, 59 id. 233; Beach v. Reynolds, 53 id. 1; Spears v. The Mayor, 72 id. 442.) It is said that the trial court -gave the respondents leave to serve this supplemental pleading. This, however, is an inaccurate view of what was done there. The trial court simply gave the respondents leave to make such application on the subject as they might be advised. It did not attempt to -forestall the judgment of the Special Term upon whatever application 'the respondents might see fit to make. We do not know precisely what transpired at the trial, but there is absolutely nothing in the record to indicate that the respondents were relieved from their'then existing laches on this particular’ head.

The real claim of the respondents is that, conceding their letches' as to the judgment, there was no laches as to the vacatur.. Again their points are clear and precise. “ In the answering affidavit of plaintiff’s attorney,” they say, “ laches are urged as an objection to the granting of the motion. But there were no laches. The defense set up in the supplemental answer did not accrue until the entry of the-order of vacatur, and the motion was made six days after that time. It is true that the defendants might have set up the entry of. the judgment against Smith as :a defense, and did not do So. But this ought not to preclude them from interposing a different defense which accrued subsequently A ■'

It is . apjwent, therefore, that, the sole question is whether the vacation-, of the judgment constituted a defense. The theory, and. the only theory, upon which it is claimed to constitute a defense is, that- it released Smith. But how did it release Smith ?' The judgment was not satisfied thereby, nor was any of Smith’s property released. Certainly, he cannot claim to be. released by the vacatur. He stands precisely as if no judgment had ever been entered against him. As to him it is, to quote again from the' .order, “ as if the same (the judgment) had never been entered.” If Smith- cannot say that he has been released by the vacating - of a judgment which -was inadvertently entered against him, surely the respondents cannot." There is really nothing in this proposed defense. It is frivolous, as well as grossly inequitable, and the respondents should not have been permitted to interpose it. The case is quite within the principle laid down in Citizens' National Banle v. Weston (81 Hun, 84.) There the plaintiffs attorney by inadvertence or mistake entered judgment against one of several joint debtors. Learning of his mistake, he applied to the court to vacate the judgment, which was done. Leave to set up the entry of this judgment by way of supplemental answer was denied at Special Term, and the denial was affirmed by the General Term. The court, Dwight, P. J., said: “ But we think" the motion was properly denied, because the inclusion of the defendant William Weston in the entry of the judgment was merely inadvertent, and the judgment against him was vacated as soon as the mistake was discovered and before any prejudice to the other defendants, the appellants here, could have resulted therefrom.”

We think, therefore, that the order appealed from should not have been granted. . It is accordingly reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs.

Van Brunt, P. J., Rumsey, Patterson and O’Brien, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and motion' denied, with ten dollars costs.