#### The Bankers’ Money Order Association, Respondent, *v.*Friedrich Nachod and Others (Impleaded with Alphons Jacobson and Max Hessberg, Both Deceased), Composing the Firm of Knauth, Nachod & Kuhne, Appellants.

(No. 2.)

First Department,

October 23, 1908.

Trial—newly-discovered evidence impeaching witness.

Where at trial the plaintiff’s witness denied that he wrote a letter offered in evidence and signed by an initial difficult to make out, which letter tended to impeach his testimony, and the defendants at trial were unable to show the authorship, they are entitled to a new trial on newly-discovered evidence showing that the letter was in fact written by the witness.

Appeal by the defendants, Friedrich Nachod and others, composing the firm, 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 7th day of January, 1908.

*308*Morgan J. O’Brien [Antonio Knauth, George T. Hogg*and *Harry W. Alden*with„him on the brief], for the appellants.

*Charles F. Brown [James R. Ely, Charles Stewart Davison*and *Andrew J. Dewey*with him on the brief], for the respondent.

Laughlin, J.:

This appeal by defendants is from an order denying their motion for a new trial upon newly-discovered evidence. It is. -the ¡same action in which an; appeal from an order denying a motion for anew •trial on the minutes of the court and'from the judgment were argued and are tó be decided herewith. *(Banker's Money Order Association*v. Nachod, *No. 1,*128 App. Div. 281.) The «nature of the ■action and -the material facts developed on the trial.are. stated in my opinion delivered on the -other appeal and need not be restated.

■ The learned trial justice was of opinion that the case turned on whether the testimony of Goodall, the promoter of the plaintiff, who remained ’ largely interested in the corporation, or the testimony of the defendant Kuhne with respect to what was said at the meeting of the board.of directors of the plaintiff held on' the 4tli day of June, 1901, was accepted by the jury and the .jury were so repeatedly instructed. In the main-charge the jury were several times instructed, in substance, that if defendant Kuhne, acting for his firm, said or authorized to be said at that meeting that they would take and -subscribe or pay for the entire issue of preferred stock — which was testified to positively by Goodall only — then' plaintiff was entitled to a verdict, but that if Kuhne merely promised in effect that they would with the aid of the syndicate assist plaintiff or agreed in behalf of the underwriters to subscribe-for the stock not. sold to banks — which is the effect of Kuhne’s testimony— and would make the subscription a guaranty, then the plaintiff. could not recover. After the ' jury returned into court unable ¡to agree and were urged by the court at some length to make- another effort to agree and the jurors had then-asked -some questions and received further instructions and one of. the jurors» had asked for further instructions on the point as to- whether the 8100,000 was to be paid in cash, the court said, *“*You- really have to; determine whether it was as testified to by Mr.. Kuhne or whether it was as -testified to by Mr. Goodall. I think that is about *309as clear a way as I can put the vital question before you. Do you accept Mr. Kuhne’s statement or do you accept Mr. Goodall’s? It is obvious that one or the other is mistaken. Which of them is mistaken ? That is a question for you to determine. If you accept Mr. Kuhne’s statement you will render a verdict in favor of the defendant. If you accept Mr. Goodall’s statement you will render a verdict in favor of the plaintiff.” In answer to a further question this was reiterated, the court informing the jury in effect that Goodall had testified that Kuhne agreed that his firm would take all of the preferred stock and pay for it in cash, and that Kuhne denied that such was the agreement. It is undisputed that two days after the meeting in question of June fourth a letter known as Exhibit “ Q ” was written on the letter head of the plaintiff under that date and addressed and mailed to each member of the board *of-*directors, including defendant Kuhne, reciting that at the special meeting of the board, held on the fourth instant, the resignation of ' Director Coler was accepted and the defendant Kuhne was elected in his place, and further reciting as follows :

> *“*It was the sense of the Board of Directors that the preferred stock of the Association be offered in amounts of five shares and under to the banks of the country. Subscriptions to the same to be received by Messrs. Knauth, Nachod & Kuhne, New York. It is the intention to commence business on July 1st, when the war revenue tax of two cents on Money Orders is abolished.

> “ A special meeting of the board is called for the 17th inst., at 3:30 o’clock, to be held at the office of Messrs. Alexander & Colby, No. 120 Broadway, for the purpose of electing a new Secretary and to approve the new By-Laws.

> *“*Our Treasurer, Mr. Edwin Goodall, will deliver an address before the North Carolina Bankers’ Association June 21st, on the . subject of *‘*The Plans and System of The Bankers’ Money Order, Association.’

> *“*By order of the President,

> “ ANTHONY STUMPF, *Secretary.*

> “ G.”

The initial was omitted from some of the letters.

This letter forms the basis of the motion for a new trial on newly-discovered evidence. The initial at the end of the letter *310received by Kuhne looked like the letter “ S ” and the defendants went to trial upon the theory that it was written by Stumpf, but.on taking the witness stand he denied that he wrote it and Goodall also in effect denied that he wrote it. The newly-discovered evidence ' shows' that it was written by Goodall, The recital in the letter, if written by-him, tends strongly to impeach his testimony with respect to what occurred at the meeting of June fourth and to sustain- the claim of the defendants concerning the same. The defendants being unable upon the trial to show the authorship of the letter, were sub-' jected to the charge that it was written at the instance of the defendant Kuhne, who was then president of plaintiff, and the claim is made that it was written in the interest of the defendants and it was evidently so understood by the jury, for after they retired the officer in chai’ge of them came into court and said that they wanted “ the letter which the defendant wrote to'himself.” Upon the trial the plaintiff evidently laid stress upon the recital in the letter “by order of the President,” and urged the jury to believe that all of the contents of the letter was written by his direction. The explanation of defendants’ inability to show, upon the' trial, who wrote the letter might be more complete and satisfactory, and in a doubtful case greater diligence would' be required; but as there can be but little doubt that the defendants vrere prejudiced by Goodall’s denial of any knowledge concerning the letter which, if the newly-discovered evidence be true, was written by himself and flatly contradicts him with respect to what occurred at the meeting and on the vital point, the motion should have been granted on such terms as would reimburse plaintiff for the costs and disbursements which were thus rendered fruitless.

The order should, therefore, be reversed, with costs, but since the verdict is to be set aside and a new trial granted on the other appeal, this appeal required decision only to settle the liability 'for costs, and the motion need not now be granted, and it is, therefore, unnecessary to decide upon what terms.it should have been granted.

The order should be reversed, with ten dollars costs and disbursements.

Clarke and Houghton, JJ., concurred ,• Ingraham and Scott, JJ., concurred in result.

Order reversed, with ten dollars costs and disbursements.