Case Name: Lewis Lowenstein et al., as Executors, etc., Plaintiffs, v. Herman Schiffer et al., Defendants
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1899-11
Citations: 29 Misc. 477
Docket Number: 
Parties: Lewis Lowenstein et al., as Executors, etc., Plaintiffs, v. Herman Schiffer et al., Defendants.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 29
Pages: 477–481

Head Matter:
Lewis Lowenstein et al., as Executors, etc., Plaintiffs, v. Herman Schiffer et al., Defendants.
(Supreme Court, New York Special Term,
November, 1899.)
Stay — A junior action, between the same parties, will not be stayed pending an appeal in a prior action, where the decision of the appeal will not determine the controversy.
Where the executors of a deceased partner bring an action to recover of surviving partners in possession and enjoyment of the firm assets, his interest therein, as modified by partnership articles which permit the survivors to purchase that interest, in case of his death, on a certain basis of valuation, the pendency of an appeal, to the Court of Appeals, in an action begun earlier by the survivors against the executors and designed, among other things, to enforce the right of the former to purchase the said interest of the deceased, affords no reason for staying the action of the executors until a decision of said appeal is made, where a consideration of the pleadings, and of the judgments, in both actions, clearly indicates that that decision, when made, cannot effectually determine the controversy, and that its final determination must be had in the action brought by the executors.
Motion to stay further proceedings in this action until the decision of an appeal now pending in the Court of Appeals in another action between the same parties.
Parsons, Shepard & Ogden, for plaintiffs.
G-uggenheimer, Hntermyer & Marshall, for defendants.

Opinion:
Scott, J.
This is a motion to stay further proceedings in this action until the decision of an appeal now pending in the Court of Appeals in another action between the same parties. The plaintiffs are the executors of Isaías Meyer, who, with the two defendants* composed the firm of Pelgram & Meyer. The copartnership articles provided that on the death of either partner the surviving partners should have the option of purchasing the interest of the deceased at a valuation arrived at in a manner provided by the articles. Isaías Meyer having died, the defendants elected to purchase his interest in the business, and so notified his executors, the plaintiffs. Steps were thereupon taken to determine the value of Isaías Meyer's interest. The defendants, having made an inventory and appraisement, fixed the value of this interest at $609,000. The copartnership articles also provided that the value of the interest of a deceased partner, in case of a purchase by the survivors, was to be paid in annual installments of $50,000 each, negotiations were entered into between defendants and certain of the plaintiffs looking to a modification of the amount to be paid and of the manner of payment, and an agreement was prepared providing for a purchase of Isaías Meyer's interest in the firm for $585,000, payable in installments different as to amount and time of payment from those specified in the copartnership articles. This agreement was never executed by all the plaintiffs, was never delivered and never became operative. • The defendants here thereupon commenced an action against the plaintiffs in this action in which they set up the copartnership articles, the death of Isaías Meyer and their election to purchase his interest in the business. They also set up the $585,000 agreement and insisted that it had become operative, and they asked judgment in the alternative either that the $585,000 agreement be specifically enforced, or that the defendants (the plaintiffs here) be required to transfer to them Isaías Meyer's interest in the firm on the payment of the value thereof ascertained in accordance with the terms of the articles of copartnership. When this action came on to be tried a,t Special Term, the complaint was dismissed on the ground that the $585,000 agreement had never become operative, and that under the complaint in that action the only relief the plaintiffs could obtain was the enforcement of that agreement, failing which they had established no cause of action for any relief at all. TJpon appeal to the Appellate Division the judgment was reversed, the court holding that while the $585,000 agreement had not been established, yet under the complaint the surviving partners had a right to demand the enforcement of that clause of the copartnership articles, which permitted them to purchase the interest of the deceased partner. Schiffer v. Lauterbach, 7 App. Div. 223. In the meantime the present action was commenced by Isaías Meyer's executors against his surviving partners, in which they set forth substantially the same facts as those alleged in the former action, except as to the valuation of the interest and the execution of the $585,000 agreement, and assert that Meyer's interest in the business was worth much more than $609,000, the amount at which it had been valued by his surviving partners. They ask for an ascertainment of the amount due from defendants under the copartnership articles and the election to purchase, and for judgment for the amount so' found to be due. After the reversal of the judgment in the action by the surviving partners against these plaintiffs that action and the present one were referred to the same referee, before whom they were tried concurrently, although he made separate reports and separate judgments were entered. Upon the referee's reports judgments were entered dismissing the complaint in the action of Schiffer v. Lowenstein, and awarding the plaintiffs in the present action a much larger sum than $609,000. Upon appeal to the Appellate Division both judgments were reversed (38 App. Div. 178, 636), and new trials ordered in both actions before another referee. In the present action the judgment was reversed because the referee had, in certain particulars, adopted an erroneous principle in ascertaining the value of Isaías Meyer's interest in the assets of the copartnership. Lowenstein v. Schiffer, 38 App. Div. 178. The judgment in the action of Schiffer v. Lowenstein was reversed because a new trial had been ordered in this action, and " The issues arising on the subject of the prior partnership agreement will, therefore, be considered in the executors' (that is, the present) action." 38 App. Div. 636. The executors thereupon appealed to the Court of Appeals from the order for a new trial in the action of Schiffer v. Lowenstein, giving the requisite stipulation for judgment absolute in case of affirmance. This appeal has not yet appeared upon the calendar of the Court of Appeals, and probably will not do so until a new calendar is made up. The present action is now on trial before the referee appointed by the Appellate Division. The defendants now move to stay further proceedings in this action until the hearing and determination of the appeal in Schiffer v. Lowenstein. If, as they insist, the decision upon that appeal will necessarily determine the issues in the present action, their motion should be granted, for it is well settled that where the decision in one action will determine the rights set up in another action, and the judgment on one trial will dispose of the controversy in both of the notions, a proper case for a stay in one action is presented. An examination of the pleadings and judgments in the two actions now under consideration shows that the decision of the Court of Appeals on the appeal from the order granting a new trial in Schiffer v. Lowenstein will by no means settle the controversy between the parties. Of course, if the order of the Appellate Division be reversed and the judgment entered on the report of the referee be affirmed, nothing whatever will be definitely decided, the complaint in Schiffer v. Lowenstein will be dismissed, and the parties relegated to the present action for a determination of their respective rights. •On the other hand, if the order of the Appellate Division should be affirmed it is not at all apparent that the controversy between the parties will be thereby determined. It is true that the executors have stipulated that, in case of affirmance, judgment absolute may he rendered aganst them. But what judgment? If the complaint in Schiffer v. Lowenstein asked for only one form of judgment, the final judgment to be entered would, of course, be that asked for In the complaint. In fact, however, the complaint asks for alternative and inconsistent relief. Either that the $585,000 agreement be enforced, or that the amount to be paid to^ defendants for Isaías Meyer's interest in the action be ascertained by the court in accordance with the terms of the copartnership articles. Hence, it appears that it is by no means certain that the parties will be any nearer the determination of their controversy after the decision of the Court of Appeals than they are at present. It is urged that the present action should be stayed, because the same relief asked in it can, ultimately, at all events be obtained in the action of Schiffer v. Lowenstein, and because that was the action first brought. It is undoubtedly the general rule that where one of two actions is to be stayed the one first brought will be permitted to proceed, rather than one subsequently commenced. This rule, however, is not inflexible, and is to be applied only when substantial justice to the parties will be furthered thereby. If the Court of Appeals should reverse the order of the Appellate Division in Schiffer v. Lowenstein, that action would be disposed of, and no affirmative relief could be given in it to either party, and the determination of the controversy between them would be relegated to the decision, of the present action. On the other hand, if the order of the Appel late Division should he affirmed hy the Court of Appeals, and it should he determined that the final judgment to he entered was the alternative one that the value of Meyer's interest be ascertained by the court, then the parties would be only at the commencement of the same litigation which is now going on before the referee in the present action. Under the pleadings in the present action the whole controversy can be, and, if the action be permitted to proceed, must be, determined. To stay this action pending the appeal in the other action would merely postpone, by the length of time necessary to reach the appeal in the Court of Appeals, the settlement of the differences between the parties. To do this would be inequitable. It is conceded on all hands that the value of Isaías Meyer's interest in the firm's assets was very large. Whatever that value is the executors are entitled to payment or security. As the matter stands, while these litigations go on the surviving partners are in possession and enjoyment of 'Meyer's interests in the firm assets, while his executors have neither the value of that interest nor the security for its payment. They are entitled to an affirmative judgment fixing the value of the testator's interest and providing for its present or future payment to them. Such a judgment can be obtained most quickly in the present action. Motion denied, with ten dollars costs.
Motion denied, with ten dollars costs.