Case Name: SAMUEL HATHAWAY, Respondent, v. HENRY RUSSELL, Impleaded, &c., Appellant
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1880-04-05
Citations: 14 Jones & S. 103
Docket Number: 
Parties: SAMUEL HATHAWAY, Respondent, v. HENRY RUSSELL, Impleaded, &c., Appellant.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 46
Pages: 103–111

Head Matter:
SAMUEL HATHAWAY, Respondent, v. HENRY RUSSELL, Impleaded, &c., Appellant.
Accounting, reference in action for.—Interlocutory judgment, entry of, appeal from,. —Practice.
This action was brought for an accounting by defendant as plaintiff's agent, and was by order sent to a referee to hear and deter- - mine all the issues. After the filing of the referee’s report, which stated, as a conclusion of law, “-that the defendant should he ordered and adjudged to account,” &c., an ex parte motion for interlocutory judgment thereon was made by plaintiff at special term, and an order entered which “ adjudged and decreed that it he referred to the same referee to take and state an account,” &c., and proceeded to specify in detail the manner in which the accounting should be had.
Meld, that the above conclusion of law is a sufficient order for judgment by the referee, as required by section 1022, Code of Civil Procedure.
Also held, that the court below clid not exceed its powers by “ ordering more than a simple judgment that defendant account,” &c., the excess objected to being only a correct statement of the mode of procedure in an accounting, which was binding upon the referee.
It seems, that so far as the rights of plaintiff are concerned,-the above form of judgment is not an adjudication that the reference is to-proceed because the defendant is liable to account.
Whether the said judgment might have been entered by the clerk, qucere.
Further held, that exceptions contained in a case made and settled may be hoard on appeal to general term from an interlocutory judgment.
Upon the facts, held, that the interlocutory judgment should be affirmed, and the reference directed by it should proceed.
Before Sedgwick and Speir, JJ.
Decided April 5, 1880.
Appeal from interlocutory judgment.
The complaint charged that plaintiff, being the owner of the stock, business and good-will of a printing office, at No. 9 Spruce street, in the city of New York, the defendant became and remained his agent in said business, and had entire charge thereof, as foreman or superintendent; that it was agreed between them that “ defendant was to devote his entire time and his best energies to plaintiff’s business, and was to account faithfully to plaintiff for all profits realized in said busi- ■ ness; that defendant had failed to devote, &c., and failed to account to plaintiff for the profits realized ih the business, but had established on his own account, and without the knowledge or consent of the plaintiff, a printing-office, in the same building, &c., in competition with the business of plaintiff ; that defendant had used for his own benefit in the office established by him the types, stocks and materials of plaintiff ; that defendant had, by means of the premises, made large gains and profits, which in equity belonged to plaintiff, and for which gains the complaint demanded that defendant account.
The answer put in issue the allegations of the complaint on which the demand for an accounting was based, and made certain admissions, which are referred to in the opinion.
By order, the action was referred to a referee to hear and determine all the issues.
The referee proceeded to the trial of the action, and reported that the plaintiff was entitled to an account from the defendant of gains and profits made by him, from the printing, &c., of a journal, called The Church Journal, carried on at No. 9 Spruce street. The plaintiff’s attorney, on the filing of this report, moved at special term for interlocutory judgment. So far as the record shows, this motion was ex parte.
Thereupon was entered an order reciting that on reading and filing the referee’s report, and it appearing that an accounting of the printing, &c., oí The Church Journal is necessary before final judgment can be entered in this action, on motion of plaintiff’s attorneys, “Adjudged and decreed, that it be referred to the same referee, &c., to take and state an account, &c.” The order proceeds to specify the manner in which the accounting should proceed before the referee.
After the entry of this order the defendant’s attorney filed exceptions: 1st, to the “form of judgment entered in this action on the 27th day of October, 1879, because it is not in conformity to the referee’s report herein, and is unauthorized as to all that part thereof beyond the directions in the conclusions of law found in said report; 2d, to the entry of any judgment upon said referee’s report, inasmuch as the referee has failed to direct the proper judgment, as required by section 1,022 of the Code of Civil Procedure.
Afterwards, the defendant gave notice that he appealed to the general term from the judgment of the special term entered upon the referee’s report herein.
Thereafter, a case, containing the evidence, exceptions and proceedings, was settled by the referee, and this case comes up, with the other papers, on this appeal.
Gilbert O. Hulse, for appellant.
Lindley & Lindley, attorneys, and Sutherland Tenney and John Lindley, of counsel, for respondent, among other things, urged :
The practice pursued respecting the entry of judgment, and the form of judgment herein, is correct. Vide section -994 of Code of Civil Procedure (by which it is implied that this practice should be followed). 1. As to the mode of taking judgment: it is to be entered as by the court at special term (Hancock v. Hancock, 22 N. Y. 568-570; Currie v. Coles, 7 Robt. 3). 2; As to form: See Wiggin v. Gans (4 Sandf. 646); Palmer v. Palmer (13 How. Pr. 363); Mendorff v. Mendorff (1 Hun, 41); Trufaut v. Merrill (37 How. 531); 1 Barb. Ch. Pr., 327; 2 Van Sant Eq. Pr. 194; 3 Wait’s Pr. 338; Breevort v. Warner (8 How. Pr. 321); Ketchum v. Clark (22 Barb. 319); Story v. Brown (4 Pai. 112).
The several questions,—whether the referee might have proceeded to the accounting under the original order of reference, without a further order; and whether, under the course pursued, the' order for interlocutory judgment should have been mad e, ex parte ; and if not, whether appellant, if aggrieved thereby, should hot have moved to set it aside before appealing, were not before the court. But see Hathaway d. Russell (45 Super. Ct. 538 ; S. T.), note.
The interlocutory judgment-was entered in form as follows :—
“ On reading and filing the report of, &c., bearing date, &c., and. filed herein, on, &c., to whom it was referred to hear and determine the issues in this action, and it appearing to the court that an accounting of the printing or the type-setting of The Ohureh Journal newspaper mentioned in the complaint, from in or about, &c., to and until, &c., is necessary before final judgment can be entered in this action ; now on motion, &c., of the plaintiff, it is adjudged and decreed : That it be referred to the same referee, &c., as referee, to take and state an account of all dealings and transactions between said defendant Henry Russell and the said The Ohureh Journal newspaper or the printers or proprietors thereof, with respect to the printing or type-setting of said newspaper, and with respect to any and all profits arising therefrom, from, &c., to and until, &c., and for the better taking and stating of such account, that the defendant Henry Russell produce and file with said referee within twenty days after service of this judgment on him, an account of all the said business transacted by him in and about The Ohureh Journal newspaper, from, &c., to, &c., said account to be stated by them in the form of debtor and creditor columns ; and that plaintiff be at liberty to surcharge and falsify said account so to be exhibited by said defendant, and to that end may cross-examine said defendant as to said account or any item thereof, either orally before said referee or on written interrogatories to be filed with said referee and served on defendant’s attorney within twenty days after said account is filed, and the sworn answers thereto to be filed with the referee within twenty days after the interrogatories are filed: And for the purpose of the oral examination hereinbefore provided for, the defendant Russell shall attend before said referee at such times and places as said referee shall from time to time appoint. And the said plaintiff and the said defendant Russell are to produce before the said referee, upon oath, all books, accounts, deeds, papers, contracts, vouchers and writings in their custody or under their control relating thereto ; and said referee in taking such account is to make all just allowances to the parties as between themselves; and what on balance of the said account shall appear to be due from either party to the other, is to be paid as the said referee shall direct, and the said referee is at liberty to state and report any special circumstances as well as his reasons for allowing or disallowing any allowances which may be claimed. And it is further ordered that the question of costs as well as all other questions are reserved until the coming in of the report and hearing further directions.”
See Empire Bldg., &c. Association v. Stevens, 8 Hun, 515.

Opinion:
By the Court.—Sedgwick, J.
The statement of the proceedings discloses that numerons and novel matters of practice are involved. The referee to hear and determine proceeded so far as to determine that the plaintiff was entitled to an accounting as to certain matters. Whether he might have proceeded to the accounting without a further order (Ludington v. Taft, 10 Barb. 447), or whether the referee should have re ported as he did, and then an interlocutory judgment have been moved upon notice (Bantes v. Brady, 8 How. Pr. 216), or whether the order entered should have been made ex parte, or whether the appellant, if he be aggrieved by that, should not have before appealing moved to set it aside, or whether, in fact, the so called interlocutory judgment is anything more than an order directing the referee to do what by the first order of reference he was ordered to do, are questions "which have not been brought before the court on this appeal by counsel for either side,—for the reason, it must be-supposed, that if they are not immaterial, the counsel do not wish that the decision of the appeal should turn upon them.
The only points that the appellant's counsel present on the argument, and that concern the former practice of the proceeding, are two. It is submitted, first, that the referee has failed to order any judgment in his report, as required by law and section 1,022 of the Code of Civil Procedure. I do not see that this is correct, in view of the report "that the defendant should be ordered and adjudged to account, &c." This certainly is a judgment directed, and if the objection be, that the referee should have proceeded to the accounting and determined if anything were due, the appellant is not harmed, because the order appealed from directs no more than that he shall do so. It is here to be noticed, that the order appealed from, as drafted by plaintiff's attorney, does not adjudge that the defendant is bound to account, or that the plaintiff is entitled to an account, but it is adjudged, &c., " that it be referred to the same referee to take account, &c." So far as an adjudication of the lights of the plaintiff is concerned, this is not a determination that the reference is to proceed because the defendant is liable to account. Ho objection is taken to the order on this ground. The second point is that the court below exceeded "its powers in the judgment entered," in ordering or decreeing more than a simple judgment, that the defendant account for the profits, &c. The excess, thus objected to, is no more than a description in detail of the correct manner of proceeding in an account. If the order had directed an accounting or an accounting in the usual manner, the referee would have been bound to do as described by the order entered (Wiggins v. Gans, 4 San. 646).
The respondent's counsel does not claim that the order is not appealable, but that as this is an appeal from an interlocutory judgment, it, by section 1,353, Code of Civil Procedure, must be heard upon a certified copy of the notice of appeal and of the papers used before the court or the judge upon the hearing of the demurrer, application for judgment or motion as the ease requires." In this case, I prefer not to pass upon this point, applied, as it is, to a court entering a form of judgment, which perhaps might have been entered by the clerk, immediately upon the referee's report. An examination of the question involves .the construction of several new sections of the Code, as to which the views of counsel were not presented. Both sides have treated the order as if it were an interlocutory judgment, and have joined in the settlement of a case containing the exceptions, and sections 1,349-and 1,350 clearly intend that such exceptions may be heard upon the appeal from the interlocutory judgment (§ 1,336). The merits will therefore be examined.
There were exceptions taken, particularly those that relate to the contents of letters not produced, which might call for decision, if it did not appear, that the facts, without resort to the matters admitted under these exceptions, sustained the conclusion of the referee.
The question was simply whether the defendant received from the Church Journal money which he should, under his agreement with plaintiff, or by reason of his relation to plaintiff, have accounted for and paid over to him.
The answer admitted certain important facts. It admitted that the agreement was that the defendant should manage and superintend the plaintiff's business, and that defendant should be left in undisputed control of the business. It denied that he agreed to give all his time and talent, but the referee found, on sufficient evidence, that he did so agree. It alleged that the proprietor of the Church Journal applied to the defendant to print that journal, and that defendant immediately, conveyed such proposal to the plaintiff, who declined it. The referee found that such was not the fact. The answer asserted that the plaintiff knew that the defendant was printing the Church Journal, The referee found that the plaintiff was ignorant of this.
The answer admitted that the defendant agreed to and did print, on his own account, the Church Journal in the same building where plaintiff's printing office was, and that he was in the habit of using plaintiff's type in printing the Church Journal; and stated in explanation of this, that he used the type of the Church Journal to a greater extent on work done by the plaintiff. The publisher of the Church Journal during the time the defendant printed it, testified that he did not know of any printing material belonging to the Church Journal, except the mail list and the heading of the paper; that it did not have any type or any materials used in printing, and never owned a stick of type. There was proof of the agreement that the defendant should do the type-setting for the Church Journal, and the bills paid to defendant for that averaged $100 a week. There were matters given in evidence which called for explanation from the defendant, but he gave none, and offered no testimony in his own behalf.
On this testimony, I am of opinion that the referee was right in considering that the defendant was bound to do the business of the Church Journal for the plaintiff and not for himself. Indeed the only difference between that and the avowed business for plaintiff, was that he wrongfully did it in his own name. For aught that appears in the case, he might as well claim a right at his option to do for himself, and not for the plaintiff, any other piece of business that offered itself at the plaintiff's printing office.
The interlocutory judgment should be affirmed with costs, and the reference directed by it should proceed.
Speir, J., concurred.