Case Name: George Maitland et al., Respondents, v. The Central Gas & Electric Co., Appellant
Court: New York Court of Common Pleas
Jurisdiction: New York
Decision Date: 1894-03
Citations: 7 Misc. 408
Docket Number: 
Parties: George Maitland et al., Respondents, v. The Central Gas & Electric Co., Appellant.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 7
Pages: 408–409

Head Matter:
George Maitland et al., Respondents, v. The Central Gas & Electric Co., Appellant.
(New York Common Pleas—General Term,
March, 1894.)
Allegations in an answer in an action to recover royalties under a license to manufacture patented articles to the effect that the defendant was induced to enter into the license by fraudulent misrepresentations as to the validity of the letters patent, without an averment that defendant rescinded or surrendered the license and notified the licensor thereof, is insufficient to constitute a defense.
Appeal from judgment of the City Court, General Term, sustaining demurrer to a separate defense.
The action was for the recovery of royalty under a license from plaintiffs, patentees, to defendant.
A separate defense was pleaded which alleged fraud of plaintiffs inducing defendant to enter into the license agreement. The .alleged fraud was the representation of the licensors that the letters patent were valid.
Bewj. BE. Bayliss, for appellant.
A. Walker Otis, for respondents.'

Opinion:
Per Curiam.
The demurrer was well taken. To make this attempted equitable defense good against the action for royalties it ought to contain an averment that, before the royalties accrued, the licensee had notified the licensors that it repudiated or surrendered the license, so that the latter might be in a position to sue for infringements during the period for which they now claim royalties. Marston v. Swett, 66 N. Y. 206; 82 id. 527; Saltus v. Belford Co., 133 id. 499 ; Skinner v. Wood, 140 id. 217; Hyatt v. Ingalls, 124 id. 93. See, also, Hyatt v. Dale Tile Mfg. Co., 106 N. Y. 651, reported in full in 125 U. S. 49, under title Dale Tile Mfg. Co. v. Hyatt.
The present allegations might be entirely adequate in an action to set aside the license for fraud, if defendant brought such an action in a court having jurisdiction to grant that relief; but that relief would date from the time of the decree setting the license aside, and would be no defense in an action for royalties previously accrued. The City Court has not jurisdiction to grant such affirmative equitable relief, and so the allegations of the so-called sejjarate defense are not available in this action as a defense, or for affirmative relief.
The absence of an allegation that before the royalties sued for accrued defendant rescinded or surrendered the license, and notified plaintiffs thereof, makes this defense bad as an equitable defense, or any defense in this action.
If defendant has a good defense of rescission or surrender and wishes to set it up in proper form it must make application to the City Court for leave to amend.
We have only to affirm or reverse the judgment.
The judgment should be affirmed.
Present: Dalt, Oh. J., Bisohoff and Pbyob, JJ.
Judgment affirmed.