Case Name: Emanuel J. Myers, as Trustee for Alexander Stein and George Wishart, Appellant, v. Alexander Stein and George Wishart, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1913-01-10
Citations: 154 A.D. 631
Docket Number: 
Parties: Emanuel J. Myers, as Trustee for Alexander Stein and George Wishart, Appellant, v. Alexander Stein and George Wishart, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 154
Pages: 631–635

Head Matter:
Emanuel J. Myers, as Trustee for Alexander Stein and George Wishart, Appellant, v. Alexander Stein and George Wishart, Respondents.
First Department,
January 10, 1913.
Pleading — action under trust agreement to enforce payment of promissory notes — complaint — superfluous allegations — insufficient defenses — another action pending — failure to controvert allegations of complaint —judgment upon pleadings.
A complaint set forth a good cause of action upon two promissory notes executed by defendant W., payable to defendant S., and alleged that at the time of the execution of the first note W. executed and delivered to plaintiff an instrument in writing whereby he undertook to secure the payment of certain obligations, and therein plaintiff was appointed trustee for the benefit of the defendants herein with certain powers and duties therein set forth. There was an allegation “that no proceedings at law or in equity have been taken by the plaintiff for the enforcement of the provisions of the said agreement.” Judgment was demanded that the property mentioned in the agreement be. foreclosed and the proceeds applied towards the payment of the obligations of W. to S. The answer simply denied the one allegation of the complaint before quoted, which allegation was superfluous because the action affects personalty only, and then set up several defenses which are insufficient in law. It further set up another action at law pending upon the second note, but this action was brought by S. against W. and, hence, was not between the same parties nor upon the identical cause of action.
Held, that plaintiff’s motion for judgment upon the pleadings should have been granted.
Where the allegations of a complaint are not directly controverted by a general or specific denial, they are not put' in issue by a statement merely inconsistent with those facts or from which a denial may be implied or inferred.
Appeal by the plaintiff, Emanuel J. Myers, as trustee, 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 29th day of June, 1912, denying the plaintiff’s motion for judgment on the pleadings.
Gordon S. P. Kleeberg, for the appellant.
Robert A. Inch, for the respondents.

Opinion:
Dowling, J.:
The complaint herein sets forth that on October 17, 1911, at the city of New York, the defendant Wishart, for value received, made his certain promissory note in writing, whereby he promised to pay to Alexander Stein on the 17th day of April, 1912, the sum of $20,000, with interest, and that simultaneously therewith, for a valuable consideration, he executed, acknowledged and delivered to: plaintiff an instrument in writing whereby said Wishart undertook to secure the payment of certain obligations and therein and thereby plaintiff was appointed trustee for the benefit of the defendants herein with the powers, and duties therein set forth. Copies of said note and instru.ment are annexed to the complaint. It is then alleged that on January 20, 1911, Wishart, for value received, made another promissory note in writing whereby he promised to pay to Alexander Stein the sum of $20,000, in one year from said dató, and delivered same to Stein and that no part has been paid. It is further alleged that the first mentioned note was not paid, and that Stein required plaintiff to take proceedings under the conditions of the note, by ' which the trustee was given power to realize upon the collateral deposited under the agreement referred to, by proper proceedings at law or in equity, the security being given to secure payment not only of the note due April 17, 1912, but of any other liability of Wishart to Stein. The complaint further sets forth that plaintiff demanded payment of $20,000 due under the note and the performance of its conditions, but defendant has failed to comply therewith. There is an allegation (sixth) "that no proceedings at law or in equity have been taken by the plaintiff for the enforcement of the provisions of the said agreement (Exhibit B). " Judgment is prayed that the property mentioned in the agreement (consisting of Wish art's right, title and interest in the mining partnership existing between Thomas Costigan, John Godfrey and George Wishart in certain mining claims in the Porcupine district of Canada) be foreclosed and sold under the order and direction of the court, and the proceeds applied towards the payment of the obligations of Wishart to Stein secured and provided to be paid by the parties as aforesaid.
The amended answer of Wishart denies but one allegation of the complaint, viz., the " sixth" before quoted, and further sets up another action at law pending between the same parties upon the promissory note dated January 20, 1911, but which action is brought by Alexander Stein against George Wishart. The denial raises no issue. The presence of the allegation in the complaint was superfluous, for this action affects bnly personalty. In any event the allegation was non-issuable, and the denial thereof is not sufficient to require a trial of the issue. (Riesgo v. Glengariffe Realty Co., 116 App. Div. 414.) The other action pending, which is pleaded as a bar to this, .is not between the same parties; it is not upon the identical cause of action, nor does it seek nor can it afford the same relief.
The amended answer then proceeds to set up a separate and distinct defense by way of offset upon averments that Stein being a joint owner with Wishart, Costigan and Godfrey of the mine in question, a purchaser was obtained therefor who was willing, able and ready to pay $165,000 therefor, subsequently raising his offer to $200,000 in the event of a sale, at which price Wishart would have realized about $80,000 as his share, but that Stein refused to sell, saying the mine was worth at least $500,000, by reason of which the sale was lost, as it required the consent of all the owners to sell the mine, and that Stein "knew that his refusal would prevent such sale; " that the other owners were ready to sell, hut that the "willful" refusal of Stein to sell has damaged Wishart in the sum of $80,000. As there is no allegation that Stein had ever agreed, to make this sale, or induced the parties concerned to rely upon any representation of his to their detriment, we fail to see how his assertion of his legal right can furnish the basis of any claim against him. He was one of the owners of the mine; he could sell his interest or not as he saw fit; he could refuse to sell save at what he deemed a proper price. His motive in so doing was immaterial.There is no denial of any of the allegations of the complaint contained in this separate defense, and it is insufficient.
For a further and distinct defense the amended answer then (still without any denials of the allegations of the complaint) sets up that Wishart, Stein and one Whitney, being the owners of the stock of a Canadian corporation known as the Welch Mine, Limited, agreed to raise the balance of the purchase price. of the mine and the money required for its development, and that Stein offered to contribute $40,000 • thereto, provided Wishart and Whitney would deliver to him their respective notes for $20,000' each, secured by the stock owned by them. It is further alleged: "Twelfth. That defendant and said Whitney thereupon abandoned their intention to sell their stock and did each make his note to said Stein for Twenty thousand ($20,000) dollars and did deliver the same to said Stein upon the expressed condition that said Stein would hold said notes until the sale of the control of said company then in his possession and that said Stein would thereupon satisfy said notes with interest from the proportionate part of the proceeds of said sale, accounting to the defendants and Whitney for any surplus and would not seek to enforce.said notes in any other manner unless after such sale a deficiency should arise. That defendant and said Whitney at the time of said conditional delivery of said notes, delivered to said Stein all their stock in said corporation as collateral security for said notes." It is then set forth that Stein bought Whitney's stock from him by the return of his note but refused to buy Wishart's stock,, although requested, and that Stein has not sold the control of the corporation, ánd, therefore, "has not performed the condition by which alone he would be entitled to enforce the note herein." The allegations of the complaint, not being directly controverted by a general or specific denial, are not put in issue by a statement merely inconsistent with those facts or from which a denial may be implied or inferred. (.Rodgers V. Clement, 162 N. T. 422.) The note is set forth in full as an exhibit annexed to the complaint. It is complete upon its face. It is a note secured by collateral, and the agreement governing the realization thereupon is annexed as well. The note contains a definite date of payment. The defense attempted to be set up does not deny the existence of the indebtedness; does not deny that the note was given for value received, does not claim that it was void ab initio, does not assert that it was to become void in the happening of certain eventualities. It is simply an attempt to vary the terms of the note and the trust' agreement accompanying it by postponing the time of payment set forth in both instruments, which upon their face appear to constitute a complete agreement. This cannot be done. (Thomas v. Scutt, 127 N. Y. 133; McKeige v. Carroll, 120 App. Div. 521.) The cases cited by respondent do not apply, for there the defense was that the notes sued upon were never to become valid, enforcible obligations until certain contingencies occurred. No such issue is presented here.
Inasmuch as defendant has not attempted either in his original or amended answer to deny any of the averments of the complaint, and the defenses which he has sought to interpose are insufficient in law, there seems to be no necessity for giving the defendant leave to plead anew.
The order appealed from will, therefore, be reversed, with ten dollars costs and disbursements, and judgment directed in favor of plaintiff upon the pleadings, with ten dollars costs.
Ingraham, P. J., McLaughlin, Clarke and Scott, JJ., concurred.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.