Case Name: Judith Schackman, Appellant, v. A. Arthur Tracy, Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1962-04-24
Citations: 16 A.D.2d 640
Docket Number: 
Parties: Judith Schackman, Appellant, v. A. Arthur Tracy, Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 16
Pages: 640–643

Head Matter:
(April 24, 1962)
Judith Schackman, Appellant, v. A. Arthur Tracy, Respondent.

Opinion:
Appeal from a judgment of the Supreme Court in favor of defendant, entered March 9, 1959, in New York County, upon a decision of the court at a Special and Trial Term without a jury.
Per Curiam.
In this non jury action for a balance claimed to be due on a promissory note, the court dismissed the complaint at the conclusion of the entire testimony. We believe that this represented a proper adjudication on the contested facts. It appeared that plaintiff's husband had had some connection with a corporation known as Nassau Management. He had terminated all official relations with the corporation because of claims that it involved a conflict of interest. Defendant was an officer of and had a large investment in Nassau Management. Prior to the note in question and prior to the time that the city authorities had directed plaintiff's husband to sever his connection with Nassau Management, plaintiff and her husband had made several loans to Nassau Management on terms very favorable to plaintiff.
Application for the loan was made to plaintiff by officers of Nassau Management. As far as plaintiff was concerned, it was presented to her as an accomplished transaction. Withdrawal slips on her bank account were presented to her for signature. Shortly thereafter checks of her bank were presented which, on instruction, she indorsed to the order of defendant. These checks were deposited in defendant's bank account without his knowledge. The court could have found that all of these steps were taken by officers of Nassau Management (other than defendant) acting in concert with plaintiff's husband.
Some days later the same officers presented a note to defendant for $25,000. This money had already been placed in defendant's bank account and cheeked out by him to Nassau Management. He at first refused to sign but did so when it was explained to him that the loan was to Nassau Management, that it involved no liability on his part, and that the sole reason for his appearance in the transaction was to conceal the fact that plaintiff and her husband were doing business with the corporation. He did note in his checkbook that the $25,000 deposit was a loan, and he did sign a formal letter addressed to plaintiff thanking her for advancing the money.
Thereafter $15,000 of the $25,000 was repaid. The money came from Nassau Management's account and was drawn and delivered to plaintiff's husband by the same officers. Neither plaintiff nor defendant appears even to have been consulted as to the repayment.
Both of the Nassau Management officers refused to testify, pleading their privilege under the Fifth Amendment. Plaintiff's husband did not take the stand.
Defendant's version of the transaction, if believed, shows that he received no consideration and was not deemed by either the lender or the borrower to be a real party in interest. The circumstances surrounding the transaction lend support to this version.
The judgment should be affirmed, with costs.