Case Name: James B. Swing, as Trustee for the Creditors of the Union Mutual Fire Insurance Company of Cincinnati (Formerly a Corporation), Respondent, v. Albeet A. Engle, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1911-02-01
Citations: 143 A.D. 181
Docket Number: 
Parties: James B. Swing, as Trustee for the Creditors of the Union Mutual Fire Insurance Company of Cincinnati (Formerly a Corporation), Respondent, v. Albert A. Engle, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 143
Pages: 181–191

Head Matter:
James B. Swing, as Trustee for the Creditors of the Union Mutual Fire Insurance Company of Cincinnati (Formerly a Corporation), Respondent, v. Albert A. Engle, Appellant.
Fourth Department,
February 1, 1911.
Judgment — decree of foreign court — how far conclusive — pleading — answer — lack of knowledge or information sufficient to form belief — remedy where pleading irregular — Statute of Limitations — amendment of answer.
The decree of a court of a sister State dissolving a corporation organized under the foreign law, appointing a trustee for creditors and stockholders and directing him to collect assessments made against policyholders, is conclusive here as to the necessity and amount of the assessment. But it is not conclusive as to the personal liability of a policyholder for an assessment, where he was not a party to the proceeding in the foreign court.
An answer which after making certain admissions and averments, states “ that as to the other material allegations in said complaint he [the defendant] has not any knowledge or information thereof sufficient to form a belief/’ is defective in that it leaves the question open as to what allegations the pleader regards as material. But where the plaintiff makes no motion to compel the defendant to make such allegations more definite and certain, the denial should not be disregarded although not in proper form. In any event the defendant should be allowed an amendment to remedy the defect.
Although a defendant intending to assert the Statute of Limitations, instead of alleging that the cause of action had not accrued within six years prior to its commencement, states that the defendant did not undertake or promise to pay the claim within' that time, so that the statute is insufficiently pleaded, the defendant’s motion to amend his answer should be granted where the plaintiff has not been misled.
Appeal by the defendant, Albert A. Engle, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Erie on the 24th day of March, 1910, upon the verdict of a jury rendered by direction of the court.
Parton Swift, for the appellant.
Martin Clark and Patterson A. Reece, for the respondent.

Opinion:
Kruse, J.:
The action is brought to recover upon the defendant's liability as a policyholder in a mutual fire insurance company organized under the laws of the State of Ohio. The Supreme Court of that State dissolved the corporation, appointed the plaintiff a trustee for the creditors and stockholders, and directed him to collect the assessments made against the policyholders. While the judgment of the Ohio court is conclusive as to the necessity and amount of the assessment, it is not as to the defendant's liability since he was not a party to the proceedings in the Ohio court. (Swing v. Mooney, 139 App. Div. 821.)
The defendant challenges his liability and contends that if there ever was any, it is barred by the Statute of Limitations. He attempted to put in issue the material allegations of the complaint as well as to plead the Statute of Limitations. Strictly he did neither. The first answer, after making certain admissions and averments, concludes with statement: " Avers that as to the other material allega tions in said complaint, he has not any knowledge or information thereof sufficient to form a belief." Such a denial is not good pleading. It necessarily leaves the question open as to what allegations the pleader regards material. But while the defendant could have been required to make his answer more definite and certain upon a motion made for that purpose before trial, I think the denials, although not strictly' in proper form, should not have been disregarded and the defendant's evidence excluded. (Thompson v. Wittkop, 184 N. Y. 117.)
Furthermore, the plaintiff did not stand upon the insufficiency of the denials in the answer, but proceeded to prove his case; and in any event, if necessary, the defendant should have been permitted to amend his answer.
The defendant sought to show that the Ohio statute, upon which the plaintiff bases his claim, does not apply to the defunct corporation and that- no liability exists against him under the statute as it was when the insurance company was organized. The plaintiff was beaten upon that ground in a similar action brought in the State of Minnesota (Swing v. Red River Lumber Co., 105 Minn. 336); but whether the defendant should ultimately succeed upon that ground in this action need not now be determined as he was not permitted to make his proof upon that question. The original statute under which the corporation was organized seems to have been amended and provision made for corporations organized under the original statute to reorganize under the amended statute. Whether the corporation was so reorganized does not appear. Under the original statute the policyholder's personal liability depended upon his making premium notes which were held to meet his contingent liability. Under the amended statute no such notes were required to make the policyholders liable. It does not appear that the defendant made such a note. If he did not and the company was not reorganized there would seem to be no liability; but, as has been said, that question need not now be decided until all the proof has been made.
As regards the Statute of Limitations : The defendant instead of alleging that the cause of action had not accrued within six years prior to the commencement of the action, alleged that the defendant did not undertake or promise to pay the claim within that time. 1 think this defense was insufficiently pleaded, but the plaintiff was not misled thereby and the motion to amend the answer should have been granted.
There are other questions raised, but it is not necessary to consider them, as the views expressed necessarily result in a new trial.
It may, however, be proper to suggest that the transcript of the proceedings of the Ohio court is not as complete and full as it should be. Among other things, the complaint or petition upon which the suit or proceeding is founded is not included, and it is not entirely clear whether the judgment was rendered in 1891 or in 1901. The plaintiff was defeated in a similar action in the State of Arkansas and the deficiencies in the transcript by which the Ohio judgment was sought to be established pointed out by the Supreme Court of Arkansas. (Swing v. St. Louis Refrigerator & Wooden Gutter Co., 78 Ark. 246.) The evidence upon thac question should not be left doubtful and uncertain.
The record is also silent as to whether there was any by-law of the corporation concerning the publication of notice of assessments, as is provided by the original act as well as the amendatory act; or whether any other notice than that mailed to the defendant was given. That fact may have an important bearing upon the question of the Statute of Limitations.
The judgment and order should be reversed and a new trial granted.
Speing and Robson, JJ., concurred; concurring opinion for reversal by McLennan, P. J., in which Williams, J.,* concurred.