Case Name: GEORGE T. NEWHALL, Appellant, v. WILLIAM H. APPLETON, et al., Respondents
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1889-06-28
Citations: 25 Jones & S. 154
Docket Number: 
Parties: GEORGE T. NEWHALL, Appellant, v. WILLIAM H. APPLETON, et al., Respondents.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 57
Pages: 154–165

Head Matter:
GEORGE T. NEWHALL, Appellant, v. WILLIAM H. APPLETON, et al., Respondents.
Costs, security for additional when, cannot be required.—Deposit, withdrawal of, effect.—Orderswhen deemed made under § 8276.—Filing an undertaking under an order for an additional security, effect of on power of court.
Where, under an order for security for costs made under § 3272 of the Code of Civil Procedure, the plaintiff makes a deposit in lieu of filing an undertaking, the court has no power to order additional security under § 3276. The facts that the defendant had, under an order of the court, withdrawn from the clerk the deposit, and afterwards under a permissive order replaced it, and that thereafter the plaintiff in an action brought by him against the defendant to recover the amount so withdrawn by him recovered judgment therefor, which judgment the defendants had satisfied, do not vest in the court any power to make an order under § 3276.
Where an order for security for costs has been made under § 3272, and has been complied with, all subsequent orders for security for costs made while it remains complied with are to be regarded as made under § 3276, unless it is therein otherwise expressly stated. The fact that a plaintiff who has complied with the first order for security for costs made under" § 3272, by making a deposit complies with subsequent orders (the first remaining complied with), requiring security for costs by filing an undertaking, does not empower the court to make another subsequent order requiring security for costs.
Before Sedgwick, Ch. J., and Freedman, J.
Decided June 28, 1889.
Appeal by plaintiff from an order requiring him to give an additional undertaking as security for costs.
Note.—It will be seen from the statement of the case, that the amounts, deposited by plaintiff under the first and second orders, were paid to the defendants by the clerk, pursuant to the order of the court. It is not perceived how this alone can affect the status obtained by plaintiff, by making the deposit under the first order ; the effect of the payment to defendants was simply that they held the deposit instead of the clerk; the undertaking given under the order of June 18,1886, while this was the situation of things, could only be regarded as given under an order for additional security, and, consequently the giving of it would not, under the decision, empower the court to make the order appealed from'. The question as to what would have been the effect if the order of June 18, 1886, had been made, and the undertaking given thereunder had been given, allowed and filed after and not before the recovery of the city court judgment and its payment, did not arise on the appeal. It may be that in such event the order for security would have been regarded as an original order under § 3272, as the effect of such judgment and payment was to wipe out the first order and the deposit thereunder and leave defendants without any security, and this was the result of plaintiff’s action. There was nothing, therefore, to add any security to, and consequently an order simply requiring security to be given, without expressly declaring it to be “further” or “additional,” might well be regarded as requiring original security under § 3272.—The order appealed from cannot be so regarded, for it expressly states that the undertaking required by it is to be given as additional security; it was, therefore, evidently made under § 3276, and on the assumption that some security already existed. It may further be suggested as to whether, after the city court judgment and its payment, defendants might not have either expressly moved under § 3272 for security for costs, on the ground that by the act of plaintiff there was no security then existing, and had their motion granted, or moved the court for an order to compel the plaintiff to comply with the first order by either giving an undertaking or making a deposit.
The obtaining by defendants of the moneys deposited by plaintiff, does not appear to affect any of the questions determined in the opinion, as above suggested.—Reporters.
The plaintiff in this action being a non-resident, an order was made on July 24, 1878, requiring him to file security for costs. In compliance with this order he deposits with the clerk of this court $250 in lieu of an undertaking. Issues were joined in the action which were first tried before a jury. The trial resulted in a verdict for plaintiff. A new trial was ordered by the general term, with costs to abide the event. The cause was then referred to a referee to hear and determine the issues. At this stage of the case defendants made a motion that plaintiff file additional security for costs, on which motion an order was made, dated January 26, 1881, requiring plaintiff either to pay into court $250 in addition to the sum already paid, or file an undertaking in that amount. Pursuant to this order plaintiff paid into court an additional sum of $250. Afterwards the referee reported in favor of defendants, and judgment was rendered therein against the plaintiff for $1,105.90, costs and disbursements. Thereafter, on defendants’ motion, plaintiff opposing, an order dated December, 1881, was made, directing the clerk of the court to pay over to defendants the said two sums of $250 each, to be applied on said judgment for costs, and also ordering the plaintiff to pay into court the further sum of $250 to be applied to the payment of costs, if any. awarded against him, or to file an undertaking in that amount. Under this order the clerk of the court paid over to the defendants the said two sums of $250, and plaintiff filed an undertaking, executed by one Kearney, for the payment to the defendants of all costs which might be awarded against plaintiff, not exceeding $250, which undertaking was approved on justification.
Thereafter plaintiff appealed from said judgment to the general term of this court, which affirmed the judgment below with costs, and judgment of affirmance with. $113 costs was entered against plaintiff June 5, 1883.
After the entry of this judgment Kearney paid the $113 to defendants, and plaintiff afterwards reimbursed him.
Thereafter plaintiff appealed to the court of appeals, and that court reversed the two judgments entered against the plaintiff, and ordered a new trial with costs to abide the event. The cause was then again referred to a referee to hear and determine, who reported in favor of the plaintiff, and judgment was entered June 24, 1886, on his report against defendants for $4,185.62 damages and costs. Defendants appealed to the general term of this court. At this stage, and on Aug. 2, 1886, defendants served a notice of motion, bearing date that day, for an order granting them leave to retain in their possession the said two sums of $250, and the said sum of $113, until the final termination of the action, or, in default thereof, that defendants be required to pay said sums to the clerk of the court, to be retained by him until the final termination of the action, as security for costs on the part of the plaintiff as a non-resident. On July 10, 1886, plaintiff filed an undertaking, executed by «one McCormick and one Johnson, for the payment of all costs which might be awarded to the defendants, not exceeding $500. The undertaking did not show that it was given pursuant to an order, nor did it have any allowance endorsed thereon. It is stated in an affidavit that it was given under an order entered June 18, 1886, directing security for $500. The precise terms of the order, however, do not appear.
On the 24th day of August, 1886, the plaintiff assigned to W. W. Badger the said $613, and all his .right, title and interest therein and thereto, and to any and to all claims and causes. of action arising therefrom against the defendants. On the 25th day of August, 1886, Badger commenced an action in the city court of New York against these defendants to recover said $613, and interest. Subsequent to said 25th of August, the motion, initiated by the notice of August 2, 1886, came on to be heard August 26, 1886, upon affidavits setting forth the above matters, and resulted—plaintiff being heard in opposition, in an order bearing date September 4, 1886, whereby it was ordered “ that the defendants are hereby granted leave to pay the said sum of $500 (being the aggregate of said two sums of $250,) and $113, to the clerk of this court, to be retained by him until the determination of this action as security for the costs on part of the plaintiff as a non-resident, and that, when so paid, the clerk of this court shall retain said sums accordingly.”
On the 25th of September, 1886, defendants, pursuant to the leave granted by the order of September 4, 1886, deposited with the clerk of this court said two sums of $500 and $113. On the 30th of September defendants answered the complaint in the city court action, and the issues joined thereby were tried before the court without a jury on the 8th day of October, 1886, when the above matters were all proved. The trial resulted in a decision in favor of Badger, the plaintiff, upon which decision judgment was, entered against the defendants for $779.19 with $121.05 costs, amounting together to $900.24.
The judge before whom the city court action was tried, delivered the following opinion (after reciting the facts):
“ The defendants’ counsel truly says that the main question in this case is one of title, and contends that the plaintiff’s assignor had no title to the moneys in question, and therefore could not assign anything to plaintiff. If this be true it is an end to plaintiff’s case. ,
“ It will be conceded that the plaintiff’s assignor originally owned the five hundred dollars, and having reimbursed the surety to the undertaking, he also owned the one hundred and thirteen dollars when the money was deposited in the Superior Court. Plaintiff’s assignor still owned the money, subject to his title being divested upon a recovery of judgment by defendant against him for costs, upon which the court could make an order divesting said plaintiff of his title, and ordering the money to be paid over to defendants. The defendants did recover a judgment, and the money so deposited was duly paid over to defendants ; and the title thereto became vested in them by virtue of an order of the court. This title was absolute so long as the judgment stood; but when the same was reversed and annulled by the court of appeals, the title to the moneys again became vested in plaintiff’s assignor, subject only to the payment of costs, in case defendants again recovered judgment; but the plaintiff’s assignor having succeeded on the new trial, no costs could be awarded against him, and his title to said money became absolute, and the same could not be held as security for costs, as there could be no costs, the plaintiff in that action having succeeded.
“ The Code provides that a non-resident plaintiff must give security for costs, if he seeks the benefit of beginning and carrying on a litigation in our courts. This is a very proper, and perhaps necessary, protection to parties compelled to defend actions brought by non- residents ; but when such non-resident plaintiff has succeeded, and a judgment including costs, has been awarded to him, and it has been determined that he is not liable for costs," there is certainly no reason for his giving security.
' “The judgment of the Superior Court being in favor of plaintiff’s assignor, it must be assumed that it is correct. It cannot for a moment be considered that it is going to be reversed on appeal; and, this being the case, the plaintiff’s assignor cannot be liable for any costs.
“ The Code requires a non-resident to give security for costs for litigating disputed claims, in orneo urts, but when the claim is ripened into a judgment in his favor, it does not require him to give security for the privilege of resisting an appeal from the judgment and endeavoring to sustain and confirm the action of the court. To take any other view would be tantamount to assuming that the judgment of the court was wrong.
“ It appears to me that a fair test in this case would be to suppose that no security had previously been given by plaintiff’s assignor, and defendants had only now discovered that he was a non-resident. Would the court order him to give security for costs after he had recovered a judgment ? Clearly not, and, therefore, there is no reason for keeping his money.
“ The defendants, when they succeeded in the Superior Court, had the right to assume, and did assume, that its judgment was right, and they obtained the money deposited as security, but if they had awaited the appeal to the court of appeals, and not taken the deposit, the title of plaintiff upon the reversal of the judgment would have been complete, and the fact of their having withdrawn the money cannot alter the title.
“ The defendants having seen fit to withdraw the money deposited, and to compel payment on the undertaking, without awaiting the decision of the court of appeals, and having had the use of it, I see no reason why they should not be charged with interest from the time they received it.
“ If the defendants succeed upon their appeal in the Superior Court action, they will then be in a position to require security for costs before the plaintiff can be allowed to try his case again or prosecute a further appeal.
“ The order of the Superior Court, granting defendants leave to deposit the money in that court, was made upon their application, which was resisted by the plaintiff, and was not mandatory upon them, and does not and could not relieve them from any liability already incurred ; and such order was not made until after the assignment of the claim to plaintiff and until after this action had been begun.
“ It follows that plaintiff is entitled to judgment for the sum of $613, with interest.”
An appeal was taken from the City Court judgment to the general term of the Common Pleas where it was affirmed (Badger v. Appleton et al., 6 N. Y. State Reporter, 288).
An appeal was taken to the court of appeals which was dismissed by that court. 110 N. Y. 652.
Subsequent to August 2, 1886, (the precise date does not appear), the above-mentioned appeal taken to the general term of this court by the defendants from the judgment entered against them was argued, and the general term affirmed the judgment. Thereupon defendants appealed to the court of appeals where the judgment was reversed and a new trial ordered about April 26, 1889.
On April 26, 1889, defendants procured an order requiring plaintiff to show cause why he should not be compelled to give security for costs herein. On the hearing of the motion initiated by this order to show cause, the above matters were made to appear. The judge before whom the motion was heard granted it, writing as follows :—

Opinion:
Tbtjax, J.
" Thisis a motion to compel the plaintiff, who is a non-resident, to give additional security for costs. Five hundred dollars were deposited by plaintiff as security for costs, but was afterwards 'obtained by him. He then gave an undertaking in the sum of $500 as security for costs. I am of the opinion that the fact that plaintiff has obtained the money that he deposited as security for costs, distinguishes this case from the case of Honduras v. Soto, 112 N. Y. 310. There is no longer any money on deposit as security for costs. The plaintiff has given an undertaking, but the papers show that this undertaking is insufficient. Section 3276 of the Code of Civil Procedure provides, that any time after the allowance of an undertaking, the court, upon satisfactory proof that the sum specified in the undertaking is insufficient, must make an order requiring the plaintiff to give an additional undertaking. Section 3273, provides, that the undertaking shall be in at least the sum of $250. This, by implication, authorizes the court to order security in a sum greater than $250, if the affidavits show that the costs will be more than that sum. Section 3276 provides for an additional undertaking, and does not provide for the deposit of a sum in lieu thereof. It was, in effect, stated by the court of appeals, in Honduras v. Soto, that the power of the court to order security for costs depends upon statute, ' and authority, therefore, must be found in the statute or it does not exist.' It therefore follows that where a person has given an undertaking he must, if the court sees fit, give an additional undertaking in the form prescribed by section 3273, which undertaking must be at least $250. The affidavits show that the costs will be at least $1,000, and for that reason I am of the opinion that the plaintiff should give another undertaking in the sum of • $500."
Upon this decision an order dated May 14, 1889, was made, whereby it was ordered. " That the plain tiff be and is hereby required within twenty days from the service of a copy of this order on his attorney, to furnish an undertaking in the sum of $500; with two sureties in the usual form, as additional securities for costs herein," etc.
From this order the present appeal is taken.
William, W. Badger, attorney and of counsel for appellant, argued.
I. It is wholly immaterial what became of the plaintiff's two deposits of $250 each, after defendants withdrew them from this court. If plaintiff had withdrawn them by order of this court, before the final end of the case, it might possibly be argued that such an act would be a revocation of his election to deposit them, but defendants having withdrawn them by order, the account is closed, and the object of the deposits was-fully accomplished, and the power of the court thereby exhausted by the first order, as ruled in Honduras v. Soto, 112 N. Y. 310. In re village of Middletown, 82 Ib. 196 ; People, ex rel. Brown, v. Woodruff, 32 Ib. 355.
II. It is no reason for making an illegal order that two other illegal orders have already been made and been complied with by plaintiff. So much the more should his objection now prevail. It goes to the jurisdiction and power of the court, and so can be taken at any time, and it certainly has not been waived as to this order appealed from. As the court plainly had no power to order that undertaking to be given, the order is without jurisdiction and void and the undertaking falls with it, or at most is only the plaintiff's voluntary act. Moreover, the voluntary giving of a prior undertaking does not bring the case within the letter or the spirit of § 3276. Being for $500, it does not even purport to be given under § 3272, nor as " additional security " under §-3276, which section only applies " after the allowance of an undertaking given pursuant to such an order." In fact, this undertaking was never " allowed " by the judge at all ; and if " deemed allowed " for want of exception, under § 3275, it "must be indorsed and filed in like manner," as if excepted to ; that is (as required by § 3275), that the judge "must indorse his allowance thereon and cause them to be filed with the clerk." The undertaking shows no " allowance " nor " order," and no power was, therefore, acquired under § 3276 to make this order appealed from.
Campbell & Paige, attorneys, and Edward Winslow Paige, of counsel, for respondents, argued :
The matter is exactly within the language of the Code. The plaintiff has filed two undertakings, one 12th January, 1882, and the other 10th July, 1886, which were allowed. Both of them have now become insufficient, and according to the Code, the court must make an order "requiring the plaintiff to give an additional undertaking." (Section 3276 quoted above.) In the Honduras case no undertaking had been filed, and that case has therefore no sort of application.
By the Coukt.—Sedgwick, Ch. J.
The only authority that the court has for ordering a plaintiff non-resident to give an additional undertaking, because a former undertaking is insufficient in amount, is found in section 3276, Code Civil Procedure.
That section, in effect, empowers the court to order an additional undertaking when it is proved " that the sum specified in the undertaking is insufficient." This condition must be strictly and literally observed. Honduras v. Soto, 112 N. Y. 310. Was there any such proof below. The undertaking referred to in the words that have been cited, is indi catedby the first part of the section, in these words: " At any time after the allowance of an undertaking given pursuant to such an order, etc." And such order is the order that may be made under section 3272, Code Civil Procedure. In fact, such an order was made in this action, but under it no undertaking was given and allowed. In lieu thereof, as the order provided, the plaintiff paid into court $250. to be applied to the costs if awarded. As no undertaking was allowed under section 3272, the court had no power to order an additional undertaking.
It is true that after the first order and before the application below, other undertakings had been ordered. These, however, were orders made under section 3276 and not under section 3272. Under the latter, as we have said, no undertaking was allowed, and such an allowance is the condition of issuing an order under section 3276. These intermediate orders do not create an estoppel as an adjudication.
Order appealed from reversed with costs, and motion denied with $10 costs.
Freedman, J., concurred.