Case Name: Charles A. Bird, in his Own Behalf and on Behalf of all Others Similarly Situated, etc., Respondent, v. Earl M. Lanphear, Appellant, Impleaded with Others
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1896
Citations: 11 A.D. 613
Docket Number: 
Parties: Charles A. Bird, in his Own Behalf and on Behalf of all Others Similarly Situated, etc., Respondent, v. Earl M. Lanphear, Appellant, Impleaded with Others.
Judges: 
Reporter: Appellate Division Reports
Volume: 11
Pages: 613–617

Head Matter:
Charles A. Bird, in his Own Behalf and on Behalf of all Others Similarly Situated, etc., Respondent, v. Earl M. Lanphear, Appellant, Impleaded with Others.
Equity—action for an accounting for moneys of which a number of parties were defrauded in the purchase of real estate — a complaint against individuals is sufficient to charge them as trustees.
A complaint in an action which alleges that the defendants have, by fraudulent acts, obtained possession of the moneys of the plaintiff and of others, and have induced them to enter into contracts for the purchase of certain parcels of real estate, and which demands an accounting of such moneys thus fraudulently obtained, states a cause of action cognizable in equity.
In such an action, the fact, that it does not appear that the plaintiff has any ground for relief as to one of the parcels of real estate, does not require the conclusion that the complaint does not state facts “ sufficient to constitute a cause of action.”
The fact that certain of the defendants, who had by a mortgage been constituted trustees, were not made parties defendant in their capacity as trustees, but merely as individuals, does not constitute a ground of demurrer to such a complaint where the allegations contained therein are sufficiently broad to indicate that the liability exists by reason of their fraudulent practices, and also to sustain the complaint, not only for money had and received by means of the fraud, but to render them liable to account as trustees under the mortgage.
Follett and Greek, JJ., dissented.
Appeal by the defendant, Earl M. Lanphear, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Steuben on the 17th clay of February, 1896, upon the decision of the court rendered after a trial at the Erie Special Term overruling the said defendant’s demurrer to the complaint, and also from an order entered in said clerk’s office on the 17th day of February, 1896, upon which said judgment was entered.
The facts are fully stated in the dissenting opinion of Follett, J.
Shire & Jellinek, for the appellant.
Frederick Collin, for the respondent.

Opinion:
Hardin, P. J:
Plaintiff's complaint contains extensive and elaborate allegations of fraudulent acts and schemes and devices of the defendants, whereby they have obtained possession of moneys of the plaintiff and others, and induced the plaintiff and others to enter into contracts for the purchase of three parcels of real estate in Tonawanda, Erie county. Plaintiff seeks to have an accounting of the moneys which he alleges the defendants have obtained by means of false and fraudulent representations practiced upon him and his associates. The plaintiff evokes the equitable jurisdiction of the court. (See A. S. R. Co. v. Fancher, 145 N. Y. 552.)
There is no allegation in the complaint that the plaintiff was one of the purchasers of block 7, nor that he advanced any moneys towards the purchase thereof. It is averred in the complaint that the following persons entered into an agreement for the purchase of block 7, to wit: Horatio Gilbert, W. E. Tuttle, Addie B. Furman, Thomas D. Welch, Everett S. Copeland, Hilton J. Baker, John R. Rose, Arthur C. Tadder, Alexander Lieb, William B. Hernán, F. Y. Combs, Phillip N. Hast, Jr., and others. It will be observed that in this allegation there is no allegation that the plaintiff was one of the purchasers. Nor is there any definite and specific allegation that he has any interest in block 7.
While it is difficult to see that the plaintiff has any ground of relief predicated upon the allegations relating to block 7, it is equally difficult to reach the conclusion that the complaint does not state facts " sufficient to constitute a cause of action."
The plaintiff seeks to have an accounting, and alleges the representations and their effect upon him, and that by means of the representations he was fraudulently induced to part with his money; and that by means of the false and fraudulent schemes concocted and practiced by the defendants that he is entitled to relief.
(2) It is made a ground of demurrer that the defendants Erwin H. Lanphear, Arthur G. Tadder and Earl H. Lanpliear were not joined as defendants as trustees. The allegation seemed to be sufficiently broad to indicate that their liability exists by reason of their fraudulent practices, and seemed to be sufficient to sustain the complaint against them in that aspect, not only for moneys had and obtained by means of the fraud, but to render them liable to account as trustees under the mortgage for anything they have received.
The case of Calkins v. Smith (48 N. Y. 614) furnishes little aid in the determination of the question in hand, as that was an fiction at law.
The complaint in this case was apparently upheld hy the General Term in the fifth department in the case reported in 92 Hun, 567; 36 N. Y. Supp. 1069.
If we follow the tenor of the opinion in that case we may uphold the complaint in the case in hand and affirm the judgment at Special Term.
Adams and Ward, JJ., concurred; Eollett and Green, JJ., dissented.