Case Name: UNION NAT. BANK OF LEWISBURG, PA., v. LEARY
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1904-06-10
Citations: 88 N.Y.S. 652
Docket Number: 
Parties: UNION NAT. BANK OF LEWISBURG, PA., v. LEARY.
Judges: 
Reporter: West's New York Supplement
Volume: 88
Pages: 652–657

Head Matter:
UNION NAT. BANK OF LEWISBURG, PA., v. LEARY.
(Supreme Court, Appellate Division, First Department.
June 10, 1904.)
1. Subsequent Appeals—Former Decision—Law op the Case.
The unreversed decision of the Appellate Division, that an agreement to forbear enforcing notes was supported by a sufficient consideration, is the law of the case on a subsequent appeal on the same evidence, together with proof that a receiver for the maker of the notes had been appointed prior to the agreement, and that an injunction which restrained all persons within the state from proceeding to collect claims against the maker was then in force, as such injunction could not operate against plaintiff, a national bank doing business in a foreign state.
Ingraham, J., dissenting.
Appeal from Trial Term-, New York County.
Action by the- Union National Bank of Lewisburg, Pa., against Mary C. Leary, as administratrix, substituted, etc., for defendant James D. Leary, deceased. Prom a judgment for plaintiff, defendant appeals. Affirmed.
See 79 N. Y. Supp. 217.
Argued before VAN BRUNT, P. J., and HATCH, O’BRIEN, INGRAHAM, and LAUGHLIN, JJ.
Alfred A. Cook, for appellant.
Clifford W. Hartridge, for respondent.

Opinion:
HATCH, J.
When this case was before us upon the former appeal (7 App. Div. 332, 79 N. Y. Supp. 217) we held that under the statute of frauds a consideration supporting the contract of guaranty was required to be expressed in the instrument, or be fairly inferable therefrom ; that, in arriving at a correct construction of the contract, all of the facts and circumstances attendant upon its delivery, the reasons therefor, and the purpose sought to be accomplished could be shown. And, applying such rule to the facts as they then appeared, we reached the conclusion that the instrument of guaranty fairly gave rise to the inference that the consideration for its execution was the agreement to forbear the enforcement of the notes, the subject of the guaranty, for a reasonable time, and that such agreement furnished a good consideration for the instrument sued upon. Upon this ground we reversed the judgment and ordered a new trial. The case as presented upon the new trial which has been had does not differ in any substantial respect from the case as made upon- the formei appeal. While the facts and circumstances have been developed with more elaboration, yet in all essential features the case remains the same. The additional testimony given by the defendant does not add in the slightest degree to the force and effect of the averments contained in the answer of the defendant, and which we considered as having been established upon the former appeal. The additional testimony is a mere reiteration of these facts, and, as they were held insufficient to relieve from liability under the guaranty upon the former appeal (79 N. Y. Supp. 217), so, likewise, they must now be held ineffectual for such purpose.
Only one additional consideration is involved in the disposition of this appeal. It now appears that upon the 15th day of July, 1897, a receiver of the John Good Cordage & Machine Company was appointed, and in the order appointing such receiver was contained an injunction clause restraining all persons within the state of New York from making claims against it, or from, commencing, continuing, of carrying on any suits or proceedings, or issuing any execution, process, or proceeding, upon any judgment or order now obtained, or that may hereafter be obtained, against the corporation, or from levying upon, seizing, selling, advertising, or taking any steps to- levy upon, seize, sell, or advertise any of its property. The contract of guaranty bore date October 16, 1897, so that the injunction was in full force and operation within the state of New York at the time when the contract of guaranty was executed. The plaintiff, however, is a corporation, organized and existing, by virtue of the Laws of the United States, as a national banking corporation, and doing business as such in the city of Lewisburg, in the state of Pennsylvania. Manifestly, the injunction order did not operate to restrain the plaintiff from instituting proceedings and prosecuting actions to judgment against the corporation, or from levying upon, seizing, and selling any of the property of the corporation which it might reach outside of the limits of the state of New York. It does not appear,.so far as I am able to discover in this record, whether the John Good Cordage & Machine Company was a foreign or domestic corporation. It does appear, however, that a proceeding was instituted for the appointment of a receiver in the state of New Jersey. It is fairly to be inferred therefrom either that the corporation was organized under the laws of that state, or that it had property within its jurisdiction which it was sought to embrace within a receivership; but, however this may be, there is nothing whatever ,tO' show but that the plaintiff could have instituted an action and enforced any judgment which it might have obtained within the jurisdiction where it carried on its business, and therein the injunction granted in this state could not and did not operate. It seems, therefore, to stand admitted now, as upon the former appeal, that the contract of guaranty was delivered for the purpose of procuring an extension and forbearance in the enforcement .of the notes for a reasonable time, in consequence of which the decision delivered upon the former appeal is of controlling force and decisive of all the questions now presented. Until this decision shall be reversed by superior authority, it must be regarded as controlling in dis- position of the questions presented by this appeal.
It follows, therefore, that the direction of a verdict by the learned court below was correct, and the judgment based thereon should be affirmed, with costs.
O'BRIEN and LAUGHLIN, JJ., concur. VAN BRUNT, P. J., concurs in result.