Court Opinion

ID: 5337382
Source: CourtListenerOpinion
Date Created: 2022-01-08 05:40:51.165929+00
Date Added: 2024-06-11T08:29:31.014975
License: Public Domain

Untermyer, J.
(dissenting). I dissent upon the ground that, without reference to other questions, the action of the coplaintiffs against the defendant is barred by the six-year Statute of Limitations applicable to actions for breach of contract (Civ. Prac. Act, § 48).
The contracts, for breach of which the coplaintiffs, as curators in bankruptcy of Laurent Van der Stegen, have recovered, were made between the Belgian Trading Company and the defendant Neuss, Hesslein & Co., Inc. The breach occurred on May 27, 1920. On June 20, 1920, the Belgian Trading Company, plaintiff’s assignor, instituted an action for the breach of these contracts in the United States Court for China, which- after trial resulted in a judgment against the defendant. While that action was pending Van der Stegen on September 4, 1923, was adjudicated a bankrupt by the Belgian Consular Tribunal at Shanghai, in consequence of which the present curators of his property were appointed by that court on April 23, 1924. The curators, however, were never substituted as plaintiffs in that action, which continued by amended petition in the name of L. Van der Stegen, doing business under the firm name and style of the Belgian Trading Company. From the judgment entered in the United States Court for China, the defendant appealed to the United States Circuit Court of Appeals for the Ninth Circuit, which, on February 8, 1926, reversed the judgment and dismissed the petition for want of jurisdiction over the defendant (10 F. [2d] 772). Upon its mandate, dated June 9, 1926, an order was entered in the United States Court for China dismissing the action.
After the Circuit Court of Appeals had reversed the judgment this action was commenced by the service of a summons on the defendant on February 16, 1926, in the name of Laurent Van der Stegen, doing business under the firm name and style of the Belgian Trading Company. The complaint was served on April 1, 1926. *134Issue was joined on June 21, 1926. Thereafter Van der Stegen’s attorneys, having learned of the intervening bankruptcy and the appointment of curators of Van der Stegen’s property, on September 10, 1926, made a motion on his behalf to substitute the curators as parties plaintiff. The motion was denied on June 20, 1928, but on appeal, this court, on June 15, 1929, reversed the order to the extent of allowing the curators to be added as coplaintiffs without prejudice to any proceedings theretofore had (226 App. Div. 872). Not until September 16, 1932, did the curators avail themselves of the right accorded to them by serving a supplemental summons and complaint in the action. Not until then was their action begun. (Civ. Prac. Act, §§ 16 and 218.) It is important to observe, however, that the order of this court did not substitute the curators in the place of Van der Stegen. It merely permitted them to be joined as coplaintiffs and thereby reserved to the defendant all the defenses available to it. Indeed, it is very clear that the court could not have prejudiced the defendant’s right to avail itself of the statute by allowing new parties to be joined. (Harriss v. Tams, 258 N. Y. 229; Shaw v. Cock, 78 id. 194; Gray v. Vought & Co., 216 App. Div. 230.) When the coplaintiffs served their supplemental summons in the action pursuant to leave obtained, it constituted the commencement of the action as to them. The effect was the same as if, on September 16, 1932, they had begun an independent suit, which of course they could have done at any time without seeking the permission of the court.
The trial court has held that by the bankruptcy, Van der Stegen, by operation of law, had been divested of any cause of action which he may have had against the defendant. We are unanimously of the opinion that this conclusion is correct. It seems to me that if this be so, then the cause of action asserted by the curators as coplaintiffs, more than twelve years after it accrued, is barred by the Statute of Limitations.
.The objection is attempted to be met by the argument that this action was begun by Van der Stegen on February 16, 1926, within the six-year period, and that the curators in some way are' entitled to the benefit of this. I do not know upon what theory a party who is vested with a cause of action can abstain during the period of limitation from attempting to enforce it and then secure the benefit of an action to which he was not a party, instituted by a plaintiff without cause of action of any kind. When the cause of action accrued on May 27, 1920, the Statute of Limitations commenced to run. It continued to run against every one, except against a party who within the statutory period had *135instituted suit. Concededly, when this action was commenced by Van der Stegen it could not be maintained by him. Manifestly also, a new action could not have been maintained by the curators when on September 16, 1932, they were introduced into the pending action by the service of their supplemental summons and complaint. I am at a loss to understand upon what theory two such actions, both of which would necessarily have been unavailing, may be so consolidated as to be effectual.
Section 82 of the Civil Practice Act is not applicable here. It might indeed have been applicable in the situation which existed in the Federal suit, where the bankruptcy intervened after the action was commenced. (Melnick v. Commercial Casualty Ins. Co., 221 App. Div. 599, 601.) Here bankruptcy did not intervene after the commencement of the action. Two years before it had divested Van der Stegen of any cause of action against the defendant by transfer to the curators of all right and title therein. (Foster v. Central National Bank, 183 N. Y. 379, 384.) The curators made no attempt to assert their claim within the time limited by law. After their appointment on April 23, 1924, they could have caused themselves to be substituted as plaintiffs in the Federal action and thereby secured the benefit of section 23 of the Civil Practice Act when that action was dismissed for lack of jurisdiction. After the decision of the Circuit Court of Appeals on February 8, 1926, they could immediately have commenced an action here and avoided any question of the Statute of Limitations. We may even assume, notwithstanding the decision in Streeter v. Graham & Norton Co. (263 N. Y. 39), that without substitution in the Federal suit they might, under section 23 of the Civil Practice Act, have maintained an independent action here within one year after the dismissal of the Federal suit on the theory that, after Van der Stegen’s bankruptcy, it was continued for their benefit. Yet they did none of these. They allowed the action to be prosecuted by a party against whom the defendant had the right to believe it had a complete defense and then at the expiration of twelve and one-half years they attempted to confront the defendant with new plaintiffs who, until then, had not undertaken to assert their claim by any judicial proceeding. This in my opinion they might not do. (Matter of Schlesinger, 36 App. Div. 77.) However desirable such a result may seem, I do not consider that the court should reheve these coplaintiffs from the operation of the statute upon any theory that Van der Stegen commenced the action here as a trustee for the curators, when in point of fact there was no trust of any kind, as the court below, in dismissing the complaint as to him, correctly held.
*136The decisions referred to by Mr. Justice Mebbell as sustaining the opinion to the contrary do not seem to me applicable here. N. Y. C. & H. R. R. R. Co. v. Kinney (260 U. S. 340) and Rudkowsky v. Equitable Life Assurance Society (145 Misc. 765; affd., 238 App. Div. 704) did not involve any substitution or change in the parties to the action. The only question in each of those cases was whether the complaint had been changed to assert a new cause of action by an amendment made after the expiration of the period of hmitation. It was held that, unlike Harriss v. Tams (supra), the change did not, under the particular circumstances, involve the substitution of one cause of action for another but constituted merely an amplification of the cause of action originally asserted in the complaint. Missouri, Kansas & Texas Railway v. Wulf (226 U. S. 570); Murray v. N. Y., Ontario & Western R. R. Co. (242 App. Div. 374), and Hulbert Brothers & Co. v. Hohman (22 Misc. 248) are all instances of an amendment which only changed the capacity in which the same plaintiff maintained the action without introducing any new party or any different state of facts. We have a very different situation when an action, which could not have been prosecuted by the plaintiff originally instituting it, can be successfully maintained by the addition of new parties plaintiff against whom the Statute of Limitations has run. That distinction was fully recognized and applied in Johnson v. Phœnix Bridge Co. (197 N. Y. 316).
For these reasons the judgment, in so far as appealed from by the defendant, should be reversed and the complaint of the coplaintiffs dismissed.
Judgment so far as appealed from affirmed, without costs.