Court Opinion

ID: 5469384
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:23:27.688895+00
Date Added: 2024-06-11T08:33:14.726778
License: Public Domain

Welles, Justice.
This case, I think, belongs to the class in reference to which provision is made by § 317 of the Code of Procedure. (Briggs agt. Vandenburgh, 22 N. Y. R., 467.) The plaintiff is, by operation of law, the trustee of an express trust. (2 R. S., 469, § 67 ; Laws of 1852, ch 71, p. 67, § 1.) He is also expressly authorized by statute to sue. (2 R. S., 469, § 68 ; id., 41, § 7, sub. 1.) The court is authorized to require the plaintiff to give security for costs, in the cases mentioned in the section of the Code referred to. The question is, whether this is a case calling for such exercise of discretion. In Darby agt. Condit, (1 Duer, 599,) Oakley, Ch. J., in discussing this same provision of the section of the Code, says : “ We are not prepared to say in what cases the broad discretion, which *284has been given to us by the section under consideration, will be exercised ; but we are satisfied that cases in which it can be properly exercised, will rarely occur.”
There is nothing 'in this case tending to show that the action was wantonly or causelessly commenced or prosecuted. For aught that appears in the moving affidavit, the defendant is legally indebted for the amount claimed in the complaint. The general denial in the answer, although sworn to by the defendant, at most only off-sets against the allegations of the complaint, which is also sworn to by the plaintiff; and the question must be determined upon the affidavit upon which the motion is founded, without any reference to the pleadings, except for the purpose of seeing what are the issues in the action.
In regard to the concluding portion of the section, and upon which the motion is founded, I incline to the opinion that the cases in which the discretion in question should be exercised, are those mentioned in a previous part of the section, in which the court is authorized to direct the costs to be paid by the plaintiff or defendant personally, for mismanagement or bad faith in such action or defence, and that, whenever the plaintiff is shown to be guilty of mismanagement or bad faith, such as would justify the court in charging the costs of the defence upon him personally, it would be the duty of the court, on motion pending the action, to require the plaintiff to give the security contemplated in the last clause of the section.
To recur to the facts alleged in the affidavit, which are claimed to be sufficient grounds to require the plaintiff to give the security in question. They are,- first, that judgments for costs to the amount of thousands of dollars have been recovered against the receiver of the company, by defendants in other actions brought by the receiver against them on premium notes, which the receiver refuses to pay, alleging he has no funds in his hands for that purpose. This fact, it seems to me, is not entitled to any considera*285tion in favor of this defendant on the present motion. If the fact he so, it is a reason why the defendant should be required to pay the demand for which he is prosecuted, provided he is. legally liable to pay it, which cannot be tried on this; motion. The second fact alleged is, that the receiver has now at issue over one hundred actions pending in this court, brought by him on premium notes, &c. It is not shown that these actions were improperly brought or prosecuted, nor but that the several defendants, including the defendant in this case, ought to pay the several notes upon which they are prosecuted.
The allegation in the affidavit, that some person or persons urged the commencement and prosecution of the actions before mentioned, in a manner to avoid liability for costs, &c., is equally wanting in significance upon the merits of this question.
That the receiver disclaims personal liability for costs in case the defendants in said actions shall succeed in their defences, is merely the assertion of a legal truism, unless he be convicted of mismanagement or bad faith. His disclaimer could not alter the result in any event.
If the attorney for the plaintiff has received the sum alleged in the affidavit, on premium notes, and refuses to pay them over for the reason imputed to him, it is not shown nor alleged that he retains the money wrongfully. If he has no right to retain it, the law provides ways for calling him to account, and there is no intimation of his inability to pay anything he may be legally required to pay. But over and above all this, it is a question that the defendant is not shown to have any vested interest in—any supposable interest he may have is contingent, depending upon his ultimate success in the action, and upon the final deficiency of the fund or assets of which the receiver is the trustee. In no possible aspect do any of these considerations affect the questions of good or bad management, or good or bad faith on the part of the plaintiff in the action.
*286The bad faith and mismanagement mentioned in the section, are to be understood as relating to the commencement of the action and the proceedings therein, and not to the conduct of the receiver generally in the management of the trust. And this is a conclusive answer to all the remaining allegations in the affidavit. I am therefore of the opinion, that the motion should be denied, with $7 costs.