Court Opinion

ID: 5462221
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:40:01.133141+00
Date Added: 2024-06-11T08:32:56.318981
License: Public Domain

By the Court, James, J.
As this cause was tried before a referee, this court on appeal from the judgment may review the findings of fact as well as the conclusions of law. The action is prosecuted for the purpose of compelling a reassignment by the defendant to the plaintiff of the interest which the plaintiff as a member of the firm of S. A. Parks & Co., had on the 17th day of June, 1863, in 198 shares of the Pioneer Paper Company, and that day assigned to the defendant, on the ground that, it was a trust in the hands of the defendant for a specific purpose, which purpose has been accomplished, or if not, which trust has been revoked.
The defendant denies the trust, and avers that the assignment was absolute and unconditional, for a valuable consideration.
The instrument of transfer set forth by the plaintiff and admitted by the defendant, expresses a consideration, and is in terms absolute and unconditional, vesting in the defendant a complete and perfect title to the interest of Parks, as a member of Parks & Co., to the 198 shares of the paper company stock. To overcome this absolute conveyance, the defendant offered in evidence a written memorandum, of the same date as the assignment, signed by the parties, and one Wilson as a surety for the defendant, without stamp or seal, claiming that the two instru*33ments should be construed together as one instrument; in which case the latter would operate as a defeasance.
The reception of this written memorandum in evidence and its consideration in the case was strongly resisted, upon several grounds: 1st. Because it was not stamped. 2d. Because not under seal.- 3d. Because uncertain and ambiguous. 4th. Because made subsequent to the agreement ; and 5th. Because made in connection with a third party.
I hold that the two instruments must be regarded as delivered at one and the same time, for the same purpose, and should be held-as different parts of the same instrument and construed. together. They relate to the same transaction ; the latter reciting, the former defining and declaring its object and purpose; they bear the same date ; were executed and delivered at the same interview, the latter in response to a demand of one party for a memorandum of this transaction.
The objections to the admissibility of the memorandum in evidence, or its effect if admitted, are' not well taken, and serve no purpose unless it be to give color" to the allegation of fraud in the complaint. If the memorandum was a part of the assignment, and the two, one instrument, a seal to each was not necessary ; one seal would answer for both. But if a separate instrument, and executed even after the assignment, it would operate as a defeas-. anee in equity, "and since the Code, at law, though not under seal. (Slee v. Manhattan Company, 1 Paige, 48. Despard v. Walbridge, 15 N. Y. 374-378.) As one instrument, it was sufficiently stamped; as a separate instrument, a stamp was properly affixed and canceled on the trial. (Int. Rev. Act 1864, § 163.)
Zeither was the memorandum inoperative as a defeasance because executed with a third party; because it contained two parts, one defining the object and purpose of . the assignment, the other covenanting to indemnify against *34costs, and Wilson was only a surety' for the performance of the covenant of indemnity.
It must be conceded that the memorandum is indefinite and uncertain in some particulars; but the intent that it should operate as a defeasance of the absolute terms of the assignment is too clearly expressed to admit of any doubt.
Construing the two instruments together, it shows the condition, purpose and intent of the parties and the effect of the transaction to be this: Parks and Buchanan were copartners under the firm name of S. A. Parks & Co. Such firm held, subject to liens, the title to 198 shares of the stock of a corporation known as the Pioneer Paper Company, in which Comstock and Wilson were also stockholders ; some difficulty had arisen between Parks and Buchanan,-whereby Parks desired-a dissolution and. an adjustment of the firm matters; he had a consultation with Comstock, and tq accomplish such desire assigned to Comstock his interest in the stock of said company, with an agreement that Comstock should take legal measures to effeet a settlement of the said partnership and ascertain the value of Parks’ interest in said stock. As a formal consideration for such assignment, and to continue Parks as stockholder and director of said company, Comstock transferred to Parks ten. shares, of other stock owned by him, with the agreement that pending the settlement with Buchanan, each should draw the dividends of said stock as though no assignment had been made ; and then providing for the disposition of the stock, its amount being ascertained, as follows: If it exceeded $1000 over and above the costs and expenses of its ascertainment, the surplus to remain for future disposal, If the interest was not enough to cover $1000 and costs, but 'still enough to pay costs, the said costs to be paid, and the balance to be. assigned to Parks, he to reassign to Comstock the said ten shares. If Parks had no interest in said stock, then *35he was to reassign the said ten shares of stock to Com-stock, and Comstock to pay all costs and expenses. In part, this agreement is very clear, and in part uncertain. It is clear that litigation and expense was contemplated as necessary to obtain an adjustment or .determination of - Parks’ interest in the 198 shares of said stock; that if nothing was realized, the entire cost and expense of such litigation should be borne by Comstock;' if Scything was realized and enough to pay such cost and expense, it should first be appropriated for that purpose; if any .amount over such costs were realized, that after paying such costs, it should be appropriated to Comstock to the extent of • $1000, to reimburse him for the ten shares of- stock assigned to Parks; that the overplus, if any, after paying such costs and reimbursing the $1000, Was to remain for future disposal. .
So far there seems no difficulty; but it is exceedingly difficult, satisfactorily to determine what is to be done with that surplus set apart for future disposal. It must be determined from the two instruments and from such other facts connected with the transaction as were proved on the trial. Parks claimed an equal undivided interest in 198 shares of stock valued at about $10,000. Comstock without any interest takes an assignment of that interest to litigate it, at his own cost and expense, if unsuccessful. It is highly improbable that Parks intended to give away all his interest in the 198 shares claimed to be worth $10,000, thus confirming the theory of a defeasance; and the instrument of defeasance canceled, it seems improbable that Comstock Would have undertaken such a prosecution at its own risk, .unless that obligation was coupled with an interest, if successful. Therefore, the fair construction of the defeasance is, that if any overplus remained from the interest in the 198 shares after defraying the litigation and reimbursing Comstock for the ten shares of stock assigned to Parks, it was in some manner to be *36divided between them, but in what proportion is uncertain, and perhaps not necessary to a determination of this suit.
The assignment was a valid transfer to Comstock of Parks’ interest in the 198 shares of stock; the defeasance showed it was transferred to enable Comstock to ascertain the extent of that interest, and when ascertained, if of any value, to be disposed of between them. Therefore Com-stock had an interest in said stock. By the assignment he became a trustee, coupled with an interest, for whatever should be adjudged as belonging to Parks as a member of the firm of S. A. Parks & Co. As such he had the legal title, and being interested, Parks could not settle and adjust the affairs of the partnership without Com-stock’s-assent: Besides, Comstock as the legal owner had a right to manage the claim; it was so contemplated. He did commence an action, and a very proper one, too, in my judgment, to remove obstructions in the way of an action to ascertain the interests of the several members of the firm, and that action is, still pending and undetermined. Before this an action was commenced against Comstock, by Buchanan, to settle the partnership matters of S. A. Parks & Co., which action is . still pending and undetermined; and in that action, by an affirmative defense, all the equities between the members of the firm of g. A. Parks & Co. can be adj usted so as to determine the ■ interest of each in the said 198 shares of stock. There is therefore no evidence of any delay or violation of agreement by the defendant. For aught that appears, he is endeavoring by proper means to ascertain the interest of Parks in the 198 shares of .stock; 911 d until a determination is had, or an amicable settlement or adjustment made by those interested therein, and authorized to act, the extent of that interest cannot be known, the rights of the parties determined or the equities between them adjusted.
*37[St. Lawrence General Term,
October 3, 1865.
Therefore this suit cannot be maintained.
1st. Because there is no such fraud established as would justify setting aside the assignment, or declaring it void.
2d. Because the defendant having assumed responsibility, incurred costs and performed services, has such an interest that the plaintiff cannot revoke the assignment, settle the copartnership matters, and determine the interest he had as such partner in the 198 shares of stock, without the assent of the defendant.
3d. Because if the defendant had no interest even, and if the power of revocation did exist, actions having been commenced by and against Comstock in relation to the matter, the plaintiff" could not revoke the assignment, without, in addition to the offers made, tendering an indemnity against such actions, for all costs and damages.
The complaint was, therefore, properly dismissed, and the judgment should be affirmed.
Such judgment will not prevent another action for the same matter, if a different case can be presented and made out by proof, (a)
Bockes, James and Rosekrans, Justices.]

 The above decision was subsequently affirmed by the Court of Appeals, when the following opinion was delivered by Gray, commissioner.
Gray, Commissioner. The obvious theory upon which the-plaintiff commenced and prosecuted this action was that the agreement of the 17th of June, 1863, signed by himself, the defendant and Wilson, was, as to the plaintiff, fraudulent and void upon the alleged ground that it was imposed upon him by the fraud of the defendant in procuring it to be so written as not to express the actual agreement as made between them. The statement made by the plaintiff on the 19th of February, 1864, that the agreement, as written, did not express their agreement as it was in fact made, and for the purpose of rescinding it, offering to pay the costs of the suit brought by the defendant against Buchanan up to that time, and reassign the ten shares of stock assigned to him by the defendant, was not an act in affirmance of thp contract, but an effort to rescind it by compromise; but when he rested his case after simply introducing the written contracts and this offer, without an effort to establish the alleged fraud, the referee should have dismissed his complaint; assuming *38that the plaintiff’s offer to pay the costs of that suit up to the time of hia offer, was in affirmance of the contract as written. The offer, if it was worthy of any consideration, was-manifestly insufficient. Besides that suit, there was another commenced by Buchanan against both the plaintiff and defendant, in November, 1863, involving the title to the assigned stock, in which the defendant inteiposed an answer, and the issue made by it stood then referred. If offering to pay costs could be of any worth, the defendant’s costs in the latter suit should have been provided for. Nor was the concession made at the close of the evidence, that the interest of the plaintiff in the partnership of Buchanan and himself was sufficient to cover the costs and expenses incurred in the investigation, including the costs up tp the time this action was brought, of any value to the plaintiff. Property sufficient to pay costs was not in any aspect of the case what the defendant was entitled to. He was not bound to concede anything to the plaintiff until not only the ten shares of stock was reassigned, but until “ after costs paid." The plaintiff’s offer to prove that he had, prior to the suit of the defendant against Buchanan, settled with Buchanan their partnership affairs, was quite immaterial. The settlement, if it could be made without the sanction of the defendant, would still leave him exposed to the costs arising out of the suit brought by Buchanan against him and the plaintiff. The judgment should be affirmed.
Judgment affirmed.