Court Opinion

ID: 5455179
Source: CourtListenerOpinion
Date Created: 2022-01-09 19:16:44.53733+00
Date Added: 2024-06-11T08:32:36.564926
License: Public Domain

By the Coubt,
J. M. Parker, J.
[After stating the facts.]—The question brought here by the appeal is upon the issue of law raised by the demurrer: Does the complaint state facts sufficient to constitute a cause of action ? Manning v. Tyler, 21 N. Y. 567; Id. 502; East River Bank v. Rogers, 7 Bosw. 493.
[The learned judge then recited the statutes above quoted.] —The joint-stock companies mentioned in these acts, are not corporations, but mere partnership concerns, in which the shareholders are partners, and all individually liable as such, These statutes, however, modify the common law in its application to them : First, in respect to the mode of suing the company, and the effect of judgments against it thus obtained, reaching the joint property of the association only: Second, in suspending the right to sue the parties individually for the liabilities of the company, until redress has been thus sought against the property of the association and has failed: Third, in allowing actions after such failure, against any or all of the individual partners, in the language of the act, “as now provided by law,” that is, such actions asnnight have been brought, if the act in question had not-been passed.
It seems to me that we can not, from these enactments, infer the intent to authorize actions against the individual partners upon the judgments so to be obtained against the association. Ho action can be brought against the individual partners upon any demand against the company, until one has been first brought *632against the company upon the same demand, is the clear declaration of the statute. The cause of action, therefore, on which the individual partners are to be sued, is the same as ■that on which the association was sued. The-judgment against the association is not a judgment against the individuals, either in form or effect. It is a statutory judgment, and the statute declares What its effect shall be, that is, as -regards the joint rights, property and effects of the joint-stock company, the same as though it were a judgment obtained, in an action •brought against the company in the ordinary way. As against the individual partners it has no force as a judgment, beyond the effect given it by the statute, and is not a substantive cause of action against them. Bailey v. Bancker, 3 Hill, 188, 192.
' In bringing an action, then, against the individual partners, the complaint should set forth such facts as are sufficient to show the original cause of action against the association, in addition to those made necessary by the act, showing the attempt and failure to collect the demand by judgment and execution, out of the property of the association.
In the case at bar, it would seem that the pleader proceeded upon the idea that a recovery was to be had upon the judgment. against the association, and his demand for judgment is for the amount of that judgment, damages and costs. The defendants’ counsel claims that the complaint being upon the judgment, the action can not be sustained.
-' If the pleader in setting forth Ms cause , of action does in fact -show a good cause of action, although not the one intended, his pleading will nevertheless be sustained upon demurrer, for 'it is to be measured, not by his view of the law, but by the law itsc-lf. We must look, then, into the complaint to ascertain whether it sets forth, by proper allegations, a cause of action independent of the judgment against the association.
It shows the defendants, members of the association, and, besides the proceedings to judgment against the associotion, and the return of the execution unsatisfied, alleges that during the time when they were such members thereof, “The said company became indebted to the plaintiff for goods sold and delivered to its officers and agents for its use and benefit, in the sum of one hundred and sixty-two dollars and fifty-one *633cents.” This is the whole statement of'facts. Do they constitute a cause of action ?
I confess I am quite unable to see a cause of action in the statement. The fact that the company, in 1857, became indebted to the plaintiff in a sum named, for goods sold and delivered to its officers .and agents for its use, does not make out a present right of action against the company, without the further fact of a present duty and a breach of it. “ The breach of the contract,” says Chitty, “being obviously an essential part of the cause of action, must in all cases be stated in the declaration.” 1 Chitty Pl. 365. This, in the complaint under consideration, is wholly wanting. It does not even allege an existing indebtedness.
In Allen v. Patterson, 7 N. Y. (3 Seld.) 476, the > complaint was as follows: “ The plaintiff's complain against the defendant for that the defendant is indebted to the plaintiffs in the sum of three hundred and seventy-one dollars and one cent for goods sold and delivered by the plaintiffs to the defendant at his request, on, &c., . . . and the plaintiffs say that there is now due them from the defendant, the sum of three hundred and seventy-one dollars and one cent, for which sum the plaintiffs demand judgment.”
Upon demurrer this court held the complaint good, Judge Jewett, who delivered the opinion of the court, remarking that it contains every statement of fact necessary to constitute a good indebitatus countin debt, according to the mode of pleading before the Code. But in that case the allegation .that “there is now due to the plaintiffs three hundred and seventy-one dollars and one cent,” plainly expressed the fact 'that the purchase price of the goods had become due and remained unpaid, and particular stress was laid by the court upon that allegation.
Chitty, in speaking of the indebitatus count in debt, says : “ The indebitatus count states that the defendant, on, &c., was c indebted to the plaintiff/ in a named sum of money 1 for goods sold/ . . . and although it has been usual to conclude each count with the allegation • that ‘by reason of the sum of money being unpaid, an action had accrued to the plaintiff to demand and have the same from the defendant, being parcel *634of the money above demanded/ yet that allegation is unnecessary, and the usual breach at the end of the declaration will suffice.” 1 Chitty Pl. 394, 7 Am. ed. I am not aware of any case or any book of forms, before or since the Code, which dispenses with the allegation of a breach of the contract or duty on which the action is founded. Indeed, when the action is founded upon the contract, obligation, or duty of the defendant, the very, gist and essence of the cause of action is the breach thereof by the defendant.
Unless a breach is alleged therefor, no cause of action is shown.
I am unable to avoid the conclusion that the demurrer is well taken, and that the judgment of the court below is erroneous and should be reversed.
.All the judges concurred, except Grover and Hunt, JJ., and Fullerton, J., not voting.
Judgment reversed, and judgment fcr defendant on demurrer, with costs.