Court Opinion

ID: 5180698
Source: CourtListenerOpinion
Date Created: 2022-01-06 04:41:44.922666+00
Date Added: 2024-06-11T08:26:33.611160
License: Public Domain

Ingraham, J.:
When this action was before the Court of Appeals on the former appeal (143 N. Y. 377) it was held by the court that, within the principle established in Hun v. Cary (82 N. Y. 65) the complaint stated a perfect cause of action to recover damages at law, with a proper and consistent demand for a money judgment awarding such damages, and that the action was of a legal character. The case of Brinckerhoff v. Bostwick (105 N. Y. 567) was distinguished as being an action by a stockholder who could not sue at law, but was compelled to go into equity to obtain his relief, and whose right of action was wholly and purely of an equitable character, while this action is, in substance, an action by a corporation against its delinquent directors. Upon the question as to whether or not a corporation could sue its directors in equity to recover losses sustained, no opinión was expressed, the court saying: “ Granting that, and granting also what I am not now ready to admit as the law of this State, that the facts pleaded in the present case are sufficient to support the action as an equitable one, we are left by the pleader in- a doubt which can only be solved by recurring to the demand for relief.”- And the court ended its opinion by saying: “ Where the action is for the recovery of money only, it is classed as legal and is triable by a jury; and *513while we have held that we are not concluded by the formal demand of relief, but may look into the facts to see,, nevertheless, if it be not equitable relief which they imperatively require, yet where the facts do not aid us, where they are just as appropriate to a legal as an equitable cause of action, where they are ambiguous as to the subject of inquiry, we must be guided by the relief asked in reaching a conclusion. That, I think, is the situation here upon the assumption most favorable to the plaintiffs, that upon the facts, pleaded, without further allegations, an equitable action could be supported. My doubt about that is very grave, although I leave the question open. If there were further allegations showing, somewhere or in some way, the need of equitable intervention, the difficulty would be removed.”
The plaintiffs claim that they have complied with this provision in the opinion of the Court of Appeals by the 57th paragraph of their complaint and the prayer for relief which, as I understand it, are the only material amendments that have been made. Rone of the allegations in this paragraph of the complaint appear to be allegations of fact, but are conclusions as to the liability of the various defendants and the opinion of the pleader as to the necessity of equitable intervention.
The Court of Appeals having thus determined that the facts alleged in this complaint allege a cause of action at law, we have no right to turn it into an equitable action unless the facts alleged show the necessity for some equitable relief. To thus change a cause of action at law to one in equity affects a substantial right of the defendants, a right to a trial by jury which is protected by the Constitution and which neither the Legislature nor the court can take away. It is not enough to make this an equitable cause of action for the complaint to state a mere conclusion of the pleader that the interposition of a court of equity is necessary. The facts must be stated which indicate the need of such intervention.
There are no facts alleged that show that a discovery is requisite to the completion of the remedy, or that an accounting is necessary to ascertain the damages. (O’Brien v. Fitzgerald, supra.) Rolare any facts alleged which bring this case within any of the principles which courts of equity administer.
*514The allegation that a multiplicity of suits will be required in case 4he-plaintiffs have to sue each defendant, joining with him only ■ those who aided him in the wrongful acts which would make them liable, hardly brings the case within one of the class where the court will intervene to prevent a multiplicity of actions against one individual. Here the multiplicity of actions is against a multitude ■of people, rather than against one person which equity in some cases will enjoin.
A man having 100 promissory notes made by different individuals might as well ask to sue all of them in one action, because if he had to bring the 100 actions against the 100 individuals he would be ’ ..required to bring and maintain a multiplicity of suits.
In the case of Higgins, as Receiver, v. Tefft (4 App. Div. 62), we sought to place a distinction between the liability of a trustee to ■account in equity and the liability of a trustee in an action at law upon the allegation , as to the relation that existed between the trustee and the cestui q%t,e trust, or the property of the trust which had becomelost or wasted, holding that an action for an accounting „ would lie where it was alleged that the relation of the trustee to .4he property were such that a court of equity could charge him with the amount that he had received and compel him to account to the .-court for the disposition which had been made of such property. The fact that a trustee bears such a relation to the property that he -is chargeable with it or its proceeds when called upon for it, either ’by his cestui que trust or by the court, is a basis for an action for an •accounting in equity. If there is no sum of money with which the ' .-director can be charged upon the proof of his relation to the property,. Ire cannot be called to account for any particular property, and thus ¡an action for an accounting will not lie. Where, his liability to his ¿cestui que trust, or to the corporation of which he is a director or ¿¡trustee, is not to account for specific property, but for damages because of his negligent act in the performance of his duty, a different principle arises as to his. liability from that of a case where, in consequence of his relation to the property of the trust, he is bound to show what disposition of that property has been made, -being chargeable with the value of the property. Applying the .distinction that we made in the case of Higgins v. Tefft (supra), it seems clear that, from the facts alleged in the complaint, this action *515cannot be maintained as an action for an accounting in equity.. It is clear, however, that it does set forth a complete action at law against each of these directors; but, if it is an action at law, it is conceded that canses of action are improperly united.
The plaintiffs, however, insist that their action is in equity. They ask only for equitable relief, and they ask to stand or fall upon their complaint as a complaint in an action demanding equitable relief. Applying the principle of the cases above cited, it seems to us that the complaint does not allege facts sufficient to constitute an action in equity, and for that reason the judgment below sustaining the demurrer was right and should be affirmed, with costs.
Yan Brunt, P. J., and O’Brien, J., concurred; Williams and Patterson, JIT., dissented.