Court Opinion

ID: 5210188
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:10:55.377903+00
Date Added: 2024-06-11T08:27:21.241229
License: Public Domain

Ingraham, J. (dissenting):
The facts are stated in the opinion of Mr. Justice McLaughlin, and it is not necessary that I should restate them.
The bond given by the defendant upon which this action was brought recites that the defendant had obtained a judgment against the city of New York for .upwards of $29,000 that there were certain persons who claimed to have furnished materials and filed notice of such claims with the finance department claiming, liens upon the amount due from the city; that the defendant; claims *755that there are no such claims or liens that, are good and valid or should be so paid out of said.fund, but is desirous of protecting the said The Mayor,'Aldermen and Commonalty of the City of Mew York from any loss or damage by reason of any such claims for labor or materials; ” and the condition of the obligation was such that if the defendant would well and truly save, keep harmless and indemnify the mayor, aldermen and commonalty of the city of Mew York and their successors of and from the payment of all such claims so made and filed as aforesaid “ and shall well and truly pay all sum or sums that the said The Mayor, Aldermen and Commonalty of the City of Mew York may be compelled to pay by reason of the establishment and recovery of any such alleged claim or claims by any of said claimants or their legal representatives, and the costs, damages and expenses thereof, then this obligation to be void, otherwise to remain in full force and virtue.”
One of the claims or liens thus specified was finally adjudged good in an action to which both the plaintiff and defendant were parties; the plaintiff, was compelled to pay such claim or lien and actually did pay it; and the defendant has not paid to the plaintiff the sum of money that the plaintiff paid to satisfy such lien. This bond was dated the 26th of May, 1887.
As a defense the answer alleged that on the 19th of April, 1878, the predecessor of this defendant commenced an action against the mayor, aldermen and commonalty of the city of Mew York, one Winant, who was the claimant who succeeded and whose claim or lien the plaintiff paid, and others, for the purpose of having adjudicated, the claims of various persons including said Winant for moneys arising from a contract made between the city and one Gavin for the grading and paving of Lexington avenue; that upon the trial of the said action a judgment was awarded to the said Mechanics and Traders’ Bank against the mayor, aldermen and commonalty of the city of Mew York on the 15th of December, 1886, for a sum upwards of $29,000 ; that thereafter and on the 26th of May, 1887, the defendant in this action compromised and settled said judgment with the city and gave the bond referred to in the complaint, at that time objecting to the validity of the claims of Winant; that thereafter and upon a subsequent trial of the issues in the action raised by the answer of Winant, judgment was awarded and entered *756on the 25 th of June, 1894, in favor of "Winant and against the mayor, aldermen and commonalty of the city of New York for the sum of $5,117.47 damages and costs; that thereafter and within the proper legal time for that purpose, that is, on the 2d of August, 1894, the said bank, the defendant herein, duly appealed to the then General Term of this court from said judgment so rendered in the action to which it was a party, and a copy of said notice of appeal was filed and duly served upon all parties who appeared in that action, including the plaintiff herein; that thereafter a proposed case on appeal was duly served on behalf of the said bank upon all said parties, and subsequently and on or about the 15th óf October, 1894, amendments to said proposed case were served on behalf of said city of New York and also on behalf of said Win ant, and said case and amendments were noticed for settlement before the justice who tried the case and said appeal is still pending and undetermined ; that subsequently and on or about the 7th of November, 1894, the plaintiff, while said case and amendments were awaiting settlement, and said appeal to which the plaintiff, the city of New York, was a party and in which it had participated was pending, paid to said Winant under and in pursuance of. said judgment so appealed from by said bank the sum of upwards of $5,000, and that such payment was made without notice to or the knowledge, consent or acquiescence of this defendant. It was further alleged that pending the appeal the plaintiff gave notice of the payment to all the parties concerned,, including the justice before whom said case was pending for settlement and asserted that the appeal had become academic, and was without practical force or virtue.
Upon the trial the plaintiff rested and the defendant called its president and offered proof of conversation between him and the corporation counsel with reference to this claim of Win ant’s, and that subsequent to the giving of the bond the president had no relations with the city authorities in relation to this claim, and no demand was made on the bank for its repayment. This, evidence was excluded. The cashier of the defendant was then called and testified that Mr. Dean, an assistant corporation counsel, -conducted the negotiations which involved the settlement of this claim,, the payment of the defendant’s judgment and the giving of this bond on behalf of the city of New York. He was then asked whether there *757were any conversations regarding the right of the bank to appeal to the appellate court from any judgment that might be obtained against the city from any claims mentioned in the bond, and whether he stated to the assistant corporation counsel that the bank insisted upon the right to appeal to the Court of Appeals, if necessary, and whether the city of New York ever made "a demand upon the defendant for a payment on account of the Winant transaction. This was all objected to and excluded and the defendant excepted. This testimony was all immaterial and did not tend to establish a defense. The bond was an absolute obligation of the defendant to be void only in the event that the defendant paid any and all sum or sums that the mayor, aldermen and commonalty of the city of New York should be compelled to pay by reason of the establishment and recovery of any claim or claims by any of the said claimants or their legal representatives. One of such claimants recovered a judgment against the city which the defendant has not paid, and whether the bank insisted upon the right to appeal to the Court of Appeals or not was not material. The defendant then called an attorney at law who was associated with the defendant’s attorney in reference to this Winant claim. He was asked whether subsequent to that judgment he conducted an appeal therefrom on behalf of the defendant, which was objected to, whereupon counsel for the defendant stated that he desired to show that on the 2d of August, 1894, the Mechanics and Traders’ Bank took an appeal from the judgment to the General Term of this department, filed its notice of appeal in the county clerk’s office, and served copies thereof upon the attorney for Winant and the corporation counsel. Having made this offer, the defendant then offered a notice of appeal from the judgment filed August 2,1894, the case made, and the proposed amendments to the case, which' were admitted, and then offered to prove a conversation in relation to the appeal with Mr. Dean respecting an intention on his part to settle the Winant judgment, the protest by the defendant against such settlement, and the submission of the case and amendment fo the trial judge for settlement. He then further offered to show that the papers were returned by the trial judge, and the .conversation between the trial judge and the witness that, as the Winant claim had been paid, the appeal no longer existed, and a further conversation with Mr. Dean after the *758papers were returned from the trial judge. This testimony was excluded, and the defendant excepted. The defendant then rested, and the court directed a verdict for the amount of the bond and interest.
It seems to me that this testimony was all incompetent and'was properly excluded. There was nothing to prevent ‘ the defendant from prosecuting its appeal from the judgment establishing a lien in favor of Winant. The plaintiff was not an appellant. It was entirely immaterial to the defendant whether the city had paid the claim or not. If the defendant had succeeded in reversing the judgment establishing the validity of the Winant .claim,'it could not have been held upon its bond. If the city paid the claim pending an appeal, it did so at its own risk of having- the judgment reversed on the appeal by the defendant from the judgment establishing that claim. The defendant failed to prosecute its appeal, for what reason is entirely immaterial, and the failure to so prosecute the appeal or procure a reversal of the judgment made it liable upon its bond. Hothing that the city did or could do in this case could take away the right of the defendant to appeal from the judgment establishing the Winant claim, and if it had prosecuted that appeal successfully, it would be discharged from, any obligation on the bond to the city. The situation was that the defendant had received from the city the amount of money as belonging to it that the court subsequently .adjudged belonged to Winant. The defendant had appealed from the judgment in favor of Winant,-and was entitled to prosecute that appeal. If Winant’s claim or lien was not valid, and the judgment sustaining its validity had been reversed, there would have been no claim on behalf of the city in relation to this bond. But that judgment never has been reversed; it still stands in full force and effect,; and the city has paid it. The condition of the bond lias, therefore, been broken, and if the defendant has lost its right to have that judgment reversed, it is because it voluntarily abandoned its appeal.
The defendant relies upon the ease of City of New York v. Baird (176 N. Y. 269), but in that case the situation was entirely different. That was an action against the city of Hew York and Baird as jointly liable for injuries sustained by one Kelly in consequence of negligence in the performance of a contract by Baird with the city. While that action was pending the city paid to *759Baird the amount due on his contract, taking hack a bond with Baird as principal and a surety conditioned for the payment and satisfaction of any judgment which should be obtained in the action brought by Kelly against the city. The trial of that action resulted in a judgment against Baird and the city jointly, from which an appeal was taken by both Baird and the city. While that appeal was pending the city, against the protest of Baird, paid the judgment and thus abandoned its appeal, and the defense was that that payment to Kelly was made in bad faith, and in violation of Baird’s rights. It is perfectly apparent that in that case the payment by the city at once prevented Baird from prosecuting his appeal, for the judgment having been paid by one 'of those jointly liable for the tort, Baird had no opportunity of prosecuting the appeal and establishing his freedom from negligence. There the city was appealing. The abandonment of the appeal and the payment of the judgment prevented Baird from prosecuting his appeal, and this imposed upon Baird and his surety a liability upon the bond. In determining that question the court'said: “It would be strange indeed if as a result of such action the-city of New York could recover on the bond should the continuance of the appeal by Baird result in a reversal of the judgment without possibility of a recovery against him on a new trial. And on the other hand it would equally offend against justice to' deprive the municipality of the benefit of the wisdom of its officers should it happen that they were wise in concluding either that- the judgment would not be reversed, or, if reversed, that it would be for technical reasons, with the result that the subsequent verdict would be for an equal or greater amount.” And the judgment was reversed because it deprived the defendant of the opportunity of having the question of the good faith and fair dealing on behalf of the municipality passed upon. The whole decision of the court was based upon the fact that the city, by withdrawing its appeal and paying the judgment, had deprived the defendant in that case and his surety of the right to review without' taking the chance of loss should such review, and a subsequent trial had pursuant to it result favorably to the principal. It is apparent in this case that nothing that the city did deprived the defendánt of the right to prosecute its appeal and procuring a reversal of the judgment which *760established Winant’s claim. But the answer does not allege that the city acted in bad faith or that anything that the city did prevented the defendant’s appeal from the judgment establishing Winant’s claim, and in the absence of such a defense in the answer it certainly was not error for the court to exclude testimony which it was claimed would tend to establish it. Nor did the defendant make any such claim on the trial. The testimony was only to show that the city was not compelled to pay the. judgment in favor of Winant, because the defendant’s appeal was still pending and that the city had made no. demand upon the defendant for the amount that it had paid to Winant. Neither of these facts constituted a defense to the action, and in view of the fact that nothing that the city did or could do could take away the defendant’s right to review the judgment establishing Winant’s claim, and that the defendant has failed to allege that the settlement was made in bad faith, it seems to me the ruling of the court was clearly right.
For that reason the judgment appealed from should.be affirmed.
Laughlin, J., concurred.
Judgment and order reversed, new trial ordered, costs to appellant to abide event.