Court Opinion

ID: 9653509
Source: CourtListenerOpinion
Date Created: 2023-08-23 17:48:01.826604+00
Date Added: 2024-06-11T18:12:59.744521
License: Public Domain

CLARK, Circuit Judge
(concurring).
I agree, but would add something on the point of party joinder. Defendant, by formally pleading the availability of Eastern as a party in its answer (using the Second Defense of Federal Form 20), could normally expect to sit back and await steps by its opponent and the court to correct the defect. It succeeded, however, in over-persuading the court to hold Eastern indispensable, in consequence of which the court made no attempt to bring Eastern in and the plaintiff presumably concluded it was hopeless to approach the court further after his motion to amend the finding of ouster of jurisdiction had been turned down. If by this chance defendant can now obtain a retrial of facts clearly and properly settled already, it has secured a purely procedural advantage, beyond its deserts either on the equities of this particular case or on the present New York law. As to the former, it appears unchallenged that Eastern is insolvent; it was a part of the agreements at the basis of this action that Eastern was to be merged in defendant; and defendant completely controlled Eastern by reason of an irrevocable proxy given by plaintiff to defendant’s president for the very purpose of effectuating that control.1 That defendant is the substantial, and Eastern only a formal, party is thus quite clear. As to the latter, the many statutory changes in the New York law of joint obligations, including Debtor and Creditor Law, § 232, passed in 1928, and Civil Practice Act, §§ 1185, 1197-1200, have established that joint obligors need not be sued together there, but may be sued successively. See Restatement, Contracts, N. Y. Annot. to §§ 117-121; 13 Corn. L. Q. 640. What vestiges may be left of the old law is still somewhat in doubt; the dearth of cases suggests that, unlike the old doctrine, the present rule is not obtrusive. It is true that Mr. Justice Harris of the Supreme Court has declined to hold that joint obligations have become completely joint and several. Marine Trust Co. of Buffalo v. Richardson, 171 Misc. 556, 12 N.Y.S.2d 834. But that case and Pickhardt v. First Nat. Bank & Trust Co., 266 App.Div. 781, 41 N.Y.S.2d. 502, show that whatever rights a defendant, co-obligor may still have, they amount at most only to a request or demand that his-joint associate be brought into the case if legally available, a right only to be exercised by a “motion to correct” under Rule-102, Rules of Civil Practice of New York,, and waived by answer. Under these circumstances of fact and law I think it doubtful that Eastern should be thought more-than a proper party here; in any event, in. the present posture of the case failure to-have brought Eastern in below is at most a defect not affecting the substantial rights, of the parties or requiring a retrial of the: facts. F. R. C. P. rule 61.

 Defendant now urges that Eastern still continued to operate, even though it could not pay off its debts, and that the prosy had been returned to plaintiff before suit was brought. But the point is that, whatever the legal form, to the parties at the time Eastern was the unimporant and dominated part of the combine, rather than a co-equal promisor.