Court Opinion

ID: 5303803
Source: CourtListenerOpinion
Date Created: 2022-01-08 03:20:20.252684+00
Date Added: 2024-06-11T08:29:06.700678
License: Public Domain

Finch, J.
(dissenting). I concur in,the holding that the plaintiff may rescind because of the affirmative misrepresentation ’as to the depth of the property, and may recover as against the defendant Scharf. In my opinion the plaintiff may also recover as against the principal defendant McCoy the money which it parted with upon the faith of the misrepresentation. My colleagues agree that there is a quasi contractual obligation resting upon the defendant McCoy to return the money inequitably held, but hold that this result may not be reached because of the failure of -the plaintiff to defend in the Municipal Court summary proceedings although the plaintiff had already started in the Supreme Court this action asking for the return of the money on the ground of misrepresentation,
*237To my mind, the judgment obtained by defendant McCoy in the summary proceedings to dispossess the plaintiff for non-payment of rent under' the voidable lease herein is not res adjudicata as to the present action. As noted, the plaintiff had already started this action, admitting that a lease was entered into, under which rent was to be paid, but seeking to rescind the same because entered into through "misrepresentation. When the defendant McCoy thereafter started the summary proceedings in the Municipal Court, the plaintiff herein did all and more than it was required to do when it moved to enjoin such proceedings. When the plaintiff was defeated upon the motion to enjoin the Municipal Court proceedings, it did nothing inconsistent with this prior action when it defaulted in the Municipal Court action and permitted the plaintiff therein to recover the premises. The plaintiff had no desire to retain possession of the premises and, according to its contention, it was not ultimately liable for the rent, but until a judgment of rescission could be obtained in this action the plaintiff would have to admit that a lease had been made and that rent was due thereunder which had not been paid. ■ Under these circumstances the judgment entered in the summary proceedings upon defendant’s default is not res adjudicata in this action. (Meyerhoffer v. Baker, 121 App. Div. 797; Becker v. Church, 42 Hun, 258; affd., 115 N. Y. 562.) The case of Reich v. Cochran (151 N. Y. 122) is not an authority against this view, since there the court held that the defense of usury made the lease void ab initio. In Reich y. Cochran the finding in the Municipal Court (then the District Court) that there was a valid lease under which the rent was due was a finding inconsistent with the subsequent action which the plaintiff brought to adjudicate that there was never a valid lease on the ground of usury. The plaintiff also acquiesced in the judgment for rent in Reich v. Cochran, by satisfying the same before starting his action to declare the lease void ab initio.
I, therefore, am in accord with the opinion of the learned Special Term and vote to affirm the judgment appealed from.
■ Merrell, J., concurs.
Judgment modified in accordance with opinion of Proskauer, J., and as so modified affirmed, with costs to the respondent against the appellant Scharf, and with costs to the appellant Alice C. McCoy against the respondent. Settle order on notice.