Cunningham v. Pressed Steel Car Co.

• Decision Date: 23 January 1934
• Citation: 189 N.E. 750,263 N.Y. 671
• Parties: Elizabeth G. CUNNINGHAM, Respondent, v. PRESSED STEEL CAR COMPANY, Appellant.
• Court: New York Court of Appeals Court of Appeals

263 N.Y. 671

189 N.E. 750

Elizabeth G. CUNNINGHAM, Respondent,

v.PRESSED STEEL CAR COMPANY, Appellant.

Court of Appeals of New York.

Jan. 23, 1934.

Appeal from a judgment, entered August 28, 1933, upon an order of the Appellate Division of the Supreme Court in the First Judicial Department (238 App. Div. 624, 265 N. Y. S. 256), which reversed an order of Special Term denying a motion by plaintiff to strike out the answer and for summary judgment in favor of plaintiff, and granted the motion. On January 6, 1933, plaintiff was the owner of four bonds issued by defendant. By each bond the defendant promised to pay to the owner thereof a stated sum ‘on January 1, 1933,’ with interest thereon from January 1, 1923. The four bonds, and the appurtenant coupons, having been presented, on or after January 1, 1933, at the place where they were made payable, and payment having been refused, the plaintiff brought this action at law for the recovery of the sum of the principal and interest. Each bond provided that it was one of an issue secured by an indenture, dated December 30, 1922, between the defendant and a trustee, ‘to which indenture reference is hereby made for a statement of the rights of the holders of said bonds.’ By the terms thereof the right of action on the bonds and coupons was reserved to the trustee unless after request by one-fourth of the bondholders for institution of such an action the trustee shall fail to act within sixty days. The complaint did not allege, and the answer denied, that the conditions precedent to suit required by the trust indenture had been complied with. Calling attention to the fact that, when this action was commenced, the bonds were unpaid and overdue, the Appellate Division held that the covenant in the bond that defendant would pay the principal amount thereof on January 1, 1933, was absolute on its face, and that the reference to the trust indenture did not fairly place the bondholder on notice of any restriction upon defendant's obligation to pay at maturity so as to preclude action at that time by individual bondholders to sue for and collect the principal.Albert Stickney and Frank H. Heiss, both of New York City, for appellant.

Eugene Untermyer and Abraham Shamos, both of New York City, for respondent.

PER CURIAM.

Judgment affirmed, with costs.

POUND, C. J., and CRANE, KELLOGG, O'BRIEN, HUBBS, and CROUCH, JJ., concur.

LEHMAN, J., not sitting.