Conn. Sav. Bank v. First Nat. Bank & Trust Co.

• Decision Date: 26 February 1947
• Citation: 133 Conn. 403,51 A.2d 907
• Court: Connecticut Supreme Court
• Parties: CONNECTICUT SAV. BANK v. FIRST NAT. BANK & TRUST CO. et al.

133 Conn. 403

51 A.2d 907

CONNECTICUT SAV. BANK

v.FIRST NAT. BANK & TRUST CO. et al.

Supreme Court of Errors of Connecticut.

Feb. 26, 1947.

Appeal from Superior Court, New Haven County; Troland, Judge.

Action by the Connecticut Savings Bank against the First National Bank & Trust Company and others for a declaratory judgment as to whether an issue of fact determined by jury by special verdict in a prior action would be res judicata in a subsequent action. The Superior Court sustained named defendant's demurrer to the complaint and, on plaintiff's failure to plead further, judgment was rendered for defendant, and plaintiff appeals.

Error and case remanded.

Morris Tyler, of New Haven, for appellant.

John W. Barclay and Albert H. Barclay, of New Haven, for appellee.

William J. Secor, Jr., of Waterbury, for appellees Boardman.

Before MALTBIE, C. J., and BROWN, JENNINGS, ELLS and DICKENSON, JJ.

MALTBIE, Chief Judge.

This case comes before us as an appeal from a judgment for the named defendant entered upon the failure of the plaintiff to plead over after a demurrer to the complaint was sustained. The complaint sought a judgment declaring the effect as res adjudicata of a judgment in an earlier action to which the parties to this action were also parties. The demurrer was sustained upon the ground, speaking broadly, that the allegations of the complaint did not afford a basis for relief by way of a declaratory judgment.

The complaint alleged the following in substance: Mary E. and Dr. E. Irene Boardman had an account in the plaintiff savings bank. One Brown presented to it their bankbook with a withdrawal order for $5,000 signed by them, and the plaintiff drew a check on the defendant national bank, to which we shall hereafter refer as the defendant, for that amount payable to E. Irene Boardman. Brown cashed the check, which was indorsed with Dr. Boardman's name, and the defendant ultimately paid it. The Boardmans brought an action against the two banks, alleging that the indorsement was a forgery. This allegation both banks denied, and at the trial of the action both the Boardmans and the defendant introduced evidence upon the issue. An interrogatory was submitted to the jury asking whether the indorsement was written by E. Irene Boardman and they answered that it was not. A verdict was rendered for the Boardmans against the present plaintiff but in favor of the present defendant. The former has appealed from that judgment. It desired to withdraw its appeal, satisfy the judgment and look to the present defendant for redress. But if it seeks damages in an action against the defendant and the question whether the indorsement was a forgery can again be litigated upon evidence other than the earlier judgment, it would take the chance of an adverse judgment; and so it was not in a position where it could safely withdraw its appeal and pay the claim of the Boardmans. If the issue of foregery is declared to be res adjudicata as regards the defendant, the plaintiff would withdraw its appeal in the earlier case, pay the Boardmans and, with the permission of the court, amend its complaint in this action to claim damages. There is between the parties an actual bona fide and substantial question and issue, and a substantial uncertainty of legal relation requiring settlement. The plaintiff asks a judgment declaring whether the issue of forgery has become res adjudicata as between it and the defendant.

While this case was pending before us, the appeal in the action brought by the Boardmans against the parties to this action came on for hearing and we have, contemporaneously with this decision, sustained their right to recover of the plaintiff in this action. The plaintiff, however, still presses us to decide this case; and, as we shall point out, there are certain practical advantages which may come to it by our doing so which, if anything, have become of more importance to it in its present situation.

The first ground of demurrer was that the situation presented did not fall within the statute and rules giving the Superior Court power to render declaratory judgments. In furtherance of statutory authority given to that court by § 5334 of the General Statutes to render judgments declaring ‘rights and other legal relations,’ we have adopted certain rules of practice which we have said are in accord with and correctly carry out the purpose of the statute. Braman v. Babcock, 98 Conn. 549, 553, 120 A. 150. They provide that the court may render declaratory judgments ‘as to the existence or non-existence (a) of any right, power, privilege or immunity.’ Practice Book, § 249. It has been said, correctly, that this provision is based upon Hohfeld's analysis of jural relationships. Hohfeld, Fundamental Legal Conceptions, p. 65. The words quoted, as used by Hohfeld and in the rule, are intended to include all kinds of such relationships. Of a statute similar to ours, the New York Court of Appeals has said: ‘We may not limit by judicial construction a power which the Legislature has confirmed without limitation. We may not define the bounds within which that power may be exercised, except as we find such bounds implicit in the statute, read in the light of established public policy’ (or, we add, in the rules adopted under authority of the statute). Westchester Mortgage Co. v. Grand Rapids & I. R. Co., 246 N.Y. 194, 199, 158 N.E. 70, 72. That our statute and rules undoubtedly were designed to reach beyond declarations of law which would finally determine the rights of the parties as regards each other definitely appears from the further provision in § 249 of the rules which authorizes judgments as to the existence or nonexistence ‘of any fact upon which the existence or nonexistence of such right, power, privilege or immunity does or may depend.’ To bring the situation before us within the word ‘right’ as used in the rule presents, it is true, serious difficulty; but, if not within that classification, it would fall within the word ‘immunity.’ The plaintiff is seeking a declaration that if it brings an action against the defendant to recover the amount of the judgment against it in the previous action it will be immune from the obligation of establishing that the indorsement on the check was forged otherwise than by reason of the final determination of that issue in that action, with the correlative disability on the part of the defendant to disprove that claim by other evidence. Hohfeld, op. cit., p. 8. It was within the power of the Superior Court to render a judgment declaring whether, as between the parties to this proceeding, the judgment in the previous action was res adjudicata as regards that issue. The first ground of demurrer was not sound.

The other grounds of demurrer are based upon certain provisions in our rules which condition the rendition of declaratory judgments. It is sufficient for the disposition of these grounds to state briefly the specific claims made before us in support of them and the basis of the ruling of the trial court as it appears in its memorandum of decision. The essential position of the defendant is that an action for a declaratory judgment properly lies only where a failure to grant it would cause the plaintiff a loss of rights, and that it does not lie where there is an adequate remedy in the usual course of judicial proceedings or where the court is of the opinion that the parties should be left to seek redress by some other form of procedure. The application of these contentions to the case before us rests on the fact that, in an action in the usual form brought by the plaintiff against the defendant to recover damages based on the payment of the check by the latter upon the forged indorsement, the plaintiff could make the same claim it now advances as to the conclusiveness of the judgment in the earlier action, and on the claim that it could thus secure a determination of that issue more simply and directly.

Section 250 of the Practice Book provides in part: ‘The Superior Court will not render declaratory judgments: (a) Upon the complaint of any person unless he has an interest, legal or equitable, by reason of danger of loss or of uncertainty as to his rights or other jural relations; or (b) unless there is an actual, bona fide and substantial question or issue in dispute or substantial uncertainty of legal relations which requires settlement between the parties; or (c) where the court shall be of the opinion that the parties should be left to seek redress by some other form of procedure.’ Our statute, which antedated the Uniform Declaratory Judgments Act, is broader in scope than that act and the statutes in most, if not all, other jurisdictions. We have consistently construed our statute and the rules under it in a liberal spirit, in the belief that they serve a sound social purpose. Sigal v. Wise, 114 Conn. 297, 301, 302, 158 A. 891; New Haven Water Co. v. New Haven, 131 Conn. 456, 464, 40 A.2d 763. We have...