86 N.Y. 75, Gould v. Cayuga County Nat. Bank

Citation:86 N.Y. 75
Party Name:BENJAMIN GOULD, Appellant, v. THE CAYUGA COUNTY NATIONAL BANK et al., Respondents.
Case Date:October 04, 1881
Court:New York Court of Appeals

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86 N.Y. 75




New York Court of Appeal

October 4, 1881

Argued Apr. 21, 1881.

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George F. Comstock for appellant. A party who claims to go behind a contract, and recover a right in opposition to it, on the ground of fraud, or other ground, must first restore what he received through the contract. (49 N.Y. 623; 61 Id. 145; 13 Barb. 641; 21 Id. 82; 32 Id. 171.) There is no point of view in which the plaintiff has or ever had any act to perform in relation to the collateral trust. The judgment will protect all rights in the trust fund. (Allerton v. Allerton, 50 N.Y. 670; Mason v. Bovet, 1 Denio, 69; Hammond v. Pennock, 61 N.Y. 145.) The action is not barred as to the defendant Beardsley by the statute of limitations. (Harper v. Fairly, 53 N.Y. 444, 445.)

W. F. Cogswell for respondents. The paper executed to the bank by plaintiff, dated March 12, 1873, is a full and complete discharge of the cause of action asserted against it. (McCrea v. Purmort, 16 Wend. 460, 474; Stearns v. Tappan, 5 Duer, 294.) To sustain an action for fraud, founded upon representations made by defendant, it must be made to appear that he believed, or had reason to believe at the time he made them, that the representations were false, or that without knowledge he assumed or intended to convey the impression that he had actual knowledge of their truth, and that plaintiff relied upon them to his injury. (Wakeman v. Daily, 51 N.Y. 27; Myer v. Amidon,

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45 Id. 169; Oberlander v. Spiess, Id. 175; Craig v. Ward, 3 Keyes, 387.)The contention on the part of the plaintiff is an attempt to hold the defendants liable for a fraud-without the necessary element of willful falsehood. (Oberlander v. Spiess, 45 N.Y. 177.) The plaintiff cannot set up that the release was void for fraud, because he had not returned the consideration for which that release was given. (1 Story on Cont., § 623 [[5th ed.]; Mason v. Bovet, 1 Denio, 69; Dubois v. Hermance, 56 N.Y. 673; Jennings v. Gage, 13 Ill. 610; Tisdale v. Buckmore, 33 Me. 461; Coche v. Rucks, 34 Miss. 105; Evans v. Gale, 17 N.Y. 537; Kerr on Fraud, 327 [Am. ed.]) The plaintiff cannot assail this release for the still further reason that the bank cannot be restored to the condition of things as they stood at the time it was made. (2 Kent, 480; Story on Cont., § 623; Clark v. Dickinson, Ellis, Blackburne & Ellis, 148; Chance v. Comrs. of Clay Co., 5 Black [Ind.], 441; Pattus v. Roberts, 6 Ala. 811; Buell v. Tale, 8 Blackf. 55; Calhone v. Davis, 3 Ind. 532; Lattea v. Hinder, 19 Id. 93; McGuire v. Callahan, Id. 128; Griffith v. Fred County Bank, 9 Gill. & J. 424; Conner v. Henderson, 15 Mass. 319; Brown v. Wither, 10 Ohio, 142; Hammond v. Buckmaster, 22 Vt. 375; Moore v. Bare, 11 Iowa, 198; Potter v. Titcomb, 22 Me. 800.)


This action was brought to recover damages for the alleged breach of an agreement made by the defendants to return to the plaintiff certain United States bonds loaned by him to the bank, in June, 1865, the defendant Beardsley being surety for the bank. The defendants, in their answer, interposed several defenses, among which were the statute of limitations and the return of the bonds to the plaintiff. They also set up that, before the commencement of the action, the plaintiff called upon the bank for the return of the bonds, claiming that they had not been returned to him, and that the defendants denied plaintiff's claim, alleging and claiming that the bonds had been returned to him by the bank, and that thereupon the parties entered into a compromise agreement, whereby the bank agreed to pay the plaintiff, in satisfaction of his claim

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against it, the sum of $25,000, and that it paid, and plaintiff accepted, that sum in satisfaction of his claim against it for the bonds loaned.

Upon the trial the plaintiff proved the loan of the bonds and that they had not been returned to him, and then rested his case. The defendants then proved the compromise agreement, and the payment of the $25,000, and rested their case. The plaintiff then gave evidence tending to show that he was induced to enter into the compromise agreement by the fraud of the defendants. The plaintiff did not, prior to the commencement of the action, return or offer to return to the bank the $25,000 paid by it. After the defendants had at the trial taken the objection that the plaintiff had not returned or offered to return the money, and at the close of the evidence, the plaintiff paid into court the sum of $25,000, with the interest thereon from the time of payment, and at the same time, as explanatory of the payment, filed a paper of which the following is a copy, to wit: "The plaintiff now deposits in the court with the clerk thereof the sum of $35,159.72, a sum equal to a certain sum of $25,000, which was paid to the plaintiff by the defendant The Cayuga County National Bank, or by Josiah N. Starin, the 12th day of March, 1873, as set forth in a certain receipt or instrument of writing of that date mentioned in the pleadings and proofs in this action, and the interest upon such sum until the 1st day of January, 1879. The said deposit being made under the following conditions:

'First. The said deposit shall remain in the custody of the court and not paid to either party until final judgment shall be rendered in such action. The court by rendering such judgment or by its action under the judgment shall restore such deposit to the plaintiff unless it shall be determined in and by such final...

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