Azzolina v. Order of Sons of Italy, Conte Luigi Cadorna, No. 440

• Decision Date: 07 May 1935
• Citation: 179 A. 201,119 Conn. 681
• Court: Connecticut Supreme Court
• Parties: AZZOLINA et al. v. ORDER OF SONS OF ITALY, CONTE LUIGI CADORNA, No. 440, et al.

179 A. 201

119 Conn. 681

AZZOLINA et al. v. ORDER OF SONS OF ITALY, CONTE LUIGI CADORNA, No. 440, et al.

Supreme Court of Errors of Connecticut.

May 7, 1935

Error from Superior Court, New Haven County; Frederick M. Peasley Judge.

Action by Salvatore Azzolina and others against the Order of Sons of Italy, Conte Luigi Cadorna, No. 440, and others, for reimbursement for money alleged to have been paid by plaintiffs to discharge an indebtedness of the named defendant, brought to the superior court and referred to a state referee. Judgment for plaintiffs, and defendants appeal.

Error and cause remanded, with direction.

Josiah H. Peck, of Hartford, and Morris M. Wilder of Meriden, for appellants.

Harry R. Cooper, of Meriden, for appellees.

Argued before MALTBIE, C.J., and HAINES, HINMAN, BANKS, and AVERY, JJ.

HINMAN, Judge.

This action was brought by seven persons as plaintiffs against the named defendant, hereinafter called the lodge, which was a voluntary unincorporated association formed for fraternal and social purposes, located in Meriden, and 108 individual members of that association. The case was duly referred to a state referee, who heard evidence at great length on 31 days, and made report to the superior court. The pleadings and proceedings following the report of the referee are complicated and superficially confusing, and there is no occasion to detail them here. The assignments of error are numerous, but those pursued by the appellants in brief and argument may be concentrated into a few topics. Such facts as are deemed essential to the discussion are mentioned in the course of the opinion.

The original complaint in two counts alleged that the lodge gave notes, one dated December 20, 1928, for $1,785, and another dated February 20, 1929, for $1,775, which the plaintiffs indorsed for accommodation of the lodge, the latter failed to pay, and the plaintiffs were compelled to and did pay, and made a general claim for damages. The nature and scope of the action, as construed and tried by the parties, are indicated in the report and finding of the referee, and appear to be that the plaintiffs, members of the lodge, claimed to have been compelled to pay a debt of the lodge, for which the individual defendant members, as well as the lodge, were liable, and the plaintiffs were seeking to recover from each of them his proportionate share of the common indebtedness so paid by the plaintiffs. It also appears from the report that the major defense interposed was that the building transactions out of which the indebtedness arose were not a project of the lodge but of an organization of individual members thereof called the " Sons of Italy Club," and the obligations growing out of it were those of the club and of a corporation subsequently formed called " Sons of Italy Realty Company," and not of the lodge. Other defenses included denial by all the appearing defendants of any participation in or authorization of the transactions, alleged limitations in the constitution and by-laws of the lodge, and that liability, if any, of members to pay the obligation discharged by the plaintiffs would be joint and all members were not made parties. The " major defense" above mentioned was not formally pleaded. While the allegations of the complaint were somewhat obscure in disclosure that the action was one for contribution (Form 304, Practice Book, p. 238), the record leaves no doubt that upon the hearings and thereafter it was regarded by the parties and tried as, and the findings of the referee manifestly were addressed and appropriate to, an action for contribution.

On the hearings before the referee, it developed from the evidence introduced, and the referee found, that the facts pertaining to and leading up to the notes payment of which was alleged in the original complaint were, shortly stated, as follows: In August, 1925, claims of the Suzio Construction Company growing out of the construction of a building for a home for the lodge were settled by the giving of a mortgage for $17,000 from the lodge to the company, a second mortgage for $4,000 to a third party, the proceeds of which were paid to the company with other cash, and a note for $6,145 to the company, signed on behalf of the lodge by the president and secretary, and indorsed by eleven members, including the plaintiffs. This is the note referred to in the amendment to the complaint (third count) hereinafter mentioned. Subsequently, through default of interest payments, the entire principal of this note became due and payable, the company pressed for payment, and, as a result of negotiations for settlement, offered to accept $4,000 cash. By this time (February, 1928) the lodge was insolvent and without credit, and on February 15th a proposal to borrow $4,000 upon notes in the name of all the members was rejected by the lodge. On February 15th the plaintiffs, indorsers of the note and liable as such, borrowed $4,000 on two notes of $2,000 each to Meriden banks, purporting to be notes of the lodge indorsed by the plaintiffs, although the banks relied entirely on the credit of the plaintiff indorsers, and with the proceeds paid the company and took up the $6,145 note. The notes mentioned in the original complaint were renewals of the two $2,000 notes so given to raise the money to settle the company note.

The referee found, as conclusions of fact, that the building contract with the company and the $6,145 note to it were executed on behalf of the lodge by its authorized officers and agents, and that the execution of the note was ratified and adopted at subsequent meetings of the lodge, that the lodge vote of February 14, 1928, above mentioned, was a repudiation by the lodge and its individual members of any liability for the indebtedness represented by the note, and that the notes of February 15, 1928, and all renewals thereof (of which the notes described in the original complaint were the latest) were the sole and direct obligations of the plaintiffs and not of the lodge.

It thus appeared from the evidence as to the history of the entire transaction that, although the notes described in the complaint were not obligations of the lodge, and the plaintiffs, in being compelled to pay them, did not, by that fact alone, discharge any indebtedness of the lodge itself, they did, on February 15, 1928, pay a debt of the lodge under the original note of August 17, 1925, with funds secured by loans upon notes of which those described in the complaint were renewals. Therefore the referee in his report recommended that the complaint be amended to conform to the facts as so proved. It was in accordance with this suggestion that the plaintiffs eventually, with the permission of the court, filed an amendment to the complaint which added a third count, setting up the giving of the $6,145 note of the lodge to the Suzio Construction Company, indorsement of it by the plaintiffs, and compulsory payment of it by them on February 15, 1928. It appears from the record of subsequent proceedings before the referee on recommittal that he then stated that the amendment substantially conformed to his suggestion.

Error is assigned in granting permission to amend the complaint, but we regard the suggestion of the referee and the consent of the court to amendment in compliance with it as fitting and abundantly justified. The state of proof from the evidence introduced was such as to warrant amendment of the complaint. Practice Book, § 96; Mazulis v. Zeldner, 116 Conn. 314, 317, 164 A. 713. The amendment worked no substantial change in the cause of action; it remained, not an action upon a note or notes, as such, but for recovery on account of payments made by the plaintiffs to discharge an indebtedness which was evidenced by a note. The deficiency in the complaint was in not carrying the statement of the transaction back to the original obligation. The amendment did not, as in O'Hara v. Hartford Oil Heating Co., 106 Conn. 468, 138 A. 438, count upon a different contract or other cause of action foreign to that relied upon in the original complaint. The defendants were afforded opportunity to meet the amendment by pleading and availed of it to the extent of eleven defenses. The filing of the new pleadings did not affect the order of reference. Practice Book, § 168.

The question then presented, whether the pleadings afforded necessity or occasion for the introduction of further evidence, rendered appropriate a recommittal to the referee-the authority best situated to determine it by reason of familiarity with the evidence already received and its scope-and for further hearings and findings if required. Practice Book, § 175; Hoyt v. Pomeroy, 87 Conn. 41, 48, 86 A. 755; Kane v. Kane, 118 Conn. 291, 294, 172 A. 84. As the court, Foster, J., remarked in recommitting the case, the referee " thereupon performs not a new duty but completes the duty originally placed upon him and makes a final report on the amended case."

The supplementary report of the referee to the effect that the situation did not require or warrant the presentation of further testimony and its acceptance by the court appears to be safely sustained by the record before us. Where an amendment to a complaint is made after trial to correspond to the proof offered, and neither under its allegations nor those of subsequent pleadings is any issue presented which has not been litigated, and in regard to which all parties have not had the opportunity...