Clark v. Kirby,

CourtNew York Court of Appeals
Writing for the CourtCRANE
PartiesCLARK et al. v. KIRBY et al.
Decision Date09 July 1926

243 N.Y. 295
153 N.E. 79

CLARK et al.
v.
KIRBY et al.

Court of Appeals of New York.

July 9, 1926.


Action by Elton Clark and others, as trustees, doing business under the name of the Boston Mexican Petroleum Trustees, against John H. Kirby and others. Judgment of the Special Term, dismissing the complaint, was affirmed by the Appellate Division (216 App. Div. 792, 214 N. Y. S. 817), and plaintiffs appeal.

Reversed.

See, also, 204 App. Div. 447, 198 N. Y. S. 172.

[153 N.E. 80]


[243 N.Y. 296]Appeal from Supreme Court, Appellate Division, First Department.

Edward F. McClennen, of Boston, Mass., for appellants.

243 N.Y. 297]James G. Purdy, of New York City, for respondent Van Laningham.
E. G. Budington, of New York City, for respondents Kirby and others.

CRANE, J.

On points of practice and procedure the plaintiffs have been barred from trying this case on the merits. The action is one for the rescission of a contract [243 N.Y. 298]of sale on the ground of fraud. Although the plaintiffs have always insisted upon rescission, both before and after the bringing of this action, have ever stood ready to return the property received, have not used the property since the discovery of the misrepresentations involved in the transaction, our courts thus far have dismissed the plaintiffs' complaint because they later ventured to bring an action in Missouri against one of the defendants and a third party to get back their purchase price and the expenses they had incurred as damages, and which action was discontinued before the trial in this case. Such a result leads to the immediate impression that something must be wrong in the application of our rules of law. The zealous endeavor to bring the defendants into court for their alleged wrongdoing has thus far moved the courts to deny a hearing on the merits.

The facts are these: The plaintiffs are trustees, doing business under the name Boston Mexican Petroleum Trustees, under a declaration of trust, dated May 20, 1919, a copy of which is on file in the office of the commissioner of corporations of the commonwealth of Massachusetts. On November 19, 1920, the defendants, for a consideration price of $116,250, assigned to the plaintiffs a lease of petroleum subsoil rights in lands in Kansas, which the defendant Kirby then held as trustee, ostensibly for himself and the defendants McElhiney, Van Laningham, and Souders. In December, 1920, the plaintiffs first learned of the falsity of the representations which induced them to make the purchase, and they thereupon rescinded the assignment, and gave notice thereof to the defendants, offering to reassign the lease and give up the possession and all further interest in the property. They demanded their money back, and brought this action to get it. In the complaint they set forth a sufficient cause of action for rescission in equity, stating all the necessary elements of the fraud, and asking for the repayment of the consideration, with [243 N.Y. 299]interest, and that they be directed to reassign the lease. The action being in equity, all of these defendants were necessary parties. The defendant Souders was not served with process until April 10, 1922.

On or about February 27, 1922, these plaintiffs commenced an action in Missouri against one of the defendants here, O. L. Van Laningham, and one W. D. Corbin, who is not a party to this action, to recover as damages for their misrepresentations in the sale of the lease mentioned the consideration paid therefor, together with interest and the amount expended by the plaintiffs in seeking to develop the oil fields in reliance upon the false statements. It will be noticed that this Missouri

[153 N.E. 81

action was commenced after all the defendants had been served in the New York action, with the exception of Souders. As above stated, Souders was not served until April 10, 1922.

When Souders, therefore, served his answer in this action in our Supreme Court, he alleged, among other defenses, this suit in Missouri against Corbin and Van Laningham, claiming it as an election of the plaintiffs to recover damages for fraud, and thus an affirmance of the lease purchase, inconsistent with their attempted rescission. By an order of the Supreme Court, affirmed in the Appellate Division (204 App. Div. 447, 198 N. Y. S. 172), the plaintiffs were obliged to serve a reply to this affirmative defense. They alleged that the action in Missouri was not to recover the damages sustained by the fraud in affirmation of the sale; that the action was in no way inconsistent with their claim for rescission; that their agents in Missouri had no authority to commence or proceed with any action inconsistent with the theory of rescission; and that the only action authorized to be taken was against Corbin, who is not a party here. The matters are set forth in full in the reply. It was further alleged that, according to the law of Missouri, an action for rescission and for...

To continue reading

Request your trial
29 practice notes
  • Luitpold Pharm., Inc. v. Ed. Geistlich Söhne A.G. Für Chemische Industrie, Docket Nos. 13–1872–CV
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 10 d5 Abril d5 2015
    ...party that has chosen to assert one of two inconsistent rights from later seeking to vindicate the alternative right. See Clark v. Kirby, 243 N.Y. 295, 303, 153 N.E. 79 (1926) ; Schenck v. State Line Tel. Co., 238 N.Y. 308, 311, 144 N.E. 592 (1924) ; 784 F.3d 97331 E. 14th St. LLC v. 331 Ea......
  • Fuller v. Fried, No. 5346.
    • United States
    • United States State Supreme Court of North Dakota
    • 6 d6 Abril d6 1929
    ...also, Rice v. Friend Bros. Co., 179 Iowa, 355, 161 N. W. 310;Gorman-Head Auto Co. v. Barrett, 78 Okl. 34, 188 P. 1083;Clark v. Kirby, 243 N. Y. 295, 153 N. E. 79;Goldman v. Great Lakes Foundry Co., 230 Mich. 524, 203 N. W. 103. Williston (2 Williston on Sales [2d Ed.] pp. 1536, 1537) says: ......
  • Nordling v. Johnston
    • United States
    • Oregon Supreme Court
    • 18 d3 Maio d3 1955
    ...to restore rights and remedy wrongs; it must never become more important than the purpose which it seeks to accomplish." Clark v. Kirby, 243 N.Y. 295, 153 N.E. 79, quoted with approval in Sheppard v. Blitz, 177 Or. 501, 511, 163 P.2d 519, Closely related to the foregoing question is the def......
  • Thor 680 Madison Ave. LLC v. Qatar Luxury Grp. S.P.C., 17 Civ. 8528 (PGG)
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • 27 d3 Maio d3 2020
    ...alternative right."). "The election of remedies [doctrine] is largely a rule of policy to prevent vexatious litigation," Clark v. Kirby, 243 N.Y. 295, 303 (1926), and is "designed to prevent a party from obtaining duplicate relief for a single wrong and from gaining an unfair advantage over......
  • Request a trial to view additional results
29 cases
  • Luitpold Pharm., Inc. v. Ed. Geistlich Söhne A.G. Für Chemische Industrie, Docket Nos. 13–1872–CV
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 10 d5 Abril d5 2015
    ...party that has chosen to assert one of two inconsistent rights from later seeking to vindicate the alternative right. See Clark v. Kirby, 243 N.Y. 295, 303, 153 N.E. 79 (1926) ; Schenck v. State Line Tel. Co., 238 N.Y. 308, 311, 144 N.E. 592 (1924) ; 784 F.3d 97331 E. 14th St. LLC v. 331 Ea......
  • Fuller v. Fried, No. 5346.
    • United States
    • United States State Supreme Court of North Dakota
    • 6 d6 Abril d6 1929
    ...also, Rice v. Friend Bros. Co., 179 Iowa, 355, 161 N. W. 310;Gorman-Head Auto Co. v. Barrett, 78 Okl. 34, 188 P. 1083;Clark v. Kirby, 243 N. Y. 295, 153 N. E. 79;Goldman v. Great Lakes Foundry Co., 230 Mich. 524, 203 N. W. 103. Williston (2 Williston on Sales [2d Ed.] pp. 1536, 1537) says: ......
  • Nordling v. Johnston
    • United States
    • Oregon Supreme Court
    • 18 d3 Maio d3 1955
    ...to restore rights and remedy wrongs; it must never become more important than the purpose which it seeks to accomplish." Clark v. Kirby, 243 N.Y. 295, 153 N.E. 79, quoted with approval in Sheppard v. Blitz, 177 Or. 501, 511, 163 P.2d 519, Closely related to the foregoing question is the def......
  • Thor 680 Madison Ave. LLC v. Qatar Luxury Grp. S.P.C., 17 Civ. 8528 (PGG)
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • 27 d3 Maio d3 2020
    ...alternative right."). "The election of remedies [doctrine] is largely a rule of policy to prevent vexatious litigation," Clark v. Kirby, 243 N.Y. 295, 303 (1926), and is "designed to prevent a party from obtaining duplicate relief for a single wrong and from gaining an unfair advantage over......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT