Jonathan Ring & Son, Inc. v. Winola Worsted Yarn Co.

• Decision Date: 24 February 1920
• Citation: 228 N.Y. 127,126 N.E. 514
• Court: New York Court of Appeals Court of Appeals
• Parties: JONATHAN RING & SON, Inc., v. WINOLA WORSTED YARN CO. et al.

228 N.Y. 127

126 N.E. 514

JONATHAN RING & SON, Inc.,

v.WINOLA WORSTED YARN CO. et al.

Court of Appeals of New York.

Feb. 24, 1920.

Action by Jonathan Ring & Son, Incorporated, against the Winola Worsted Yarn Company and others. A judgment dismissing the complaint on the merits was unanimously affirmed by the Appellate Division (162 N. Y. Supp. 1125), and plaintiff appeals.

Reversed.

See, also, 170 App. Div. 918,154 N. Y. Supp. 1128.

Appeal from Supreme Court, Appellate Division, Second department.

Sidney J. Loeb, of New York City, for appellant.

Adolph Feldblum, of New York City, for respondents.

HISCOCK, C. J.

At the time of the occurrences involved in this action the appellant was a large creditor of the defendant Plate & Clark Company. It brought this action to procure a judgment declaring a mortgage made by that company to the respondent Manufacturers' National Bank of Brooklyn void under section 66 of the Stock Corporation Law (Consol. Laws, c. 59), on the ground that at the time when such mortgage was executed the mortgagor was insolvent or subject to imminent insolvency, and intended by such lien to give a preference to the bank.

On the trial at the close of its case appellant's complaint was dismissed. Upon this dismissal at different times respectively two different judgments were entered against it. The first one was a judgment dismissing its complaint as upon a motion for a nonsuit; the second one was entered upon findings, and dismissed the action upon the merits. It is this latter judgment, now unanimously affirmed by the Appellate Division, which is before us for review, and inasmuch as the fundamental question is the one whether there was any power to make such a judgment, it will be necessary to review with some detail the occurrences at and after the trial.

At the close of the appellant's case and without resting, wherefrom the inference flows of an intent to present evidence if its motion should be denied, the respondent moved ‘to dismiss the complaint as to the defendant Manufacturers' Bank.’ The court addressed to plaintiff's counsel the question, ‘How have you made out any case against the Manufacturers' National Bank?’ Thereafter followed a long discussion of the question whether plaintiff had produced any evidence to establish certain necessary facts, and finally, having announced that in his opinion the plaintiff ‘had failed to show that the mortgagor at the time of the conveyance was insolvent or that insolvency was imminent,’ the court granted the motion to dismiss the complaint. Thereafter on the motion of the respondent's attorney a judgment was entered simply dismissing the complaint, and which it is now conceded was not upon the merits. No findings were made or requested by either party. From this judgment an appeal was taken by the plaintiff, and upon the resistance of the respondent its appeal was unsuccessful and the judgment was affirmed.

After all of this and the expiration of nearly three years, and when certain exigencies apparently required a judgment on the merits, an application was made for an order vacating the judgment which had been entered as ‘premature and unauthorized by law,’ and to remit the case to the justice before whom it had been tried for ‘formal decision of the issues framed by and tried under the complaint herein’; the meaning of this being that there should have been a judgment on the merits instead of one of nonsuit. At a Special Term held by the justice before whom the case was tried this application was denied for lack of power. On appeal to the Appellate Division, however, it was held that power was not lacking to grant the application, the order was reversed, and the motion was remitted to a Special Term held by the said justice to be heard and determined on the merits. Under this decision an order was made at Special Term vacating the existing judgment and remitting the case to the justice before whom the case was originally tried for ‘formal decision on the issues framed by and tried under’ the pleadings, and the justice having reached the conclusion that he originally intended to dismiss the case upon the merits, findings were then made and a new and second judgment was entered accomplishing this result, and which is the judgment now under review.

The appeal presents an unusual aspect of litigation. There is no question of the power of the Supreme Court to correct various errors which may have crept into and affected its proceedings including a judgment, but we think it is going beyond any line heretofore reached to hold that at the expiration of nearly three years, upon the application of a party who entered it and sustained it upon appeal, a judgment of nonsuit may be vacated and another judgment entered upon findings then made dismissing the complaint upon the merits on the ground that there was an intention to have made such latter judgment. However, without conceding that such an unusual course may be properly pursued, we shall nevertheless, for the purposes of this appeal, assume that there might be circumstances under which all this might be done if an error had really been made.

[1] But certainly we cannot assume, and we think that no one will gravely argue, that if the original disposition which was made of the case was actually and fundamentally one of nonsuit, and not a dismissal upon the merits, the successful party could subsequently get rid of this judgment and secure in its place a second one upon the merits, even though there may have been originally some unexecuted purpose upon the part of counsel and court...