Klein v. D. R. Comenzo Co.
| Decision Date | 01 December 1960 |
| Citation | 207 N.Y.S.2d 739 |
| Parties | Deborah KLEIN and Ernest Klein, Plaintiffs, v. D. R. COMENZO COMPANY, Defendant. |
| Court | New York City Municipal Court |
Benjamin Isaacs, New York City, for plaintiffs.
Katz, Wittenberg & Katz, New York City, by Frank C. Wittenberg, New York City, of counsel, for defendant.
The motion to set aside the directed verdict in favor of the defendant is denied.
The agreement between the parties for the purchase of stock, as testified to by plaintiff and as outlined in the Bill of Particulars, obviously contemplates the extension of credit beyond the time permitted by the Federal Reserve System regulation.
The Court has no doubt that it is the public policy of the United States (see Securities Exchange Act of 1934, 15 U.S.C. § 78b and especially § 78g, 15 U.S.C.A. §§ 78b, 78g, and Regulation T issued pursuant thereto by the Board of Governors of the Federal Reserve System) to discourage and prevent the purchase of stock on extended credit.
Defendant, under Civil Practice Act, § 242 and under general principles of pleading, should have pleaded the illegality of the contract as an affirmative defense.
However, 'it is not necessary to plead the illegality of a contract which is contrary to public policy; the court will, of its own motion, step in and deny the right to any relief thereunder without reference to the state of the pleadings, whenever it becomes apparent that the agreement is antagonistic to the interests of the public.' Attridge v. Pembroke, 235 App.Div. 101, at page 102, 256 N .Y.S. 257, at page 260. Such must be the law, for otherwise a court of law could be placed in the ridiculous position of having to enforce an illegal contract because of ignorant or conniving litigants. See also Oscanyan v. Arms Co., 103 U.S. 261, 26 L.Ed 539; Roberts v. Criss, 2 Cir., 266 F. 296, at page 302, 11 A.L.R. 698.
Courts are not to be used to enforce contracts against public policy merely because defendants fail to properly plead affirmative defenses. Motion denied.
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...United States, the contracts are illegal and cannot be enforced (see, Silvera v. Safra, 79 Misc.2d 919, 361 N.Y.S.2d 250; Klein v. D.R. Comenzo Co., 207 N.Y.S.2d 739; Kaiser-Frazer Corp. v. Otis & Co., 2nd Cir., 195 F.2d 838, cert. denied 344 U.S. 856, 73 S.Ct. 89, 97 L.Ed. 664). Although t......
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McCall v. Frampton
...may, nevertheless, refuse to enforce a contract, if it finds that the contract is violative of public policy (see Klein v. D. R. Comenzo Co., Mun.Ct., 207 N.Y.S.2d 739). To define public policy is often difficult, for it is a concept which is flexible. The Court of Appeals has recently addr......
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National Recovery Systems v. Mazzei
...adduced that the agreement is antagonistic to the public interest, despite a defendant's failure to plead (Klein v. D.R. Comenzo Company (N.Y.Mun.Ct.) 207 N.Y.S.2d 739; see also Dodge v. Richmond, 10 A.D.2d 4, 196 N.Y.S.2d 477). Similarly, when such evidence is presented on a motion for sum......
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Myer v. Shields & Co.
...well-reasoned opinions in the above-cited cases are sufficiently persuasive authority for holding as we do. Further, Klein v. D. R. Comenzo Co., Mun.Ct., 207 N.Y.S.2d 739, relied on by defendant, does not stated the facts nor does it attempt to deal with the principle applicable to legislat......