New York, L. E. & W R. Co. v. McHenry

• Decision Date: 01 January 1883
• Parties: NEW YORK, L.E. & W.R. CO. v. McHENRY.
• Court: U.S. District Court — Southern District of New York

17 F. 414

NEW YORK, L.E. & W.R. CO. v. McHENRY.

United States Circuit Court, S.D. New York.

1883

W. W MacFarland and Wm. G. Choate, for plaintiff.

Stephen P. Nash and B. F. Dunning, for defendant.

COXE J.

This action was tried in New York at the last April circuit, and resulted in the direction of a verdict in favor of the plaintiff for $1,496,823.96. The defendant now moves for a new trial. The complaint is in the following words:

'The plaintiff in the above-entitled action, complaining of the defendant, alleges that the defendant is indebted to the plaintiff in the sum of $1,307,289.17, with interest thereon from the eighth day of July, 1879, in respect of so much money before that time had and received by the defendant to and for the use of the plaintiff, and the plaintiff demands judgment for the sum aforesaid, with interest from the date aforesaid, besides costs.'

Subsequently and before the answer was received, the plaintiff served a bill of particulars, which, after setting out in detail the items of the claim, contained a note or memorandum stating that the figures were taken from an account rendered in an action pending in the high court of justice, chancery division, in England, brought by the Erie Railway Company and Hugh J. Jewett, as receiver, against the defendant; and that the plaintiff was afterwards admitted as a party plaintiff to the English suit. It then proceeds as follows:

'In the said action, * * * after a full accounting, the defendant was, on the eighth day of July, 1879, found to be indebted, on account of such receipts, in a balance amounting to 268,989 pounds 10s. 10d., for which interlocutory judgment was rendered against said defendant on said day, and to recover which balance this action is brought.'

The defendant, by his answer, denies that he is indebted to the plaintiff in the sum stated in the complaint, or in any sum whatever. He alleges that from May, 1872, to December, 1875, he had various dealings and transactions with the Erie Railway Company, and on the first day of January, 1876, the said company was and still is indebted to him for services, and for money expended by him on its behalf, over and above all credits, in the sum of $850,000; that the plaintiff has no right or interest in the claims sought to be recovered, except by assignment from the Erie Company; and he insists upon his right to recoup, so far as may be necessary, his claim against said company.

The plaintiff's proof consisted-- First, of a certified copy of the English judgment before referred to; and, second, of evidence, documentary and oral, showing a transfer to the plaintiff of the demand established by the judgment. The evidence was received under numerous objections and exceptions taken by the defendant. It was urged at the trial, and it is urged now, that the complaint does not state facts sufficient to constitute a cause of action, but simply a conclusion of law; that no transfer to the plaintiff being alleged, none can be proved; that the plaintiff should not have declared on the debt, but on the judgment; that the judgment is not a final, enrolled decree, but interlocutory simply; that the record is incomplete and the certificate insufficient.

The questions then to be considered are: First. Are the averments of the complaint sufficient? If not, are the defects of such a character as to require a new trial to correct them? Second. Should the English record have been received, and is it conclusive evidence of the facts therein adjudicated?

The cause of action accrued, not to the plaintiff, but to the Erie Railway Company; the plaintiff obtained it by purchase. The title having been originally in another, the transfer was one of the facts constituting the cause of action, and should have been alleged. It was necessary to aver and prove that the plaintiff was the real party in interest. The transfer was a traversable fact; unless it was proved, no cause of action was established. The defendant was entitled to be informed by the pleadings of the facts upon which the demand against him rested. Russell v. Clapp, 7 Barb. 482; O'Neill v. Railroad Co. 60 N.Y. 138, 143; Scofield v. Whitelegge, 49 N.Y. 259; Horner v. Wood, 15 Barb. 371; Sheridan v. Jackson, 72 N.Y. 170; Prindle v. Caruthers, 15 N.Y. 425; Martin v. Kanouse, 9 Abb.Pr. 330; Thomas v. Desmond, 12 How.Pr. 321; White v. Brown, 14 How.Pr. 282; Parker v. Totten, 10 How.Pr. 233; Adams v. Holley, 12 How.Pr. 330. Nor is this objection obviated by the suggestion that the decree in the English suit--this plaintiff having been admitted as a party-- is an adjudication that the defendant is indebted to it. This would be cogent reasoning if the action had been upon the judgment and not on the original debt,-- a debt due to the Erie Railway Company and not to this plaintiff.

It was deemed necessary at the trial to present proof of the transfer. If the proof was essential, as it undoubtedly was, then a suitable allegation was required to support it. It is thought, however, that this omission can be supplied by amendment; that for a reason so inconsiderable the court would hardly be justified in sending the plaintiff back for a new trial. The defendant was not surprised; he knew precisely what the cause of action was; the bill of particulars, which may be regarded as a part of the complaint, duly apprised him of the exact nature of the plaintiff's claim. His answer shows that he was not ignorant of it. Indeed, it was stated at the trial that defendant's motion for a commission was opposed solely on the ground that the English judgment was conclusive, and no evidence could be given by the defendant to dispute it. The case is still before the trial court, the cause of action will not be changed by the proposed amendment, and it would seem very clear that it is the duty of the court to permit the plaintiff to conform the pleadings to the proof, rather than to pursue a course which will only tend to prolong the litigation without change of result.

Sections 539, 540, 721-4, of the Code of Civil Procedure, seem to afford ample authority for such relief as is here contemplated. To quote the language of Judge FOLGER in Reeder v. Sayre, 70 N.Y. 180, 190 'The power of amendment of the pleadings is great under the Code. The real limitation to it seems to be that the amendment shall not bring in a new cause of action. An amendment, in this case at trial, allowing the plaintiffs to aver their character as surviving partners, instead of tenants in common, would not change the cause of action. That remained the same, and required no different proof and no additional parties. It needed only that the character, or right in which the plaintiffs sued, should be differently averred. This could have been done at trial. It does not appear that it was done; but as it might have been...