Tanbro Fabrics Corp. v. Beaunit Mills, Inc.

• Decision Date: 29 October 1957
• Citation: Tanbro Fabrics Corp. v. Beaunit Mills, Inc., 167 N.Y.S.2d 387, 4 A.D.2d 519 (N.Y. App. Div. 1957)
• Court: New York Supreme Court — Appellate Division
• Parties: TANBRO FABRICS CORPORATION, Plaintiff-Appellant-Respondent, v. BEAUNIT MILLS, Inc. and Amity Dyeing & Finishing Co., Inc., Defendants-Respondents-Appellants. BEAUNIT MILLS, Inc., Plaintiff-Respondent-Appellant, v. TANBRO FABRICS CORPORATION, Defendant-Appellant-Respondent. TANBRO FABRICS CORPORATION, Plaintiff-Appellant-Respondent. v. AMITY DYEING & FINISHING CO., Inc., Defendant-Respondent-Appellant.

Page 387

167 N.Y.S.2d 387

4 A.D.2d 519

TANBRO FABRICS CORPORATION, Plaintiff-Appellant-Respondent, v. BEAUNIT MILLS, Inc. and Amity Dyeing & Finishing Co., Inc.,

Defendants-Respondents-Appellants.

BEAUNIT MILLS, Inc., Plaintiff-Respondent-Appellant, v. TANBRO FABRICS CORPORATION, Defendant-Appellant-Respondent.

TANBRO FABRICS CORPORATION, Plaintiff-Appellant-Respondent. v. AMITY DYEING & FINISHING CO., Inc., Defendant-Respondent-Appellant.

Supreme Court, Appellate Division, First Department.

Oct. 29, 1957.

Samuel Gottlieb, New York City, of counsel (Bernard Beitel with him on the brief, Gainsburg, Gottlieb, Levitan & Cole, New York City, attys.) for Tanbro Fabrics Corp.

S. Hazard Gillespie, Jr., New York City, of counsel (Louis L. Stanton, Jr., New York City, with him on the brief, Davis, Polk, Wardwell, Sunderland & Kiendl, New York City, attys.) for Beaunit Mills, Inc.

Irving Abraham, New York City, of counsel (Muhlstock & Blei, New York City, attys.), for Amity Dyeing & Finishing Co., Inc.

Before PECK, P. J., and BREITEL, BOTEIN, RABIN, and VALENTE, JJ.

BREITEL, Justice.

Stripped of procedural details, the question here is whether a buyer of textile goods may obtain a single trial against the seller and the processor of the goods, either by joinder in a single action, or by consolidation of actions, to determine whether the goods are defective, and if so, whether the defect is the consequence of breach by the seller, or the processor, or both of them. Special Term held that such joinder or consolidation is not available. A contrary view is reached here. It is held that the buyer is entitled to have such a common trial, either by joinder in a single action or by a consolidation of actions.

The underlying business dispute spawned three lawsuits. In the first action (the second in the captioned title), the seller, Beaunit, sought to recover the purchase price of goods sold and delivered to Tanbro. The Buyer, Tanbro, counterclaimed for breach of warranty for improper manufacture, as a result of which the goods were subject to 'yarn slippage'. The seller replied to the counterclaim by denying that the slippage was due to improper manufacture. A portion of the goods still being in the hands of the processor, Tanbro initiated another action (the third in the captioned title), in replevin, to recover these goods. The processor, Amity, counterclaimed for its charges and asserted its claim to the goods under an artisan's lien. In the exchanges that preceded and attended the bringing of these lawsuits, the buyer Tanbro received Beaunit's assertion that the yarn slippage was caused by the processor's improper handling, while with equal force the processor charged the same defect to Beaunit as a consequence of its improper manufacture.

At this juncture, Tanbro, the buyer, brought the third lawsuit (the first in the captioned title) against Beaunit and Amity, charging the goods were defective because of yarn slippage and that such slippage was caused by either the seller, Beaunit, or alternatively the processor, Amity, or both. This is the main action before the court.

At Special Term, the buyer Tanbro moved to consolidate the three actions. Beaunit and Amity separately cross-moved to dismiss the complaint in the buyer's main action on the ground that there were prior actions pending between the parties with respect to the same cause of action. The motion to consolidate was denied and Beaunit's cross-motion to dismiss the complaint as against it was granted.

The order should be modified by granting the consolidation, denying the cross-motion of the seller Beaunit to dismiss the complaint as to it in the buyer's main action and otherwise affirming the order.

Both the seller and the processor resist consolidation. They do so on the ground that each had a separate and different relationship to the buyer, and that each was involved in a separate and independent contract. Therefore, they say, there is not involved the 'same transaction or occurrence', nor any common question of law or fact to sustain either a joinder of parties or a consolidation of the actions. ¹ They stress that the buyer Tanbro wishes to pit against each other the seller and the processor on the issue of responsibility for the alleged defect, while the buyer sits back free from the obligation to prove a full case, as it would otherwise have to do in separate actions against the seller and the processor. The buyer, on the other hand, argues that what is identical to the cases are the goods and the defect, with the common question of who is responsible for the defect. The buyer concedes that it would have to prove the defect, and also prove that the defect must have been caused by either the seller or the processor or both of them; that, therefore, this involves a single transaction or occurrence and involves a common question of fact.

The controlling statute is Section 212 of the Civil Practice Act. That section is a product of a codification revision in 1949 (L.1949, Ch. 147; Fifteenth Annual Report of N. Y. Judicial Council, 1949, p. 211 et seq.). The portion pertinent to the joinder of defendants reads as follows '2. All persons may be joined in one action as defendants if there is asserted against them jointly, severally, or in the alternative, any right to relief in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all of them would arise in the action. Judgment may be given according to their respective liabilities, against one or more defendants as may be found to be liable upon all of the evidence, without regard to the party by whom it has been introduced.'

A reading of the section by itself would suggest little or no difficulty in permitting a joinder of parties in the buyer's main action o a consolidation of the three actions. However, the section has a history, which has created some confusion as to the meaning and application of the section.

The seller and the processor rely heavily on Ader v. Blau, 241 N.Y. 7, 148 N.E. 771, 41 A.L.R. 1216. The case arose under the predecessor statute permitting joinder, the then section 211 of the Civil Practice Act. In that case the plaintiff sought to join in one death action the person charged with having caused the accident resulting in the injuries ending in death and a treating physician who, it was charged, by his incompetence, was the cause of the decedent's death. The Court of Appeals expressed doubt whether the joinder statute contemplated joinder in such a case, even if the section were given a liberal interpretation. It went on, however, to hold that Section 258 of the Civil Practice Act, since repealed, albeit a restriction on joinder of causes of action in pleading, was a limiting factor in permitting joinder of parties. Applying the statute, it held the joinder impermissible.

In reaction to this decision, and on the recommendation of the Judicial Council, Section 258 was repealed in favor of a broad pleading section (L.1935, ch. 339; First Annual Report of N. Y. Judicial Council, 1935, p. 44.). In making the recommendation, the Judicial Council referred to the Ader case, supra, and the fact that the court had regarded the area of joinder of parties limited by the pleading restrictions of Section 258. It added, 'Complete freedom should be allowed in the joinder of causes of action as in the joinder of parties, and it is submitted that the correct approach to the joinder both of parties and of causes of action is the English one: May the matters conveniently be tried together? The problem is to combine as many matters as possible to avoid multiplicity and at the same time not unduly complicate the litigation for the jury.'

The full effect of the repealer of old Section 258 has, however, not been left to speculation. The Court of Appeals, in Great Northern Telegraph Company v. Yokohama Specie Bank, 297 N.Y. 135, 76 N.E.2d 117, discussed the question frontally. It held that the Ader case, supra was a result of the pleading limitation contained in the old, and now repealed, Section 258. The Court went on to point out that Section 211, as it then was, permitting joinder of parties, was designed to adopt the English practice with regard to joinder in this State, and, accordingly, that the greatest weight should be given to the cases under the English practice. It then referred, among others, to the case of Payne v. British Time Recorder Company (2 K.B. 1), in which it was held that an unpaid seller could join in one action the purchaser, in seeking recovery of the price, and the actual supplier for breach of contract, in the alternative, if it appeared that the supplies did not conform to the sample. And in the Great Northern case, itself, joinder was allowed plaintiff against the Superintendent of Banks for payments due plaintiff, on which claim the Superintendent was asserting as a bar a time limitation provided by statute, and a correspondent Bank, which plaintiff asserted owed...