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Zimmer v. Brooklyn Sub-Railway Co.

23 Abb. N. Cas. 382 Court N. Y. Supreme Court, First Department, General Term ; English

Delivered by Van Brunt, P. J.

Contents

Majority

p. 382
ZIMMER v. BROOKLYN SUB-RAILWAY CO.
N. Y. Supreme Court, First Department, General Term ;
July, 1889.

Headnote

1. Amendment at the General Term.] The General Term will not permit an amendment of the pleadings to conform to the proof, where such amendment, if allowed, would take from the pleadings an allegation which has been admitted and relied on by the party charged.[1] In an action for personal services under a peculiar agreement between the plaintiff and the directors of a corporation which provided that the plaintiff was to be paid “when the company has the money, it being left to our judgment to say when that time is,” and the complaint alleged that the defendant was without
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money for the payment of the plaintiff’s claim, which allegation the defendant admitted, and it being contended that the proof showed that the defendant had money wherewith to pay the plaintiff’s claim.—Reid, that an amendment conforming the complaint to that state of facts could not be allowed.
2. Contracts; conditional promise to pay.~\ Where a party makes a contract for personal services with the directors of a corporation, payment therefor being conditioned upon the corporation having the money, and it being left to those directors to state when they have the money, a recovery for the services rendered cannot be had on the ground of refusal or neglect on the part of the corporation tp avail itself of its resources to obtain the money, where it appears that further proceedings on the part of the corporation towards attaining the objects of incorporation have been rendered impracticable.
■3. Same.] The plaintiff took upon himself, by such a contract, the risk of the corporation having the money, and he is bound by the terms of the agreement, and if, therefore, it is shown that it has not the money, the plaintiff cannot recover, in the absence of an intent to defraud having been shown.
Appeal from a judgment entered upon a verdict directed in favor of the plaintiff.
The facts appear sufficiently in the opinion.
S, Hanford (Shipman, Larocque & Choate, attorneys) for the appellant.
I. The complaint does not state facts ■sufficient to constitute a cause of action. The plaintiff’s claim is not shown to have matured. The parties have agreed distinctly that the possession of funds, and not the possibility of raising funds, should constitute the condition precedent to recovery; and the complaint shows that the defendant has not yet had possession of the funds. There is nothing in the contract obligating the defendant to “ avail itself of its resources to procure, receive and collect money,” and to carry on to any extent its corporate objects. To sustain the complaint, however, it is necessary to hold such an ■obligation implied by a contract which is not ambiguous, but which distinctly and positively declares, that before the plaintiff can claim payment of more than ten dollars per
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week, the company must have actual possession of money. not dioses in action. It will be borne in mind that he is not. suing for the weekly stipend, but for the percentage which, under the contract, he would be entitled to when the company had' the funds in its treasury, etc. The courts have-frequently recognized the binding force of tllese conditional1 promises (Scouton v. Eislord, 7 Johns. 36 ; Wakeman v. Sherman, 9 N. Y. 85 , 90; Thompson v. Brown, 1 Den.. 327 ; Wilson v. Gould, 21 Hun, 446 ).
II. There was error in denying the defendant’s motion, for non-suit, and in granting the motion to direct a verdict, and the exceptions to those rulings were well taken. There was no evidence to show that the defendant had in its-treasury, or could “ raise ” funds to meet the plaintiff’s claim,, even if the contract in suit could be so construed as to impose on the defendant any obligation to “ avail itself of its resources,” etc.
Howard R. Bayne, for the respondent.
I. The uncontradicted evidence of the plaintiff showed the defendant had money more than sufficient to pay the balance due-plaintiff.
II. The final clause in the contract, “ it being left to-our judgment to say when that time is,” if it had any operation at all, applied only to the Bridge Tunnel Company and to the time between the date of the contract and the-■consolidation (La ws 1869, Chap. 917, § 1; 1 Morawetz on Priv. Corps. § 939; R. R. Co. v. Georgia, 98 U. S. 359 . See also Shields v. Ohio, 95 U. S. 319 ).
III. But if the clause in question had a, wider application, it is in any event vain and idle. For if the company had the money to pay plaintiff, the executive committee-were bound to say so. And it would be an idle ceremony for the plaintiff to have them say so. The plaintiff’s rights could not depend upon the willful or negligent ignorance-of the committee, nor upon their mis-statement of the fact-Equity considers that as done which ought to be done.
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IV. The plaintiff having shown the defendant to be in ample fnnds to pay the balance due, and if the committee had any judgment at all in the premises, which is denied, it having to be exercised in accordance with the fact, a good; cause of action was established, the law intending every form and otherwise dispensing with an idle ceremony.
V. But plaintiff having shown complete performance on his part, and proved facts which in law excused proof of possession of money by defendant sufficient to pay his claim, thereby established an independent cause of action wherein the judgment of the executive committee had no possible operation.
VI. Where the fulfillment of a condition precedent has been prevented by the act of the defendant he is estopped from insisting upon proof by plaintiff of such fulfillment. Proof of such prevention of the fulfillment will excuse the omission to establish the fact, and the acts of excuse will be deemed equivalent to fulfillment (3 Add. on Contracts (Amer. L. S.] 798; Gallagher v. Nichols, 60 N. Y. 438 ; Risley v. Smith, 64 Id. 576, 582 ; Kingsley v. City of Brooklyn, 78 Id. 200; Peck v. U. S., 102 U. S. 64 ; Williams v. Bank of U. S., 2 Pet. 96 ).
VII. Whatever was in the contemplation of the original1 parties to the contract, to be done by the defendant, wa& adopted and confirmed by the defendant at the consolidation, on assuming the contracts and its benefits (See laws-of 1869, chap. 917, § 5).
VIII. If in any respect the complaint, because of the-plaintiff’s ignorance of the facts, was at variance with the proof, it was competent to conform the pleading to the proof. But there being no objection on- this score at the-trial, when it might have been obviated, the judgment, should not be reversed on this account now (Peck v. Goodberlett, 109 N. Y. 180 ).
IX. The objections to evidence were properly overruled,, as the evidence objected to tended to establish the allega
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tions of the complaint, and bore directly upon issues involved.

The complaint alleged the ineorpo-' ration of the defendant, the incorporation in December, 1885, of the Bridge Tunnel Company ; that said company made and entered into an agreement with the plaintiff, as follows:

“44 Wall St., New York.
“ Dec. 2nd, 1885.
“ Louis Zimmeb, Esq.,
“ Dear Sir:
“ On behalf of the Bridge Tunnel Co. we accept jour offer to obtain the majority or requisite number of ■consents of property-holders on Flatbush Avenue, between .Fourth Avenue and Fulton St. to the tunnel. We to pay therefor, at the rate of three dollars per thousand dollars ¡assessed value, for all valid consents required. We agree to ¡advance you ten (10) dollars per week up to the 15th January next, and to pay the balance which may be due for the consents after the proposed consolidation with the South Ferry & S. S. Direct Transit Co., and when the company lias the money, it being left to our judgment to say when that time is.
“ Yours truly,
“ Chas. S. Franklin*,
“ Chas. A. Saokett,
“ William F. Yah Pelt,
“ JEmeouime GommitteeP

that thereafter the plantiff in pursuance of the agreement obtained consents in writing of property owners of a total assessed value of $224,300 ; that thereafter the Bridge Tunnel Co. was duly consolidated with the South Ferry and South Side Direct Transit Co. and the Tunnel Extension Company, corporations then existing and duly organized under the laws of the State of Hew York, and that the

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defendant then and there became vested with all the privileges, rights and franchises, and assumed and agreed to pay in consideration thereof all the debts and liabilities of said several companies ; that although the plaintiff had performed the contract between himself and the Bridge Tunnel Company, the said company has failed, neglected and refused to avail itself of its resources to receive and collect money due and papable to it, whereby it has resulted that said company has not had money in its treasury to pay in full the money due to plaintiff; that said defendant having under ■the agreement of consolidation acquired the assets and assumed the liabilities was under the same obligation as the said Tunnel Company to the plaintiff, and for the same reasons the defendant has not had in its treasury the amount due to plaintiff for said consents, and the plaintiff demanded judgment for the amount remaining unpaid.

The answer of the defendants admits the agreement, the •consolidation, and that it has not got the money, but denies that there has been any neglect either on its part or on the part of the Tunnel Company, or any refusal to avail itself of its resources to receive and collect money due and payable to it, and then alleges that it was expressly stipulated and agreed that whatever might become due to the plaintiff ■should not be paid until the said company actually had the money applicable to such payment.

Upon the trial, the evidence showed that nothing was done by these companies after their consolidation because ■of the failure to obtain the consent of the board of aider-men of Brooklyn, which was necessary for them to prosecute their work. There was also introduced in evidence the articles of incorporation of these companies attached to which was an affidavit in reference to the Bridge Tunnel Company that a certain amount of stock had been subscribed and ten per cent, paid thereon, and the same affidavit in reference to the Tunnel Extension Company and also to the South Ferry ;and South Side and Direct Transit Co.

There was no evidence whatever that the defendant ever

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had any money in its treasury applicable to the payment of the plaintiff’s claim, and it is clear from the nature of the complaint and the admissions of the answer that such was the fact, and that such was the understanding of the plaintiff at the time of the commencement of his action, and that his cause of action is because of neglect in not collecting claims which he alleges to have been due to the defendant.

Under these circumstances the plaintiff cannot avail himself of a condition of affairs which contradicts the admissions-contained in the pleadings. The defendant has a right to-rely upon these admissions and to meet the cause of action only which is alleged in the pleadings. The court cannot make the pleadings conform to the evidence where by so-doing it takes out of the pleadings an allegation which has been made and which has been admitted. The defendant is entitled to that allegation and to the effect of the admission, thereof, and he cannot be deprived of it under the guise of' making the pleadings conform to the proof. Therefore, in, the making out of a cause of action not properly raised by the pleadings, the plaintiff cannot avail himself of the right of the General Term to make the pleadings conform to the-proof in the face of express admissions contained in the-pleadings to the contrary of such conformation.

The only question therefore is whether a cause of action, of neglect or refusal has been made out. We think the proof totally fails to establish any such cause of action. It appears that the corporation ran against an obstacle early in its career. The officers of the corporation were not bound to go on and continue the business of the corporation after they had met with these difficulties. The plaintiff had made a contract that he would only call for his pay when the corporation had the money, evidently meaning the money applicable to the payment of his claim. He chose to contract in that form. It was the evident understanding of the parties that his claim depended upon the corporation being in funds. There was no obligation on their part to go on with, the objects for which the corporation was organized after it

p. 389
had been developed that they were impracticable. The plaintiff, in the making of this contract in the form in which he did, ran this risk; and having ran this risk and the current of events having turned against him, he cannot claim how that although the corporation has not the money, and that it would be a fraud upon its stockholders for the corporation to attempt to continue its work with the certainty •of absolute failure, yet it was bound to do so in order that it might be put in funds out of which he might possibly collect 'his claim.

The citation of authorities to sustain the proposition that where the fulfillment of a condition precedent has been prevented by the act of the defendant, the plaintiff is relieved ■from the necessity of proving such fulfillment in no way ■applies to the case at bar. He took the risk of this corporation having the money, and if for any reason short of an actual intent to defraud it has not got the money, the plaintiff cannot recover by the very terms of his contract. It is possible that the contract was made in view of this anticipated condition of affairs that the corporation might not be able to go on with its enterprise because of its failure to •obtain the consents necessary for its success, and in that ■event it was probably anticipated that.it would not be in funds and consequently could not pay the plaintiff. He took the risk of this and he must abide by his bargain.

The judgment should be reversed, and a new trial ordered with costs to appellant to abide event.

Bartlett, J., concurred.

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