Majority
p. 78THE CUMBERLAND COAL AND IRON COMPANY a. THE HOFFMAN STEAM COAL COMPANY. Supreme Court, First District; General Term, November, 1862.
Headnote
J drisdiction.—Injunction.—Service.—Costs.—Damages.Want of jurisdiction in the court over the subject-matter of the action does not deprive the defendant of the right to damages on the undertaking given on the issuing of an injunction in the action.[1]
A defendant who obeys an injunction, though never served therewith, is entitled after judgment in his favor to claim the damages provided for in the undertak -f— ing given to procure such injunction.
Appeal from an order of reference.
This action was brought by the Cumberland Coal and Iron Company against Allen M. Sherman, William B. Dean, and the Hoffman Steam Coal Company for the purpose of setting aside a certain conveyance of lands of the plaintiff, situated in - Maryland, and a certain transportation-contract made by the plaintiff, to and with the defendants Sherman and Dean, while Sherman was one of the directors of the plaintiff, which convey- , anee and contract were alleged in the complaint to have been procured by fraud. The Hoffman Steam Coal Company was a corporation created by statute of Maryland, and was made a party by reason of a conveyance and transfer of the said lands and the transportation-contract to it by Sherman and Dean.
p. 79I. To authorize the granting of the order of reference appealed from, it should have appeared, 1. That there was an undertaking containing a stipulation that the damages might be ascertained by a reference. (Garcie a. Sheldon, 3 Barb., 232 .) 2. That the injunction had been served upon the party applying for the order of reference. 3. That there had been a final decision by this court, at the termination of the cause by judgment, that the plaintiff was not entitled to
A temporary order of injunction was made restraining the defendants from interfering with the lands in question and from disposing of the transportation-contract, with an order to show cause why such injunction should not be continued. The order was served on Sherman and Dean, who appeared in the action; and the summons and complaint, with a copy of the injunction-order, were served at Hew York city on S. B. Postley, the president of the Hoffman Steam Coal .Company. The last-named defendant did not appear, but moved to set aside the service of it, because, 1. The company had not been lawfully . served with the summons and complaint. 2. The company was ' not a resident of this State, and the cause of action did not arise, and the subject-matter of the action was not situated in this State. 3. The company had no property within this State.
" On this motion an order was made setting aside and absolutely vacating the service of the summons, complaint, and injunction, as against the Hoffman Steam Coal Company, on the ground that the service was void and of no effect, not being within the provisions of section 134 of the Code as it then stood. The plaintiff appealed to the general term, where this order was affirmed: no appeal.was taken from this affirmance. The motion for the continuance of the injunction against Sherman and Dean was granted, and those defendants appealed to the general term, where the order was affirmed.
The action was still pending and undetermined, except as above stated, when the Hoffman Steam Coal Company moved for a reference to ascertain their damages, by reason of the injunction : it appeared that the company had strictly obeyed the injunction from the time of service till such service was set aside. Hr. Justice Barnard granted the motion, and plaintiff* took the present appeal.
Charles A. Rapallo, for the appellant.
p. 80the injunction when he applied for it. (Shearman a. N. Y. Central Mills, 11 How. Pr., 269 .) II. The moving papers are defective in not showing that there was an undertaking containing the requisite stipulation. They do not allege or show that there was any undertaking whatever. The general reference in the notice of motion to “ the papers in the case” is insufficient to authorize the reading of any paper except those served. III. It appeared by the papers read on the motion that there was no service on the Hoffman Company. The delivery of the injunction to Postley was decided by this court to be no service on the corporation, and it was further decided that under the circumstances then existing there could be no service on the Hoffman Company. (See this case, 8 Abbotts' Pr., 243; affirmed, 30 Barb., 159 .) Under section 134 of the Code, as since amended, the service could be made now, the action being still pending. IV". There has been no final decision by this court that the plaintiff was not entitled to the injunction. The Hoffman Company, by refusing to appear, have declined to submit that question to this court. If the question had been submitted to this court, the injunction would without doubt have been sustained, as it was sustained against the other defendants. (See decision of Davies, J., 30 Barb., 553 .) V. The order of Judge Sutherland, setting aside the service, is not a final decision, or any decision as to the plaintiff’s right to the injunction. . The right to the injunction and the power to make it effectual by service, are very different things. The final decision required, is the final judgment of the court after the trial of the cause upon its merits. There has been no such trial; an order setting aside the injunction on motion before the trial, would not be sufficient to warrant an order of reference. ( 11 How. Pr., 269 ; Weeks a. Southwick, 12 Ib., 170.) I. The order is not appealable. II. The decision of the general term on plaintiff’s appeal was a judgment in favor of the present respondent.
Luther R. Marsh, for the respondent.
The want of jurisdiction of the court over the subject-matter of the action, did not pre
Dissent
p. 81
vent the defendants from recovering costs on the dismissal of the complaint, nor does it deprive the defendants of the right to damages, on the undertaking given on the issuing of the injunction when it was dissolved. The court had sufficient jurisdiction over the parties to commence the action, although there, was none over the subject-matter, and in such a case I can see no reason why the defendants should not have the benefit of the undertaking filed for that purpose. The plaintiff is estopped from denying jurisdiction. ( 2 Sandf., 81 .) The only question is whether a defendant who obeys an injunction before the process is sei’ved, may have such relief. I think he may if he obeys the injunction. It has been held that it is the duty of the defendant to obey an injunction if he knows it has been granted, although it has not been served, and if he disobeys it he would be liable to an attachment. The injunction is granted before service of process often, and the undertaking when filed in such a case is for the benefit of all the defendants, whether served or not, that are enjoined.
The order should be affirmed, with costs.
Barnard, J., concurred.
I dissent. The Hoffman Company not having appeared in the action is not entitled to any costs. I think the Hoffman Company cannot, without service of process, volunteer to come into court, so as to claim the benefit of the undertaking, without full appearance in the action, unless there had been service of the injunction. The court were also without jurisdiction of the parties or of the action so far as the Hoffman Company was concerned. This defendant is a foreign corporation. The plaintiff does not reside in this State, and the cause of action did not originate here. (Code, § 427.) The injunction was void; not merely voidable. And the court were without jurisdiction to make the order of reference, or any other order, affecting the Hoffman Company. (People a. Sturtevant, 9> m r., 263.)