Potter v. Rossiter — 109 A.D. 737

Majority

p. 737

Alexander Potter and William B. Tuteur, Appellants, v. Clinton L. Rossiter, Toluca Electric Light and Power Company and Others, Respondents.

(No. 4.)

First Department,

December, 1905.

Headnote

Stipulation—when ‘enforcible by order—when assignors may compel enforcement of stipulation made for benefit of their assignee.

The court has power, on a motion therefor, to enforce by order the observance of an undisputed stipulation made by parties in an action.

Where, however, the existence or validity of such stipulation depends upon voluminous and disputed evidence, the proper remedy to enforce it is by action!

p. 738

When the contract of the. defendant with the plaintiffs for supplying- electric power provided that the plaintiffs could assign the same to a person- to be approved by the defendant, and when, in an action on such contract, such assignee has withdrawn from the action as a party plaintiff on a, stipulation of the defendant that she be approved as assignee, the remaining plaintiffs being interested in the recognition by the defendant of their assignee may. compel, by motion, the passage of a resolution by the' defendant recognizing such assignee.' ^ ■

' The stipulation must be carried out as made by defendant and without limitations not Contained therein as to the assignee’s right in her .turn to assign.

Írgbaham, J7, dissented, with memorandum.

Appeal by the plaintiffs, Alexander Potter an4 another, from an • order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 18th day of October, 1905. . ,

J. Aspinwall Hodge, for the appellants.

Henry W. Goodrich, for the respondents.

The record is very meagre, but from it fairly appears the fact that the defendant Eossiter entered into a contract with .-the plaintiffs, among other things, to' supply to them through the defendant Toluca Electric Light arid Power Company a certain quantity of electrical power for the period of twenty years, at a specific price-with the privilege on the_part of plaintiffs to assign such contract . for power to an assignee to be approved either by Eossiter or the company; that plaintiffs assigned such contract to one Florence . D. Potter; that dissensions arose with- respect to the contract between the parties and the approval .of. Florence D. Potter as assignee of that portion of the contract relating to the purchase of power, which resulted in-this action, in which Florence D. Potter originally joined,as plaintiff, undoubtedly for thq purpose of compelling approval and recognition of her as such assignee; that' after the complaint had been served and tlié defendants had duly appeared by attorney, a stipulation was entered into which provided for the dóing of certain things beneficial to both parties, and amongst them the following:

“(2) The defendant Toluca Electric Light'and Power Company

p. 739

shall pass a resolution within sixty days, substantially in the following form:

“ ‘ Resolved, that Florence D. Potter is the assignee approved by this company under the Ninth Clause of the contract between Alexander Potter and William B. Tuteur and Clinton L. Eossiter, dated November 29, 1901.’ ”

The stipulation further provided that Florence D. Potter should retire as a party plaintiff from the litigation, without costs, and that either party might enter an order to that effect, and that the summons and complaint might be amended in conformity therewith. This was done and the action proceeded in the name of the present plaintiffs.

Instead of passing the resolution provided for in the stipulation, the defendant corporation waited nearly two years and then passed a resolution approving her as assignee, adding to it, however, as follows : “ This approval is limited to said Mrs. Florence D. Potter and carries with it no rights of assignment.” The plaintiffs repudiated this resolution as not in accordance with the stipulation, and made a motion to compel the passage of a resolution as agreed, without the limitation attached. This the court denied and the plaintiffs appealed.

The plaintiffs have sufficient interest in the passage of the resolution to enable them to make this motion. They are the holders of the contract entered into between Eossiter and themselves and Florence D. Potter is the assignee through them, of that part of the contract relating to the purchase of electrical power. The stipulation was entered into in the action in which they were parties and presumably they still have an interest in obtaining a proper recognition of the person to whom they assigned. Prima facie, if the consideration for the assignment failed they wofild be liable to return what they had received. They, therefore, could make the motion notwithstanding Florence D. Potter had retired as a party to the action.

The court had power to compel performance of the stipulation, and we think it should have done so. Parties to actions may make stipulations for the government of their conduct, or the control of their rights, or the conduct of a litigation, which, unless they be unreasonable, or against good morals, or sound public policy, not

Dissent

p. 740

only bind them, but are enforcible by the courts.- (Matter of New York, Lackawanna & W. R. R. Co., 98 N. Y. 453 ; Dubue v. Lazell, Dailey & Co., 182 id. 482 .) Where the existence or validity of a stipulation is dependent iipon voluminous evidence, an action for its enforcement may be the proper remedy; but the court always has the power to enforce in a summary way, by motion, the observance of an undisputed and proper, stipulation entered into by the parties to an action. • (Mutual Life Ins. Co. v. O'Donnell, 146 N. Y. 275 ; Valentine v. Gentral National Bank, 10 Abb. N. C., 190 ; Kelsey v. Sargent, 2 N. Y. St. Repr. 669 .)

We- see no reason why the defendant corporation should not bpcompelled to carry out its agreement and pass the resolution which. it stipulated .it would.' It may be that Florence I). Potter has no • right to assign the contract; but even that fact would not authorize ,the defendant to attach a limitation to its approval of her. If a limitation was proper ..it should have been considered when the. defendant made its stipulation. Whether it is proper of not, the parties are entitled to the passage of the resolution which it was agreed should1 be passed, without qualification.

The order is reversed, with ten dollars costs and disbursements, and the motion granted, with ten dollars costs. .

O’Brien, P. J., and Clarke, J., concurred; Patterson and Ingraham, JJ., dissented.

If the court .had power to grant this motion I would concur, with Mr. Justice Houghton. I think it. olear that Mrs. Potter is entitled to have the resolution passed as specified in the stipulation; but as-she is no longer a party to the action, and interlocutory judgment has .been- entered, I think that right can only be enforced by an independent action.

Order reversed, with ten dollars costs and disbursements; and motion granted, with ten dollars costs.

Cases cited

Mutual Life Insurance v. O'Donnell 146 N. Y. 275 N.Y. 1895-05-28 p. 740