Frear v. Lewis — 170 A.D. 598

Majority

p. 598

Frank B. Frear, Respondent, v. Alfred H. Lewis, Appellant, Impleaded with Bertram E. Gendar, Defendant.

Second Department,

December 30, 1915.

Headnote

Practice — discovery — inspection of books and papers — subpoena duces tecum.

Where a partner ousted from a firm which did a fire insurance business, by his copartner who has formed a new firm and is doing business at the same place, in order to prove the extent of the good will of the old firm alleged to have been obtained by the new firm, has obtained an order for inspection, commanding defendants to permit an inspection of all the books and papers of the new firm, showing all the fire insurance business by that firm from the date on which the plaintiff was ousted, with or through the former customers of the old firm, including all books which will throw light on the business as done, and the value of the good will, the order is too broad and should be limited to the books and papers of the old firm.

Such an order is unnecessary, since the requisite books may be produced by subpoena duces tecum.

Plaintiff, as a business competitor, should not be allowed the advantage of going through the expiration book and other books of the new firm so as to gain information of the premium rates and the dates when such business will expire.

Appeal by the defendant, Alfred H. Lewis, from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the.clerk of the county of Kings on

p. 599

the 10.th day of "June, 1915, permitting an. inspection of the books and papers of the firm of Lewis & Frear and of the copartnership of Lewis & G-endar.

Andrew F. Van Thun, Jr., for the appellant.

J. Noble Hayes, for the respondent.

We have already held that on March 6, 1909, defendant Lewis forcibly ousted plaintiff from the former place of business of Lewis & Frear, so that Lewis must account for the assets and good will of that firm which he appropriated. ( 166 App. Div. 210 .) A referee has been appointed to take proof of such value.

Defendant since organized the firm of Lewis & G-endar, which carries on the fire insurance business at the same place. It is claimed that the new firm has reaped the benefit of the good will of "the firm of Lewis & Frear by means of the patronage it received from the former customers of Lewis & Frear. In order to prove the extent of such good will plaintiff has obtained an order for inspection of the books and papers of Lewis & Gendar. The order appealed from commands defendants to permit an inspection of all the books and papers of Lewis & Gendar, showing all the fire insurance business by that firm from March 6, 1909, with or through the former customers of Lewis & Frear, including the ledger, cash book, expiration book, account-current book, and all other books, which will throw light on the business done and the value of the good will of Lewis & Frear.

Clearly this is too broad. . If defendant Lewis, through his new firm of Lewis & Gendar, is now taking risks from the old customers, that fact may readily be shown upon the reference. Plaintiff as a business competitor should not be allowed the advantage of going through the expiration book and other records of the new firm, to gain information of the premium rate and the dates when such business will expire, so as the better to obtain a basis for competition. Such search through the books is needless at this time for the purposes of this reference, since by subpoena duces tecum the requisite books may be

p. 600

produced, and made the subject of inquiry in the hearings before the referee. (Cohen v. Rothschild, 162 App. Div. 611 .) The scope of the order should, therefore, be limited to the hooks and papers of the old firm of Lewis & Frear.

The order as thus limited to the books and papers of Lewis &' Frear should be affirmed, but without costs.

Jenks, P. J., Carr, Stapleton, Mills and Putnam, JJ., concurred.

Order limited in accordance with opinion per curiam, and as so modified affirmed, without costs.