Germania Savings Bank v. Village of Suspension Bridge

This action was brought to recover the interest alleged to have become due on the first days of January and July, 1888, on four coupon bonds for §500 each, known as Suspension Bridge water bonds, bearing the numbers 234 to 237, inclusive. The defense alleged in the answer is that bond No. 237 had never been issued at all; that the other bonds had never been legally issued, and that all of them, after they had been engraved and signed, were feloniously abstracted from the possession of the board of water commissioners and sold without authority) before they had a legal inception.

Upon the trial it appeared that the defendant’s board of water commissioners, acting under the authority conferred by chapter 181 of the Laws of 1875 and chapter 80 of the Laws of 1882, after duly adopting the proper resolutions to borrow money and issue bonds therefor in order to construct water works for the defendant, had caused the bonds with interest Coupons annexed to be duly engraved and had signed the

About the first of July, 1885, and after the three bonds had come back into the possession of the board, the fourth having always been in its possession, one Homan, the treasurer of the board, sold the four bonds at a discount of two per cent to Charles E. Clark, of Buffalo. Ho part of the proceeds of the sale was received by or came into the possession of the board or the defendants. In thus selling the bonds Homan neither acted nor claimed to act as treasurer of the board, but represented that he was acting for a third party, who owned them. Subsequently Mr. Clark sold them to a broker in Hew York, who in turn sold them to the plaintiff. The interest was paid upon them until July 1, 1887, when default was made and none has since been paid. Ho interest was paid by authority of the board, and it does not appear by whom any payment was made, although it is supposed to have been through Homan in order to prevent discovery.

The trial judge, after finding that said bonds were never delivered or intended to be delivered by the board for sale, and that the plaintiff was a bona fide purchaser, directed judgment for the defendant, dismissing the complaint upon the merits, with costs.

Upon appeal to the General Term judgment was. affirmed and formal judgment of affirmance was duly entered on the 17th of January, 1894. As the amount demanded in the complaint was less than $500, no appeal could be taken to the Court of Appeals, as the law then stood, without permission of the General Term. (Code Civ. Pro. § 191; L. 1871, ch.

On the 27th of May, 1895, an act was passed by the legislature entitled “ for the protection of tona fide purchasers and holders of coupon bonds and of municipal corporations against misfeasance, malfeasance or negligence of public officers.” (L. 1895, ch. 792.) It authorizes any tona fide holder of negotiable bonds, put in circulation by means of the misfeasance, malfeasance or negligence of any public officer, whose right of recovery thereupon “has been or shall be determined by the judgment of a court of competent jurisdiction,” to begin an action against such officer for the recovery of all damages which the holder “ shall have suffered because of the misfeasance, malfeasance or negligence of such public officer.”

A similar right of action is given to any municipal corporation “ which has been or shall be compelled to pay any negotiable bond, or any coupon originally attached to such bond, by the judgment of a court of competent jurisdiction, because ■of” such misfeasance, etc. After these provisions, section 4 declares that “ in any suit or action upon any coupon or coupons hereinbefore mentioned, or upon any bonds hereinbefore mentioned, or to recover any damages hereinbefore mentioned, any party to such action shall have and is hereby granted a right of appeal, to the General Term or Appellate Division of .the Supreme Court from the judgment of any trial court, or to the Court of Appeals from any judgment of the General Term or of the Appellate Division of the Supreme Court, although the amount in controversy in such action has been or may be, less than $500. Appeals from any inferior court to any appellate court, including an appeal to the Court of Appeals although the amount in controversy may be less than $500, from any judgment in any suit or action to recover against any municipal corporation or civil division of this state

Acting under this statute, Mr. Clark, the purchaser of the bonds in question, on the 8th of July, 1895 gave the security required and served a notice of appeal to this court from the judgment of the General Term, entered on the 17th of January, 1894. He stated in the notice of appeal that he brought the same in the name of the plaintiff as a privy bound by the judgment appealed from, written notice of the entry of the same having been served upon him by the plaintiff on the 17th of June, 1895, pursuant to said act for the protection of bona fide purchasers.

The respondent now moves to dismiss the appeal upon the ground that we have no jurisdiction to hear it, because the statute under which it was taken should not be so construed as to operate retrospectively and take away a vested right, and that if so construed it is unconstitutional, because it deprives the defendant of property without due process of law.

If the act under consideration does not operate retrospectively, the appeal is not regularly before us and should be dismissed. If it does act retrospectively it may deprive the defendant of a vested right in property, and to that extent is forbidden by the Constitution. (Const, art. 1, § 6.) The legislature has control of remedies so far as they affect existing

A judgment is a contract which is subject to interference by the courts so long as the right of appeal therefrom exists, but when the time within which an appeal may be brought has expired, it ripens into an unchangeable contract and becomes property, which can be disposed of or affected only by the act of the owner, or through the power of eminent domain. It is, then, beyond the reach of legislation affecting the remedy, because it has become an absolute right which cannot be impaired by statute. Bemedies may be modified even as to pending actions, but no action can be regarded as pending when it has expanded into a judgment and the time to appeal has expired, or the only appeal allowed by law has been taken and decided. It is. then no longer depending, because there is nothing further that can be done to affect the rights of the parties. As a claim, against which the Statute of Limitations has fully run, cannot be revived by legislation, so a right to appeal from a judgment, which has passed through all the appellate courts that have jurisdiction to hear

We do not think, however, that the legislature intended to give a new right of appeal to a party, or a privy to a party, who had carried his action through all the courts open to him at the time, and had been finally defeated, so that his action was not pending, but was irrevocably determined when the statute in question was passed. It is the duty of courts to assume that the legislature did not intend to violate the Constitution, and to so construe this statute as to bring it within ■constitutional limitations, if possible. The presumption is that such a retrospective operation as to affect rights already accrued was not intended, unless the words used admit of no other reasonable conclusion. As was said by Judge Earl in ■an important case, “ it is always to be presumed that a law was intended, as is its legitimate office, to furnish- a rule of future action to be applied to cases arising subsequent to its enactment. A law is never to have retroactive effect unless its express letter or clearly manifested intention requires that it should have such effect. If all its language can be satisfie4 hy giving it prospective operation, it should have such oper- . ation only.’’ (N. Y. & Oswego M. R. R. CVo. v. Van Horn, supra, citing Dash v. Van Kleeck, 7 J. R. 499 ; Berley v. Rampacher, 5 Duer, 183 ; Sayre v. Wisner, 8 Wend. 662 ;

The words used in the statute do not show an unmistakable intention on the part of the legislature to reach bacic, without limit, and give a right of appeal in all actions brought upon municipal bonds, even if they had been quieted by final judgments rendered years and years ago, without further right of appeal. That would not be a reasonable construction in view of the presumption already referred to. The language of the. statute warrants the conclusion that it was the intention of the legislature to simply grant the right of another appeal in actions pending when it took effect, or, in other words, to enlarge an existing remedy. The reference to the past, so far-as the point under consideration is concerned, is satisfied when limjted to judgments from which an appeal to some court could still have been taken according to the law in force when the statute took effect. As to such judgments, the subject was within the control of the legislature, for so long as a right to appeal still existed, that right could be extended not only in point of time, but of jurisdiction also.

We think the act applies to those actions only in which the right of appeal had not been exhausted when it was passed, and hence that the motion to dismiss should be granted, with costs.

All concur, except O’Brien, J., not voting.

Appeal dismissed.