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Green v. Easton

26 N.Y.S. 553 Court N.Y. Gen. Term Decision date 1893-12-06 English

Delivered by PUTNAM, J.

Contents

Majority

p. 553
GREEN v. EASTON.
(Supreme Court, General Term, Third Department.
December 6, 1893.)

Headnote

1. CORPORATIONS—LIABILITY OP TRUSTEES—FAILURE TO PUBLISH STATEMENT.
An unliquidated claim for a breach of contract of employment is a “debt,” within Laws 1848, c. 40, § 12, providing that if any manufacturing company shall fail to make and publish an annual report stating the amount of its existing “debts,” the trustees shall be jointly and severally liable for such “debts.”
2. Action against Trustee—Complaint.
Where the complaint in an action against.a trustee for a corporate debt asks judgment for $100, plaintiff can only recover $100 while the complaint remains unamended, though defendant admits that the debt is for a larger amount.
8. Same—Costs.
In an action against the trustees for a corporate debt for which plaintiff obtained judgment against the corporation, plaintiff cannot recover costs awarded him by such judgment.
Appeal from special term, Washington county.
Action by H. Cooley Green against Daniel C. Easton. From a judgment in plaintiff’s favor, defendant appeals.
Modified.
p. 554
Argued before MAYHAM, P. J., and PUTNAM and HERRICK, JJ.
Potter & Lillie, for appellant.
O. F. & R. R. Davis, for respondent.

Plaintiff brought this action against defendant as a trustee of the Putnam Creamery Association, a corporation formed, under chapter 40, Laws 1848, and acts amendatory thereof, to recover the penalty imposed by section 12 of said act for the failure of said corporation to file the report required by the said section. Plaintiff alleges that in the spring of 1890 the said corporation employed him to work for the ensuing season at the price of $50 per month, and that, after giving him employment until August 1st, neglected thereafter to continue said employment for the balance of the season, being until about November 1st. Plaintiff claims-to recover damages resulting from such breach of contract by the company. That afterwards, on or about January 1, 1891, plaintiff commenced an action against defendant on account of said breach of contract, and obtained judgment on October 6, 1891, for $100 damages and $81.50 costs. The plaintiff further alleges that defendant did not within 20 days from January 1, 1891, or of any year from the time of the incorporation of said company, make or file the report required by section 12, supra. The case was tried at special term, and plaintiff obtained judgment for $150 damages, with costs.

It is urged by defendant that the claim for damages set out in the complaint is not a debt, within the meaning of section 12 of the Laws of 1848.[1] That such claim for damages constitutes a liability, but not a debt. While it is true that a claim for damages arising from a tortious act cannot be deemed a debt, (Esmond v. Bullard, 16 Hun, 65 ,) we are of opinion that an unliquidated claim arising, out of a breach of contract of employment is a debt, within the meaning of section 12 of the manufacturing act. At the time the-corporation failed to file the annual report, some sum was due plaintiff by reason of the failure of the company to fulfill its contract, of employment. The amount was unliquidated, but was in fact due. We think that under the act there may be a debt unliquidated as to the amount. At the time in question the corporation*, owed plaintiff, on account of said failure to perform its contract, an. unliquidated sum; in other words, was indebted to him. This-indebtedness can be properly deemed a debt within the meaning, of' section 12, supra. See Insurance Co. v. Meeker, 37 N. J. Law, 300 , 301; Frazer v. Tunis, 1 Bin. 254 -262; Foundery v. Hovey, 21 Pick.. 417 , 454, 455; Haynes v. Brown, 36 N.

1 Laws 1848, c. 40, § 12, provides that any manufacturing company shall within-20 days from the 1st day of January in each year after the expiration of a year from the time of its incorporation make a report stating the amount of its existing debts, which shall be published in some newspaper of the town in which the company’s business is carried on; and makes the trustees of such company jointly and severally liable for such debts on failure of the company, to make such report

p. 555
We have examined the cases cited by appellant,, and think that none of them conflict with the views above stated. The construction of the statute above given is the only reasonable one. No good reason is apparent why an action' should be maintained against a trustee of a corporation for failure to file its annual report by a creditor having a liquidated obligation in preference to one having an • unliquidated claim. We think, however, that the recovery should have been limited to $100 damages. The complaint sets out the fact that an action was commenced against the corporation to recover for the claim in suit, and that, issue having been joined therein, he recovered $100 damages and $81.50 costs. The plaintiff apparently intended to set up a cause of action for the amount so recovered,—the damages and costs. It is settled that a recovery cannot be had against the defendant for costs of an action against a corporation. Rorke v. Thomas, 56 N. Y. 559 , 565. It was not necessary for the plaintiff to obtain a judgment against the company before proceeding against the trustee. Miller v. White, 50 N. Y. 137 . The complaint alleges a claim for damages against the corporation which had been liquidated by the judgment at $100 as the claim in suit upon which, together with the costs, the plaintiff claimed judgment. As we have seen, he cannot recover judgment against the defendant for the said costs. His claim, therefore, should be limited to the amount of the damages which he sets out in his complaint was recovered against the corporation. The admission by the defendant on the trial that plaintiff’s damages for the breach of contract alleged was $150 is of no avail while the complaint remained unamended. Defendant, while admitting the fact that plaintiff’s damages were $150, objected to the evidence as irrelevant, and not within the issue. It follows, therefore, that under a complaint which in fact alleges $100 damages, the plaintiff could not properly recover $150 without an amendment of the complaint. Were the pleading otherwise, however, we are of opinion that plaintiff, having brought an action against the corporation to recover his claim, and issue having been made therein, and he recovering only $100, afterwards bringing an action against a trustee for a failure of the corporation to file the annual report, can only recover judgment against the trustee for the amount for which he recovered judgment against the corporation. The judgment against the company should be deemed binding on the plaintiff. It liquidates his claim. The judgment appealed from should be modified by reducing the amount $50. If the plaintiff, within 10 days after the order herein shall be served upon him, stipulates to such reduction, the judgment shall be accordingly modified, and, as modified, affirmed, without costs to either party. Should the plaintiff fail to file such stipulation, judgment is reversed, and a new trial granted, with costs to abide the event. All concur.

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