MacColl v. American Union Life Ins. — 35 N.Y.S. 364

Majority

p. 364

(89 Hun, 490.)

MacCOLL v. AMERICAN UNION LIFE INS. CO. OF NEW YORK.

(Supreme Court, General Term, First Department.

October 18, 1895.)

Headnote

1. Pleading—Answer—Irrelevancy and Redundancy.

The complaint in an action to recover money paid to defendant on account of an alleged stock subscription stated that plaintiff notified defendant of his refusal to take stock, whereupon defendant sold the stock to others, and thereby voluntarily abandoned plaintiff’s subscription. The answer alleged that the payment was not on account of the par value of the stock, but was pursuant to an agreement to pay such amount to be used for the expenses of organizing the company, and that the payment was received and used for that purpose. Held, that such allegation in the answer was neither irrelevant nor redundant.

3. Same—Sham Answer.

Nor is such answer sham, the real issue between the parties being as to the terms under which the payment was made.

3. Same—Inconsistency.

In New York a defendant may plead inconsistent defenses.

Appeal from special term, New York county.

Action by Angus F. MacColl against the American Union Life Insurance Company of New York to recover money alleged to have been paid by plaintiff to defendant on account of stock subscription.

p. 365

From an order denying a motion to strike out the fifth paragraph of the answer for irrelevancy, redundancy, and inconsistency, and the entire answer as sham, plaintiff appeals. Affirmed.

Argued before VAN BRUNT, P. J., and O’BRIEN and FOLLETT, JJ.

Gideon T. Chappell, for appellant.

Wilson & Bennett, for respondent.

The action is brought to recover the sum of $300, paid to defendant on account of an alleged stock subscription of $10,-000. Among other things, the complaint alleges that on May 3, 189Í, plaintiff notified defendant of his refusal to take stock, and that thereafter defendant parted with its entire stock to others, and thereby voluntarily abandoned plaintiff’s subscription, and released him therefrom; and that the defendant was capitalized at $500,000, which was paid up in cash prior to the date of its organization. The defendant, after admitting the organization of the company, the subscription by plaintiff to the stock, and his refusal to take it, then denies, except as so admitted, each and every allegation of the complaint, and by way of further answer alleges that the $300 sought to be recovered was not paid on account of the par value of the stock, but pursuant to an agreement whereby plaintiff, with other promoters of the company, agreed to pay on the call of the treasurer a sum equal to 3 per cent, on account of his subscription to said capital stock, which was to be used as a promoters’ fund, to meet the expenses of the organization of the company, and that the same was received and used for the purposes designated. We regard this motion made on these pleadings as entirely unnecessary, and therefore properly denied by the special term. The matter set up in the answer is neither irrelevant nor redundant, and, even though it might be construed as inconsistent, there is nothing in our practice which would prevent a person setting up inconsistent defenses, provided they are properly pleaded.

Nor do we think that the answer can be regarded as sham. The real issue between the parties—as to the terms under which the $300 was paid—seems to be as to whether it was on account of part subscription to the stock or as a subscription to be used for the purpose of paying the expenses of organization, in addition to the par value of the stock. While there is in the prospectus issued by the president some warrant for the view taken by the plaintiff, this is fully offset by the agreements signed by the plaintiff, in one of which he agrees to pay 3 per cent, to meet the expenses of organization, and by the other agrees to pay the par value of the stock. The question thus presented is not to be disposed of on a motion, nor can it be said that a defense thus fortified is sham.

As already said, we think the order below was right, and should be affirmed, with $10 costs and disbursements.