Keene v. Newark Watch Case Manufacturing Co. — 80 N.Y.S. 859

Majority

p. 859

KEENE v. NEWARK WATCH CASE MFG. CO.

(Supreme Court, Appellate Division, First Department.

March 6, 1903.)

Headnote

1. Bonds — Suretyship—Actions—Complaint.

A complaint alleged that defendant executed a bond to secure payment for gold delivered under a contract which was to continue from May 8, 1901, to January 1, 1902, and that defendant agreed to be answerable to plaintiff in damages at the termination of the contract for loss of gold in excess of a certain amount, and that on September 1, 1901, an accounting was had, which disclosed a shortage, which plaintiff demanded from the principal, but which he refused to pay, and that the loss has not yet been made good. Held that, the action not having been brought until after January 1, 1902, the complaint was not demurrable as to the sureties as alleging a termination of the contract on September 1, 1901.

8. Same — Commencement op Suit — Date—Determination.

Where, in an action on a bond, the date of the commencement of the action became material in determining the sufficiency of. the complaint, it was improper for the court to base its determination • thereof on a concession made on the argument of the demurrer, but the court should have taken judicial notice that the action was not commenced before the date of the summons.

Appeal from Special Term, New York county.

Action by Charles J. Keene against the Newark Watch Case Manufacturing Company. From an interlocutory judgment overruling a demurrer to the amended complaint, defendant appeals. Affirmed.

p. 860

Argued before VAN BRUNT, P. J., and HATCH, McLAUGHLIN, INGRAHAM, and LAUGHLIN, JJ.

Isaac L. Miller, for appellant.

A. Judson Hyatt, for respondent.

The demurrer is upon the ground that the complaint fails to state facts sufficient to constitute a cause of action. The plaintiff had a contract with the Camm Watch Case Company, by which he was to deliver gold to it for manufacture into "watch cases, and it agreed to account to him at all reasonable times for the gold thus furnished, and to satisfy any obligation that might arise, during the existence of the agreement or at its termination, on account of any loss in gold in handling and using the same in the execution'of the contract. The contract, by its express terms, was to continue from the 8th day of May, 1901, until the ist day of January, 1902. The action is upon a bond by which the defendant agreed to be answerable to him in damages at the termination of said contract “for any loss of gold in an amount in excess of one-half of one per centum of all gold furnished thereunder.” The plaintiff alleged that he delivered to the Camm Watch Case Company, pursuant to said contract, gold of the value of $49,000; that on the ist day of September, 1901, an accounting was had, as authorized by the contract, which disclosed a shortage of the gold so furnished of the value of $5,600.15; that he demanded that the Camm Watch Case-Company make good the deficiency, or pay the cash equivalent, and it has done neither; that the defendant has been apprised of the loss, and requested to make the same good, but has failed to do so, and the loss has not yet been made good. Judgment is demanded for the amount for which defendant is liable under the bond.

If, as contended by the appellant, it be the legal effect of the allegation of the complaint that the contract, which was to continue until1 the ist day of January, 1902, was terminated on the ist day of September, 1901, it by no means follows that the defendant is not liable. If that were the effect of the allegation, the inference would be that the contract was so terminated on account of the failure of the Camm Watch Case Company to make good the deficiency of gold found on the acounting at that time. It being sufficiently alleged that the deficiency continued down to the commencement of the action, the defendant unquestionably would be liable, provided the action were not commenced before the ist day of January, 1902, at which time the contract was, in any event, to expire. It is unnecessary to decide whether an earlier termination of the contract would render the defendant liable before the ist day of January, 1902.

The learned justice at Special Term, in sustaining the sufficiency of the complaint, wrote an opinion fully and ably considering every point urged in support of the demurrer. We would affirm on that opinion, were it not for the fact that it fixes the date of the commencement of the action, which became important on the determination of the demurrer, by a concession made upon the argument of the demurrer. The sufficiency of a pleading to which a demurrer is interposed, should

p. 861

not be determined on a concession which forms no part of the record, and is not incorporated in the pleading by an appropriate amendment. By the express provisions of section 418 of the Code of Civil Procedure it is declared that “the summons is deemed the mandate of the ■court.” The summons is dated March 28, 1902. We think the trial court could have taken judicial notice that the action was not commenced before the date of the summons, and that would have led to the same result.

It follows, therefore, that the interlocutory judgment should be affirmed, with costs, but with leave to the defendant to withdraw its demurrer and plead over on paying the costs of the demurrer and of the appeal. , All concur.