Hyatt v. Mark — 18 N.Y. St. Rep. 411

Majority

p. 411

Elizabeth A. L. Hyatt, App’lt and Resp’t, v. Jacob Mark et al., Resp’ts and App’lts.

(New York Superior Court, General Term,

Filed May 7, 1888.)

Headnote

1. Contract—Construction op—Documentary aid aliunde.

A patent for illuminated basements and basement extensions, etc., was issued to the plaintiff in 1867, and re-issued August 6, 1878. By an agreement the plaintiff agreed to and did license among others, the defendants, to manufacture and sell within territorial limits the articles covered by

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these patents. This action was brought to procure among other things an accounting under the agreement. Meld- that although an area was not part of a basement or of a basement extension, and certain considerations drawn from the patents in evidence by themselves have lead to the conclusion _ that a basement extension, as used in the contract, meant something different from an area, yet the patents taken together warranting the conclusion that the contract meant, among other things, such a basement extension as would result from an area being covered by the illuminating work, the defendants should be charged for illuminating work used for covering areas.

2. Same—What included within terms of.

Reid, that the defendants were properly held liable for steps, risers and platforms forming wholly or partly, “an illuminating roof ” over areas, these being within the terms of the contract if the phrase “ basement extension ” comprised areas.

3. Accounting — Objections to account — Effect of filing—When OTHERS UPON THAN THOSE FORMALLY FILED MAY BE CONSIDERED.

A formal filing of objections to an account implies that the accounting party need not prepare to meet any other objection, but the court has power to allow other objections to be made giving the accounting party an opportunity to meet them.

4. Same—Burden of proof—Circumstances under which it does not REST THE ACCOUNTING PARTY.

The contract allowed the defendants to make and sell separate tiles without payment of royalties, if they were not “ made and sent away by the defendants to be used for the purpose of making illuminated basements and basement extensions." Meld, that upon an accounting under the contract, it was not incumbent on the defendants to prove that separate tiles sold by them were not used by the purchasers for the excepted purposes.

Each party appeals from a judgment entered upon a report of a referee.

The facts are sufficiently stated in the opinion

George W. Van Slyck, attorney, and B. B. McMasters, of counsel for pl’ff; Edward D. McCarthy, for def’t.

The obligation of the defendants to account to plaintiff under the contract between them, were held to exist in Hyatt v. Ingalls (49 Super. Ct., 375). It was further held that the court had jurisdiction of the action. Every question that related to the obligation to account, was determined by the court on the appeal to the general term, and now only such exceptions as concern the accounting are to be considered.

The contract bound the defendants to pay thirty' cents per square foot “of illuminating work made and sent away by the defendants to be used for the purpose of making illuminated basement and basement extensions.”

The defendants’ counsel excepted to the referee ruling that the defendants should be charged for “illuminating work ’ ’ used for covering areas. The claim is that areas were not, within the intention of the parties, basement extensions. What was according to the contract a basement extension, was a question of fact. It is true that an area

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per se, is not part of a basement or of a basement extension, and there are considerations drawn from the patents in evidence, that by themselves would lead to the conclusion that a basement extension, as used in the contract, meant something different from an area. Yet taking all there is in the patents together, I think the referee was right in his conclusion that the contract meant among other things, such a basement extension as would result from an area being covered by the “ illuminating work.”

The referee’s findings as to the defendants’ liability for steps, risers and platforms, forming wholly or partly “an illuminating roof ” over areas, should be sustained. They were within the terms of the contract if the phrase “ basement extension” comprises areas. The exception to the finding was general. There is no suggestion that the finding alluded to contained a charge for “illuminating work” not used in connection with “illuminating covering ” of areas.

The learned counsel for defendants urges that the referee found for matters not contained in the first 115 objections made by plaintiff to the account filed by the defendants. Whatever may be the usual practice, the referee had the power to allow in any form that did not work injustice to the defendants, an objection to the account presented by defendants, whether or not a statement of objections had been previously made. A formal filing of objections implies that the accounting party need not prepare to meet any other objection. But the court has power to allow other objections to be made giving the accounting party opportunity to meet them.

I am of opinion that on the defendants’ appeal the judgment should be affirmed with costs.

On the plaintiff’s appeal, it is urged that the referee should have charged the defendants “for all tiles adapted for covering basement extensions and manufactured and sold by them, or manufactured and used by them, Which they have not shown were actually used for purposes other than basement extensions or how such material was to be used.”

In other words, the plaintiff claims that the burden of proof was upon the defendants to show that the tiles that they sold and which might be used for “illuminating basements and basement extensions ” were not then used, and that if this were not proved, the defendants were to be charged with the royalties according to the contract.

The “illuminating work” in question was separate tiles, which were capable of various uses besides that of illuminating basement extensions. The tiles as made and sold

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by the defendants, did not indicate any special use to which they were to be given.

Not only did the contract in action, allow the defendants to make and sell such separate tiles without payment of royalties, if they were not “made and sent away by the defendants to be used for the purpose of making illuminated basements and basement extensions;” the patents themselves made no claim for the separate tiles, apart from' their combination for certain uses. This right of the defendants to make and sell was not incumbered by the contract in any of its provisions. It would bean unusual limitation of the right to sell and of the benefit thereof, to require that the defendants should not only inquire of their customers as to the use to which the tiles were to be put, but should investigate the course which the tiles actually took after they were sold. The ruling of the referee in this-respect was correct.

I am of opinion that the referee was right in his action: as to work done by defendants in glazing tile.

Judgment affirmed as to each party with costs.

O’Gorman, J., concurs.