Mayor, Aldermen & Commonalty of New York v. Brady — 25 N.Y. St. Rep. 106

Majority

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The Mayor, Aldermen and Commonalty of the City of New York, Pl’ffs and App’lts, v. John Brady, Bernard Brady, and Laflin & Rand Powder Company, and Henry Judson Morris, Def’ts and Resp’ts.

(New York Superior Court, General Term,

Filed May 6, 1889.)

Headnote

1. Judgment—Complaint in action to set aside—Sufficiency of.

Where an action is brought to set aside judgments at law in suits that have been tried, on the ground of fraud, and that the fraud was discovered, since the judgments, from evidence also since then discove. ed, the complaint should allege the facts newly discovered with the same particularity as was necessary in the affidavit preliminary to filing a bill of review, and as is necessary on a motion for a new trial, and especially it should allege the facts, and not merely the result of the judgment of the plaintiff upon the facts said to be newly discovered.

2. Same—What must be alleged and shown.

It was necessary to obtain the leave of the court before filing a bill of review in equity; and it was also necessary to present an affidavit that, among other things, should show the nature of the new matter, in order that the court might exercise its judgment upon its relevancy and materiality. The new matter was to be such as, if known, would probably have produced a different determination. The same principle applies to a case of a judgment at law, which a complaint asks to review. On a motion for a new trial on the ground of newly discovered evidence, it was necessary to show with precision who were the new witnesses, and the facts to which they could testify, and it is generally necessary to present the affidavit of the new witness. This is to show the court that a different result would probably follow the introduction of the new proof.

3. Same—When complaint demurrable.

Where the complaint does not show what is the supposed newly discovered evidence, and who are the witnesses that can give it, the complaint is demurrable.

4. Same—When equity will refuse to interfere.

And where it appears from the generality of the statements of thé complaint that, possibly, facts sufficient to apprise the plaintiff of the fraud, and which are the facts upon which the plaintiff relies to prove the fraud, came to plaintiff’s knowledge before the judgment was entered, if this were so the plaintiff had a remedy at law, and equity will refuse to interfere when there might be relief by motion at law.

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5. Same—When injunction will be vacated.

A preliminary injunction having been granted, on a motion to vacate the injunction, the facts of the case having been fully examined by the court below, and the preponderance of the evidence to support the allegations of fraud in the complaint was not with the plaintiff; and where even if it appeared that some fraud had been perpetrated, but there whs no proof of the particular fraud set up in the complaint, and where in addition the complaint is demurrable, the injunction will be vacated.

6. Same—Costs in discretion of trial court.

On the question of allowing defendants their costs severally, the finding of the trial judge on the facts before him is conclusive, and he having found that the several demurrers were interposed in good faith for the protection of the several interests, they are each entitled to costs.

Appeal by plaintiff from interlocutory judgment entered upon order made upon demurrer of the defendants and sustaining the demurrer.

This action seeks to vacate and set aside several judgments already entered for work done in the grading and regulating of Ninety-fifth street, between Tenth avenue and Riverside drive, in the city of New York. The contract upon which these judgments were based, was made between one of the defendants in this suit, John Brady, and the city of New York. The contract was let upon what is known as an unbalanced bid; that is, the contractor offered to furnish the several classes of labor or material called for by the contract at prices so distributed that considerably less than the fair value was asked for one or more classes, and considerably more than the fair value for other classes, with the expectation that the quantities ultimately called for would be so changed as to secure to the contractor a larger profit than he would have secured for the furnishing of the quanties according to which the bids were tested.

The complaint alleged that, in March, 1883, the common council of the city of New York adopted an ordinance that Ninety-fifth street, from Tenth avenue to the Riverside drive, be regulated, graded, curbed and flagged under the direction of the commissioner of public works. Pursuant to this ordinance, he advertised for bids upon a statement of the nature and extent of the work to be done. This statement consisted of estimates prepared by the surveyor, who was appointed to take charge of the work. These estimates were as follows : 1,930 cubic yards of earth excavation; 21,540 cubic yards of rock excavation; 2,850 lineal feet of new curbstone to furnish and set; 10,125 square feet of new' flagging to furnish and lay.

In accordance with the advertisement, there were thirteen bids. The following table shows the highest and the lowest and two intermediate bids :

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For earth excavation, the reasonable price of which was forty cents per cubic yard, Brady bid eight dollars per cubic yard, and for rock excavation, the reasonable cost of which was one dollar and fifty cents per cubic yard, he bid one-quarter of a cent per cubic yard. According to the preliminary estimate of the surveyor, by which the bids were tested, Brady was the lowest bidder, the gross amount of his bid being $15,676.28. As a matter of fact, the amount of earth to be excavated on the street was much greater than that named in the surveyor’s estimate, and the. amount of rock was much less. This fact was well known to Brady, as the complaint charges, but it was not known -to the officer of the city by whom the contract was let.

According to the certificates of the quantities of work performed, which were made by the surveyor, the amount payable under the terms of the contract proved to be upwards of $116,000, instead of $15,000. In addition to this, the contractor has made a claim for some $62,000 alleged to be due him for extra work, for which he was not allowed by the surveyor. At the figures representing the reasonable value of the work, its entire cost should have been about $30,000.

Two payments under the contract were made voluntarily by the city, amounting in the aggregate to' upwards of $30,000. These payments were made respectively on September 5 and October 23, 1883.

In February, 1885, a further payment of $11,000 was made under a judgment recovered in an action brought by John Brady against The Mayor, etc., which was tried in this court before Judge Truax. No defense was interposed by the city, except the unconscionable character of the bids, which, as it was claimed, was such as to constitute constructive fraud. This position was overruled by the court, and a verdict was directed against the defendants.

In August, 1885, a further payment of upwards of $37,000 was made by the city under a judgment in a second action brought on behalf of John Brady, but in the name of Bernard Brady, as assignee. This judgment was entered by default, it being supposed by the officers of the city that there was no defense to the action.

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In April, 1886, a third action was commenced in the name of said Bernard Brady, the assignee of John Brady, to recover $37,000 as the balance alleged to be due under the final certificate of the surveyor, and the sum of $62,000 claimed for extra work as hereinbefore stated. This action is still pending and undetermined.

When the two judgments above mentioned were entered, the contract had already been the subject of more or less investigation, but no evidence had been obtained of any actual fraud in connection with the letting of the contract or the manner of its performance. For this reason no appeal was taken from the judgment entered after the trial before Judge Truax, and no defense was made to the second suit. It was subsequently learned that the contractor had been guilty of fraudulent practice during the progress of the work, in which he had succeeded in imposing upon the surveyor and procuring to himself in the surveyor’s measurements of more earth than he had actually excavated.

Accordingly, in August, 1886, before issue was finally joined in the third, the then pending suit, a motion was made bossed on affidavits setting forth the fraudulent practice above referred to, for an order vacating the two judgments already entered, and granting leave to the defendants to serve amended answers in each of the two actions. This motion was granted in December, 1886, but on appeal the orders granting the motion were reversed by the general term of this court. Brady v. The Mayor, 22 J. & S., 457.

In August, 1886, after the motion papers in the last named case were prepared, evidence was obtained of the fact that the defendant John Brady had secured the awarding of the contract to himself by means of fraudulent representations made to the commissioner' of public works. Such misrepresentations were made in the name of the surveyor of the work by Brady’s procurement. This evidence was not available to the city at the time when those motion papers were prepared, but became available, however, by means of certain facts which were disclosed in the examination of one Duffy as a witness before the commissioners of accounts, held in December, 1886, and January, 1887, and his examination as a witness de bene esse in the pending suit of Bernard Brady v. The Mayor, also in January, 1887.

The facts then disclosed, in connection with the documents already in the possession of the city and other facts which had been developed in the course of the prolonged investigation of the contract, made the chain of evidence complete. Accordingly this action which is in the nature of a bill of review was commenced to vacate and set aside the judgments already entered, to have the contract declared void, and to suffer the plaintiff to recover from the defendant the amount already paid upon the contract, if not

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in full, then at least so much thereof as is in excess of the reasonable value of the work. It also seeks to restrain the prosecution of the pending suit against the city, in which Bernard Brady is plaintiff, or to prevent said Brady from offering in evidence on that suit as adjudications upon the validity of the contract, the judgments already entered.

A preliminary injunction was granted at the commencement of the action restraining the pending litigation. Demurrers to the complaint were interposed on the ground “ that the complaint does not state facts sufficient to constitute a cause of action.”

The special term sustained the demurrer, Truax, J., saying * * * “The allegation is that after the contract was signed, Brady did certain things which plaintiff alleges were fraudulent. Even if this were so, it would not constitute a defense to any action brought on the contract. But there is- another reason why the demurrer should be sustained, and that is there is no precedent for the relief asked by the plaintiff. It is well settled that a court of equity will not enjoin the enforcement of a judgment of a court of law for any defense or right, which could be asserted in the court of law, unless it can be shown that the plaintiff was prevented by fraud, mistake or accident from maintaining his legal rights, and that the obstacle which prevented him from maintaing such rights could not have been overcome or avoided by any reasonable diligence or care on his part. These requisites are absolutely indispensable, the rule is inflexible, and it is enforced with special strictness when the ground relied upon for relief is newly discovered evidence which the party had failed to obtain through ignorance amounting to accident or fraud. Equity, said Judge G-rover in N. Y. and Harlem R.. R. Co. v. Haws ( 56 N. Y., 181 ), does not interfere to restrain a judgment upon the ground that it was erroneously entered, but only upon -the ground that enforcing it would be contrary to equity and good conscience, as shown by facts, of which the party could not avail himself as a defense, or when he was prevented from so doing without any fault of his own, by the fraud of the other party. The plaintiff has not shown any of these facts.” _ The demurrer is sustained with leave to amend the complaint, etc.

From this order sustaining the demurrer, plaintiff appeals.

Henry R. Beekman {David J. Dean, and Arthur M. Masten, of counsel), for app’lts; L. Lapin Kellogg, for John Brady and -Bernard Brady; Arthur H. Smith, for the Laflin & Rand Power Company; Jandine Lyng, for Henry Judson Morris.

The complaint seeks to set aside judgments at law in several actions that have been tried and to interpose the defense of fraud in those actions. The

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plaintiff’s right as claimed for this relief is placed upon those allegations of the complaint that relate to the plaintiff’s claim, that the fraud was discovered since the judgments, from evidence, also since then discovered.

I do not examine whether the defense, if interposed and sufficiently proved, would result in a verdict for plaintiff, and do examine the complaint to ascertain whether it shows that such a defense would be sustained by the evidence that the complaint alleges has been newly discovered.

The present complaint is of the same nature as the former bill of review, that might be brought upon the discovery of new matter. To secure leave of the court, which it was necessary to obtain, to file the bill, it was also necessary to present a,n affidavit that, among other things, should show the nature of the new matter, in order that the court might exercise its judgment upon its relevancy and materiality. The new matter was to be such as, if known, would probably have produced a different determination. Story Eq. PL, §§ 412-413; Wiser v. Blachly, 2 J. C. R., 488; Livingston v. Hubbs, 3 id., 124; 2 Daniel’s Ch. Pr. (5th Am. ed.), 1578, note.

This was the rule in the case of an application for a review in equity. But its principle applies to a case of a judgment at law, which a complaint asks to review. Of this it is said that a new trial will not be granted unless there can be no doubt as to the result of the case given to another jury. Earl of Oxford’s Case, 2 White & Tudor’s Leading Cases in Eq., 1383.

In motions for a new trial at law, for newly discovered evidence, it was necessary to show with precision who were the new witnesses and the facts to which they could testify. It is generally necessary to present the affidavit of the new witness. This was to show the court that a different result would probably follow the introduction of new proof.

Equity refused to interfere, when there might be relief by motion at law. Simson v. Hart, 14 Johns., 77 .

I am of opinion that a complaint like the present, if sustainable, as setting forth a cause of action, should allege the facts newly discovered, with the same particularity as was necessary in the affidavit preliminary to filing a bill of review, or as is necessary on a motion for a new trial, and that especially it should allege the facts and not merely the result of the judgment of the plaintiff upon the facts said to be newly discovered.

The case made by the complaint, in respect of matters now under review, is sufficiently described by the following references to it.

After alleging that certain investigations were made, it proceeds thus: “As the result of such investigation, this plaintiff is now in possession of numerous facts which constitute a sufficient defense * * * which said facts are

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of such a nature that they could not, with the exercise of due diligence, have been discovered in time for their production upon the trial, etc. Such facts were derive'd in many instances from the statements of laboring men, or from employees of the defendant John Brady, or residents of the vicinity, etc. In other instances they were derived from the statements of engineers and others.” It does not here appear that the matters called facts were facts, or what was their weight and significance. It does not appear to the judgment of a court that the matters would tend to support a defense of fraud. The allegations disclose no more than the opinion of plaintiff.

The complaint also, as to Duffy, alleges: “Said Duffy was twice called as a witness and examined de bene esse on behalf of the defendant Bernard Brady in the suit beforó referred tp, in which he is plaintiff, under a pretended claim that said Duffy was about to leave the state, the first of such examinations being held on the 6 th day of March, 1866, and the second on the 28th day of January, 1887. Between the dates of such examinations, to wit, on the 29th day of July, 1886, and the 7th and 13th days of December, 1886, and the 8th day of January, 1887, said Duffy was examined before the commissioners of accounts, and from the testimony then given by him in connection with his cross-examination upon his second examination de bene esse, and certain other independent examinations made by said commissioners, the evidence was obtained of the fraudulent and corrupt manner in which the aforesaid report was procured, and the award of said contract thereby effected. Such evidence was not complete, however, nor available to the plaintiff until some months after the preparation of said affidavits and motion papers.”

In this, a general inference from many things is called evidence. Whether the pleader is justified in calling it evidence, is not made to appear. There is no statement of what the facts are, and of the witnesses who can prove them, and whether the testimony of such witnesses can now be produced. The complaint does not allege what Duffy testified, and what he is now willing to testify to. From the generality of the statement, it is possible that facts sufficient to apprise the plaintiff of the fraud, and which are the facts upon which the plaintiff substantially relies to prove the fraud, came to its knowledge in time for their use before Judge Yak Vorst’s decision. If this were so, the plaintiffs might have the legal remedy to which they should resort before resorting to equity. Graham v. Stagg, 2 Paige, 321; Dodge v. Strong, 2 Johns. Ch., 228 , and cases cited.

The complaint in saying “such evidence was not complete or available to the plaintiff,” puts a construction upon the evidentiary force of the facts which might not be jus

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tified if the facts were alleged, and the exact time when they were first known.

For the reason that the complaint does not show what is the supposed newly discovered evidence, and who are the witnesses that can give it, the judgment and order appealed from should be affirmed.

In the appeal from the order allowing the defendants their costs severally, the finding of the judge on the facts before him is conclusive. He was of the opinion that the several demurrers were interposed in good faith, for the protection of several interests.

Order affirmed, with ten dollars costs.

All concur.