Gilpin v. Daly — 36 N.Y. St. Rep. 666

Majority

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Charles Gilpin, Jr., App'lt, v. John Daly, Resp’t.

(Supreme Court, General Term, First Department,

Filed February 11, 1891.)

Headnote

1. Depositions—Examination before trial—G-amino—Penal Code, § 343, v

In an action to recover moneys of a foreign corporation alleged by the complaint to have been taken by its treasurer and lost by him at a gambling house maintained by the defendant, Daly, and other persons unknown, Held, that the “ proceeding ” was within, and the complaint involved an “investigation” for a violation of a provision of chap. IX of the Penal Code, and that § 343 of said chapter, providing that a person shall not be excused from testifying in an investigation or proceeding for a violation of said chapter because his testimony would tend to convict of a crime, but that such testimony shall not be used against him in a criminal action, applied; that hence an order requiring the defendant, Daly, to appear and testify before trial, was properly granted, and that he was not excused from testifying.

3. Same.

Said § 343 Penal Code is in the line of the policy of this state, as shown in 1 Revised Laws, 153, § 3, and in 1 R. S., m. p. 663, 664, which is to compel the receiver of moneys by gambling to give evidence to.support an action for the recovery of such moneys, and said § 343 must be held to cover in one section all the previous provisions of the Revised Statutes on this subject.

Appeal from an order vacating an order for the examination of the defendant as a witness for the plaintiff before the trial.

John L. Oadwalader, for app’lt; John Graham, for resp’t.

This action has beén brought to recover the sum of $5,500, moneys owned by the Glamorgan Iron Company, a corporation existing under the laws of the state of Pennsylvania, and charged to have been lost by gaming at a gaming establishment, in whole, or in part, maintained by the defendant at 39 West Twenty-ninth street in the city of New York. It is alleged that these moneys were wrongfully taken by the treasurer of the company and lost by gambling at that establishment, and won by, and paid to, this defendant and other persons intended to be included with him as defendants in the action. After the moneys had been lost in this manner, the company made an assignment for the benefit of its creditors to the plaintiff, and it is under the title so acquired that he has brought this action for an accounting and recovery of these moneys. And if they were in this manner lost and won either by the defendant alone, or acting in concert with other persons, then there seems to be no well-founded objection standing in the way to prevent the plaintiff from maintaining the action.

The affidavits on which the order for the examination of the defendant was made, have c omplied in their formal statements with all the requisites prescribed for that object by the Code of

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Civil Procedure. And it is shown by that oí the plaintiff that he is dependent upon the information expected to be obtained from the defendant for his ability to connect him with this estabment as one of the proprietors thereof, and to subject him. to a liability to refund this money. His examination before the trial is shown to be necessary to obtain evidence to support the action, and there is a probability that it can be derived from no other source. It is not liable, therefore, to the objection taken to its general insufficiency, for it has complied with all that has been exacted by the case of Jenkins v. Putnam, 106 N. Y., 272 ; 8 N. Y. State Rep., 710, and the other-authorities brought on behalf of the respondent to the attention of the court.

The order for the defendant’s examination was not vacated because of any formal defect in the affidavits on which it was made. But that was ordered upon the objection stated in the affidavit of the defendant, that he is not obliged to answer under oath, generally, or specifically, any of the allegations implicating or connecting him with gambling, or the pretended gambling transactions, charged in the moving affidavits. And it has been declared by the law in general terms that a person will not be required to give evidence having a tendency to prove that he has been guilty of a crime. And the principle has been applied in suits in equity, where it has been held that a defendant would not be directed to answer on oath, when his answer must have that effect. McIntyre v. Mancius, 16 Johns., 592 .

But the protection of the public, as well as of its individual members, has from time to time induced the enactment of legislative exceptions to this general rule. They have been framed more effectually to discover the existence of offenses committed in seclusion and concealment by bringing their participants before the courts and compelling them to disclose their own participation in and knowledge of these offenses, but at the same time excluding the use of their disclosures as evidence against the person or persons making them in any criminal prosecution. And. the loss and gain of money by gaming, or gambling, has been considered to be a proper subject for this description of legislation. Accordingly, in the revised laws of this state, in 1813, after declaring gaming to be unlawful, and providing a remedy for the recovery of the money thereby lost, it was provided that every person liable to suit under its provisions should be compellable to answer upon oath such bill as should be exhibited in the court of chancery against him for discovering the money or other things won at play contrary to the intent and meaning of the act. And in the action the court was thereby empowered to proceed and decree thereupon, and enforce the decree, as was usual in other causes in the court. 1 Revised Laws, 153, § 3. And that was made to operate as a discharge of the defendant from further punishment, forfeiture or penalties incurred in or about the subject-matter of the suit.

These provisions disclosed it to have been the policy of this state, at that early day, to provide for the redress of the wrongs produced by gaming, by extorting from the winner the evidence

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he might be able to give in the way of supporting an action for the recovery of money lost by gaming. And they were followed by others made a part of the Revised Statutes in 1830, enlarging and rendering them still more effectual, for in addition to the continuance of the obligation of the winner to answer a bill of discovery, and the power vested in the court by its decree to compel the return of the money, it was declared that no person, other than the ■ parties in the cause, should be incapacitated or excused from testifying touching any offense committed against, any of the preceding prohibitory provisions of the law, by reason of his having played, bet or staked at any game, but his testimony should not be used in any suit or prosecution thereby authorized against himself. 1 R. S., 663, §§ 18, 19. These two sections provided for securing a complete discovery of alleged gaming transactions, first by the evidence of all persons having knowledge concerning them who should not be parties to the action, and secondly, by the answer on oath of the party proceeded against to the bill of discovery. And the answer was not deprived of any of its effect by the next section, declaring that it should not be used as testimony in any case against the person making the discovery, for that must have been intended to relate to any other suit than the suit in which the discovery should be made, as the decree in that suit was allowed to compel the party to it to return the money it should be brought to obtain. By these sections complete authority was supplied for obtaining the evidence of all persons participating in or having knowledge of gaming transactions, and for the recovery of the money won thereby. They included all that could be required or provided, for, in this class of cases, every person was required to give his evidence, either when sworn and examined as a witness or by answering on oath the' bill of discovery.

And it was in this state of the law that the Penal Code was enacted in 1881, which, by § 342, declared that “ No person shall be excused from giving testimony upon any investigation or proceeding, for a violation of this chapter, upon the "'ground that such testimony would tend to convict him of a crime, but such testimony cannot be received against him upon any criminal investigation or proceéding. ”

It could not have been intended that this section should in any effect abridge the efficiency of what bad previously been enacted upon this subject. But as the bill of discovery bad been generally abolished, the intention was to combine in one general section, as this is, all that had previously existed in these two sections of the Revised Statutes. There was no cause for reducing or restricting the preceding law, but there was for changing its form, to render it harmonious with the progress which had been in other respects attained. And that is probably all that was designed to be accomplished by this change of language. This probability is also confirmed by chapter 593 of the Laws of 1886, which by its first section repealed the two sections already mentioned of the Revised Statutes That certainly would not have been done without the legislative understanding that this section of the

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Penal Code comprehended all that had been included in the preceding law.

Any different conclusion would necessarily support the conviction that the legislature intended to tolerate gaming transactions "by excluding the ability to obtain the evidence of their existence, and that there can be no reason for believing. What appears to have been intended, and what was in fact accomplished, was to ■combine the preceding law in one section, which by its general. language was made to include all the participants in, and parties to, gaming transactions. And this action is directly within the ■section, for it is a proceeding and includes an investigation for a violation of the provisions of the chapter of the Penal Code containing this section. This language, while not the most artistic, is still entirely comprehensive, including as it does all possible investigations and proceedings. And that this was the understanding of its effect is further disclosed by the last clause of the section, declaring that the testimony .so obtained shall not be received against the person giving it upon criminal investigation or proceeding.

This last mentioned investigation or proceeding can only be such as may be taken for the examination, indictment, or punishment of crime, and consequently must have been intended to include these proceedings. And the effect of this clause is to apply with equal reason the preceding part of the sentence to .all personal actions and prosecutions for the recovery of money lost by gaming. These actions are, as the phrase has here been used, investigations and proceedings for a violation of the other sections Of the same chapter of the Penal Code. And similar phraseology employed in another part of the Penal Code was in this manner construed and applied in People v. Sharp, 107 N. Y., 427 ; 12 N. Y. State Rep., 217. This chapter of the Penal Code has made it unlawful for a person to exact or receive from another, either directly or indirectly, any money or valuable thing, by reason of the same having ^been won by playing at ■cards, faro, pr any other game of chance, or for any bet or wager upon the hands or sides of the players; and it has declared it to be a misdemeanor for any person to keep a room, shed, tenement, tent, booth, building, float or vessel, or any part thereof, to be used for gambling, or for any purpose, or in any manner forbidden by this chapter. Id., §§ 340, 343. And t]ie complaint in this action charges the defendant with a violation of each of these sections. And to maintain this charge, an examination of the defendant before the trial has been- shown to be necessary by the way of obtaining evidence to establish its truth. An investigation is to be made in the action to prove this charge. And that places this suit within the language, as well as the spirit, of the section, depriving every person of the privilege of refusing to testify in it on the ground that his testimony will tend to convict him of a crime. The testimony obtained cannot be used to bring about his conviction of a criminal offense, and for that reason he has been obliged to give his evidence when it may be "required in support of a civil action. This legislation is in com

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píete harmony with the general policy which has been adopted to-secure the discovery of other secret and fraudulent violations of the law. When that may be successfully concealed by the contrivances and artifices of the parties, the policy has been to oblige them, under the solemnity of their oaths, to appear and disclose the-facts, exposing their transactions to the discovery of the tribunals empowered to investigate them. And as a part of this policy, not only betting and gaming practices are to be brought to the light of j udicial scrutiny and correction by the evidence of the parties to or concerned in them, but the same principle of unlimited discovery has been also applied to fraudulent dispositions of the property of debtors. Provisions for that object were enacted soon after those for the discovery by the evidence of the parties in civil actions of losses by gaming and betting. They are found as early as chapter 17 of the Laws of 1823, requiring every person to answer as to such transactions, but at the same time guarded by the same protection that the evidence obtained shall not be used against the person giving it in any prosecution for the criminal misdemeanor committed by his fraudulent misconduct. And this in substance and effect has ever since then remained the law applicable to the disposition made by a debtor of his property with the intention to defraud his creditors. Laws 1833, chapter 14; 2 E. S., 181, § 41; Code Civil Procedure, § 2460.. A similar practice has also been made applicable to usurious transactions and their discovery. 2 E. S., 6th Ed., 1166, § 11. And to the purchase of things in action by attorneys and others, to institute suits thereupon. 3 E. S., 6th Ed., 449, §§ 59-70. And which still remains the law, except so far as it may have been qualified by the questionable policy of the Code of Civil Procedure, allowing attorneys to become interested in the fruits and proceeds, of suits prosecuted by them.

This legislative policy requires that the section contained in the Penal Code which has already been - examined shall be construed with a reasonable degree of liberality to promote the remedy it has been designed to advance. And under that construction this action is within its language and intent. The defendant is therefore legally bound to appear and submit to an examination on oath to verify, as far as he may be able to do that, the facts brought in issue by his answer in this action, and thereby to supply the plaintiff with the evidence which has become requisite to maintain this suit.

It is but just to the court making the order from which the appeal has been brought, to add that the statutes affecting the question involved, were not referred to by the counsel when the application to vacate the order for the defendant’s examination was heard, as indeed they were not on the argument of the appeal. If they had been, that order would not then have been vacated. Por the law as it is now in force does supply all needed authority for subjecting the defendant to a full, searching and complete examination for the discovery of the facts included in the issue in this action. The order should, therefore, be reversed, with ten dollars costs and the disbursements, and the motion denied.

Van Brunt, P. J., and O’Brien, J., concur.