Arnold v. Norfolk & New Brunswick Hosiery Co. — 47 N.Y. St. Rep. 362

Majority

p. 362

Anna M. Arnold, App’lt, v. The Norfolk & New Brunswick Hosiery Co., Resp’t.

(Supreme Court, General Term, Second Department,

Filed July 22, 1892.)

Headnote

1. Default—Opening—Estoppel.

A party is not precluded from moving to open a judgment taken by default by reason of his having paid such judgment. Such payment is in no sense voluntary.

2. Same—Terms.

Where a defendant is guilty of loches in moving to open a default, but his course of procedure was dictated not by intention to evade the jurisdiction of the court, but by an erroneous judgment as to the form in which best to present his defense, and the effect of the judgment will probably extend to other cases between the same parties, such default will be opened, but on terms which will afford plaintiff indemnity for her expenses, and secure her in case of future recovery.

Appeal from order opening a default, and giving defendant leave to answer.

Blackwell Bros., for app’lt; W. D. Edmonds, for resp’t.

—This is an appeal from an order setting aside a judgment against the defendant entered by default for $11,077.25, and giving the defendant leave to answer. Two similar applications had previously been made and denied. No terms were imposed by the court at special term.

It would hardly be profitable to recite the facts under which this default was suffered, long narratives of which áre given in the papers on each side. The loches of the defendant were great. It certainly deserved much, and probably all, the censure passed upon it in the opinion of Mr. Justice Bartlett denying the first motion to open the default. Still we think that the defendant’s course was dictated not by an intention to evade the jurisdiction of this court, but by an erroneous judgment as to the form and manner in which best to present its defense.

The effect of this judgment may go beyond this case, though the amount involved in this case alone is large. In an action for subsequently accruing instalments of royalty under the contract which is the basis of this suit, the circuit court held that the judgment suffered by default was conclusive as to the plaintiff’s right to recover. That ruling this. general term held erroneous. But the question is not free from doubt and will remain a stumbling block in further litigations between the parties, until it is finally settled by the court of appeals.

We think it wiser and fairer to give the defendant, despite its default, a full opportunity to present its defense in court and have it passed upon the merits.

The point raised by tfyk plaintiff, that the defendant by paying the judgment is precluded from applying to open it, is untenable. Such payment is in no sense voluntary. It is a payment under compulsion of law. A defendant is under no obligation to suffer his property to be seized on execution in order that he may retain his right to vacate the judgment or reverse it on appeal.

But terms should have been imposed as a condition of opening

p. 363

the default. The plaintiff’s expenses must have been large, and as the amount involved is large the defendant can well afford to make reasonable indemnity.

The order appealed from will be affirmed on condition that the defendant pay the plaintiff the sum of $250 and the disbursements of this appeal, and on the stipulation that the defendant will not apply by motion or by action for restitution until it recovers judgment in its favor in this action.

Barnard, P. J., concurs; Dykman, J., not sitting.