Garczynski v. Russell — 57 N.Y. St. Rep. 666

Majority

p. 666

Caroline R. Garczynski, Resp’t, v. Dorr Russell, Individually, and as Executor and Trustee, etc., Appl’t.

(Supreme Court, General Term, Fourth Department,

Filed February 25, 1894.)

Headnote

Reference—Duty of referee.

Under a reference to hear and determine all the issues in an action where an accounting is part of the relief asked, the referee must take and state the account, if plaintiff is found to be entitled thereto.

Appeal from an order settling the form of the judgment to be entered on the report of the referee.

Johnson & Lamb, and E. M. Harris, for appl’t; George M. Weaver, and A. M. Beardsley, for resp’t.

A portion of the relief demanded in the plaintiff’s complaint was that an accounting should be had by the estate of Lucy G. Russell, and the interlocutory judgment, entered in pursuance thereof, contained the following provision :

“ Fourth. That the plaintiff is entitled to have a fair and full accounting of the estate of the said Lucy G. Russell, and particularly of the said railroad stocks, securities, and other property, transferred to the said Lucy G. Russell by the said Dorr Russell, and of the proceeds and avails thereof, and of all moneys and property received by her, directly or indirectly, from the said Dorr Russell, and of the rents, issues, and profits thereof, and of the said real estate. And the said defendants are, and each of them is, hereby ordered and required to discover and answer as to the same, upon their several oaths. The plaintiff is hereby authorized, upon proper notice to the attorneys for the defendants, to move for the appointment of a referee to take such account, such appointment to be made by order, to be entered at the foot of this” decree. If it shall appear, on said accounting, that the said Lucy G. Russell paid anything from her own personal estate for the said railroad stocks and securities, then that an account

p. 667

be taken of the moneys so paid, and also of the moneys, property, and profits received by her, or by any other person for her use or, by the defendants, or either of them, and the balance, if any, remaining unpaid, and due to her, or her estate. That, upon such accounting, the defendants, and the estate of the said Lucy Gr. Russell, be charged with any and all moneys and property, paid by said Dorr Russell, directly or indirectly, upon the said Edward Clark mortgage, since the conveyance of the mortgaged property to the said Lucy Gr. Russell, and with the said railroad stocks, securities, and other property transferred to her by the said Dorr Russell.”

Thus, the matters that were referred to a referee, to hear and determine, were only partially tried, or at least but partially determined. The more important questions involved in the case were: (1) As to what interest the estate of Mrs. Russell had in the real estate mentioned in the complaint by reason of having paid the Clark mortgage or otherwise; (2) how much she, in fact, paid towards the railroad stocks and other property which stood in her name. The referee’s report, and the judgment entered in pursuance of it, direct that these important matters shall be referred to another referee, to hear and determine, after the entry of an interlocutory judgment, which is, in many respects, inconsistent with such a reference. The learned referee, to whom this action was referred, instead of taking the accounting, and determining the amount of the property, if any, which came into the possession of the estate of Lucy Gk Russell, for which it was liable to account to the plaintiffs, under the facts as found by him, held, as a conclusion of law, that the plaintiff was entitled to have a fair and full accounting, as stated in the demand of the complaint relating to that subject. The order appointing the referee was entered upon the stipulation of the parties, made in open court, that the case be referred to the referee named, to hear and determine, and the order entered in pursuance thereof was “ that the cause be, and the same is hereby, referred ” to the referee named, “ as sole referee, to hear and determine all the issues therein. ”

Under this order, the referee should have heard and determined all the issues made by the pleadings, and if, under the proof before him, the plaintiff was entitled to an accounting, he should have taken and stated the account. It was not the intention of the parties, or of the court, that only a portion of the questions involved in the case should be determined by the referee, aud that those remaining should be determined by another and different referee, to be subsequently appointed. It is obvious that the court and both parties intended that such a determination of the case should be made by the referee as would entitle the party succeeding to a final judgment in the action. We know of no authority to justify a referee in determining only a portion of the questions referred to him, and then to direct an interlocutory judgment, and that the cpurt appoint another referee to complete the hearing, where the whole case is referred to him by the consent of the parties. In this case, no reason is apparent why the referee could not have taken the accounting demanded in the complaint as well

p. 668

as another referee, to be subsequently appointed. The subject of the accounting related, not to matters which might arise in the future, so that a supplemental hearing and report might be necessary, but entirely to transactions which were past, and as to which he might well have taken an áccounting. It was the duty of the referee, on the trial, to take the proof of the respective parties, take an accounting of the matters referred to, settle and determine the account upon the trial before him, and. thus complete the hearing and determination of the case. His report was not only informal, but incomplete. We think it was proper for the special term to set aside the report, and send the case back to the same referee, so that a final judgment might be entered, as was plainly contemplated by the court and partiés, when the reference was ordered. Maicas v. Leony, 113 N. Y., 619 ; 22 St. Rep., 149 . The orderly method of trying this case, as. well as the rights of the defendants, under their stipulation, and the order appointing the referee, required that the whole case should be fully tried and determined by him. Therefore, the special term, instead of settling the judgment upon the report as it stood, and providing for another reference, not contemplated by the defendants, should have sent the case back to the referee, to complete the trial thereof. If it be said that no such motion was made, vet the notice of motion was for a settlement of the judgment, and for such other relief as the court might grant. Under this notice, we think the court should have, at least, refused to settle any judgment until the reference was fully completed, so that a final judgment might be entered. Good faith to the defendants required this. Without questioning the power of the court, in a proper case, to settle an interlocutory judgment upon the report of a referee, and to appoint another referee to take an accounting provided for by such a judgment, Mundorff v. Mundorff. 1 Hun, 41 ; Seymour v. Spring Forest Cem. Association, 19 N. Y. Supp., 100 ; 45 St. Rep., 520 , we think that where, as in this case, all the facts which relate to the accounting exist at the time of the trial, so that the whole case can be disposed of as well, and with less expense to the parties, than before another referee, it is the duty of the referee to complete the trial, and state the account between the parties in his report, so that a final judgment may be entered thereon. It was said by Daniels, J., in Mundorff v. Mundorff:

“ Ordinarily, where the whole issue is referred, it is no doubt the duty of the referee to take, state and adjust the accounts of the parties, on the basis on which, by his decision, he may settle their rights; for, as a portion of the issues, that is included within the reference provided for.”

We are of the opinion that the proper and orderly disposition of this case requires a reversal of the order of the special term, settling the form of the judgment herein, and that the parties have leave to apply to the special term for an order setting aside the report of the referee, and sending the case back to him to complete the trial thereof, so that a final judgment may be entered upon his report. Such a disposition of the case will, we think, better serve the ends of justice, and the interests of all parties, be

Dissent

p. 669

more in keeping with the intention of the parties when the case was referred, and present the questions on appeal, if a subsequent appeal shall be taken, in a manner to be better understood, and more correctly decided, than to leave it in its present incomplete, inconsistent and somewhat confused condition.

Order of special term, settling the form of the judgment to' be entered on the report of the referee, and judgment entered thereon set aside, with $10 costs and disbursements, with leave to either party to apply to the special term for an order sending the case back to the referee, to complete the hearing and determination thereof.

Hardest, P. J., concurs.

Upon this appeal the only questions, as it seems to me, are whether the plaintiff was entitled to have the form of the judgment settled at special term and, if so, whether the form, as settled, corresponded substantially with the directions in the report. A referee, in a proper case, has the right to grant an interlocutory judgment, and such judgment can be reviewed upon a motion for a new trial, (Code, § 1001,) or, as the Code now stands, by appeal from the judgment. Whether, in the present case, an interlocutory judgment was properly granted, is a question not before us on this appeal, but is one that might arise on a direct proceeding to review the decision and judgment. There exist, in this case, no such imperfections as existed in the case of Maicas v. Leony, 113 N. Y. 619 ; 22 St. Rep., 149 , and by reason of which the court of appeals said that the supreme court, in its discretion, had power, on motion, to set the report aside. Ho question is made here that the special term did not have power to settle the decree. The plaintiff had, I think, a right to have it done. ■ If the order, as made, does not settle it, so as to conform to the directions in the report, it shquld be modified, but not set aside absolutely. _

Cases cited

Maicas v. Leony 113 N. Y. 619 N.Y. 1889-03-19 p. 669