Garvey v. Carey.

New York; said settlement to be governed and founded on a certain agreement made and entered into by and between said Carey and Garvey, bearing date January 23, 1867." Upon this submission, the arbitrators made an award, "that John Garvey is entitled to receive from John G. Carey the sum of five thousand one hundred and twenty-five dollars and sixty cents, as his share of the profits derived from said buildings, cash advanced by Carey to Garvey to be refunded by said Garvey.

To the complaint the defendant answered:

1. That the arbitrators, after first notifying the parties to appear before them, and after having partly heard the allegations of the defendant, proceeded irregularly and illegally, without notice to the defendant, and without fixing any day for the hearing of the matters submitted; and made their award before the case was finally sub`mitted to them, and before the defendant had concluded his proofs and allegations before them.

2. That the arbitrators, in computing the amount of profits to which each party would be entitled under the agreement, made a mistake in such computation-which mistake was a clerical error-and that the award was the result of such clerical error.

The plaintiff now demurred to the answer for insufficiency.

George C. Genet, for the plaintiff.

Nelson Smith, for the defendant.

MONELL, J.-The answer in this case is, I think, sufficient both in substance and in form. The defendant seeks to avoid the award on two grounds-namely, misconduct on the part of the arbitrators, and mistake in ascertaining the amount due from the defendant to plaintiff. Such grounds were always sufficient, in equity, to vacate and annul an award (Herrick v. Blair, 1 Johns. Ch., 101; Van Cortlandt . Underhill, 1 Johns., 405; Bouck v. Wilber, 4 Johns. Ch., 405; Knox v. Symmonds, 1 Ves., 369; Corneforth v. Geer, 2 Vern., 705), and may now be set

Garvey v. Carey.

up as a defense to an action upon the award (Dobson v. Pearce, 12 N. Y. [2 Kern.], 156; New York Central Ins. Co. v. National Protection Ins. Co., 14 N. Y. [4 Kern.], 85).

The misconduct complained of, was in proceeding without notice to the defendant, and without fixing any day for the hearing of the matters submitted, and in making the award before the case was finally submitted to the arbitrators, and before the defendant had concluded his proofs. If the defendant shall be able to sustain these charges of misconduct, by proof, I think he will make out a strong case against the validity of the award, and be entitled to have it set aside. The charges of misbehavior are stronger than in any of the cases to which I have referred.

The second defense demurred to- of mistake in the computation made by the arbitrators is a little indefinitely stated. It does not appear what the nature of the mistake was, except that it is alleged that it was a clerical error. I think, however, it was sufficient in form, and proof may be given under it of such a mistake as the court will recognize as sufficient to vacate the award.

The disposition I have made of the demurrer renders it unnecessary for me to decide whether the complaint states a cause of action.

The defendant must have judgment on the demurrer, with costs.

Judgment accordingly.

N. S.-VOL. IV.—11.

White v. Brownell,

WHITE against BROWNELL.

New York Common Pleas; General Term, June, 1868. THE NEW YORK "OPEN BOARD OF BROKERS."-RIGHTS OF MEMBERS.

The Open Board of Brokers in the city of New York is not a copartnership, within the operation of the equitable remedies afforded by the courts for the protection of the rights of partners as between themselves.

Nor is that board a corporation, in such sense as to render it subject to the rules by which courts of equity interfere to restore a corporator who has been unlawfully expelled or disfranchised, to his privileges of membership. As the privileges of membership in a voluntary unincorporated association are not conferred by the sovereign power, but are merely created by the organization itself, courts of law cannot compel the admission of an appliçant for membership, nor interfere to restore a member who has been deprived for non-compliance with the conditions on which membership is made to depend.

In a suit for an injunction to restrain the officers of a voluntary incorporated association from carrying into effect a resolution or vote suspending the plaintiff from membership, the only question which can arise is, whether the plaintiff was suspended in accordance with the constitution and by-laws of the association. Unless they were violated by the proceedings against him, he has no ground of complaint. Those who become members of such associations are bound by their rules, not being in conflict with the law of the land; and the courts can interfere no further than to hold the association to a fair and honest administration of those rules.

The decision at special term in the case of White v. Brownell, 3 Ante, 318, -affirmed.

Appeal from an order at special term, granting a motion to dissolve an injunction.

The general facts out of which the controversy in this action arose, are fully stated in the report of the decision appealed from (3 Ante, 318). The case now came before

White v. Brownell.

the general term on an appeal by the plaintiff from the order dissolving his temporary injunction.

William C. Barrett, for the appellant.-First. The plaintiff is a member of the Open Board of Stockbrokers in the city of New York. This board is a voluntary association of individuals, organized under no statute, nor other special enactment, its object being to afford the members the conveniences of a public mart or stock exchange. The plaintiff was lately suspended by the defendant Brownell (as president of the board) from membership. Deeming such action to be void, he commenced this suit, for the purpose of testing that question, and obtained a temporary injunction restraining the board from further interference with his rights, privileges and franchises as a member of the association.

The facts which led to his suspension were these: on the 18th of February, 1867, Mr. White made a contract with the firm of Curry, Martin & Co., who are also members of the board, whereby he agreed to sell to them, and they agreed to purchase from him, one thousand shares of the capital stock of the Hudson River Railroad Company at the price of $128 per share. By the terms of this contract, the stock was to be delivered, and the contract price paid at any time which might suit Mr. White's pleasure during the year of 1867. Afterwards, and on the 18th day of April, 1867, the Hudson River Railroad Company adopted certain resolutions for the increase of the capital stock of the company. The effect of these resolutions was to permit any person who appeared to be a stockholder upon the books of the company, on April 10, 1867 (when the books were closed), to subscribe for as many shares of the increased stock as he held of the old, by paying either the sum of $50 per share in cash, and thereupon at once receiving the new shares; or by paying the sum of $54 per share in installments; and thereupon receiving the new shares on October 15, 1867. On April 10, 1867, but after the transfer books of the Company had been closed, and when it was too late for a person not then

White v. Brownell,

a stockholder to subscribe for the new stock, Currie, Martin & Co. notified Mr. White that they elected to subscribe for the additional stock. This was the only notice. which Mr. White ever received from them. They never told him whether they desired cash stock at $50 per share, or time stock at $54 per share; nor did they ever tender him any money to enable him to effect. such subscription. Mr. White, in fact, was not then a stockholder, and had no intention of becoming one until such time as in the exercise of the option conferred upon him by the contract, he made the necessary purchase wherewith to fullfil said contract. Each of the parties from time to time deposited in the United States Trust Co., as security for the faithful performance of the contract, various sums of money, amounting in the aggregate to $55,000 each.

C.,

On September 5, 1867, Currie, Martin & Co. called upon the plaintiff to put up $10,000 margin beyond the $55,000 already on deposit. At this point the dispute arose. M. & Co. claimed that the plaintiff was bound to deliver them 2,000 shares of stock upon this contract calling for but 1,000. If they were right in that demand, then the plaintiff was deficient in margin. If they were wrong, then the plaintiff had an abundance of margin. C., M. & Co. claimed that, according to some Wall-street usage, where a party makes a contract for the delivery of stock at a future day, all dividends declared by the company between the date of the contract and that of the delivery, enured to the benefit of the purchaser; and they insisted that this increase of the capital stock was in the nature of a dividend, and that they thus became entitled to the additional 1,000 shares, which it was the option of the stockholders to subscribe for or not, at their pleasure. Mr. White declined to acknowledge the correctness of this position, and refused to deposit additional margin, asserting, as was the fact, that his margin was ample as security for the delivery of 1,000 shares of the stock. C., M. & Co. then took measures to close the transaction, in their way, and according to their ideas of legality and fitness, by purchasing 2,000 shares of the stock at the board. This