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and narrow. In the action all equities may be fully and completely litigated, determined, and adjusted. Section 965 of the Code of Civil Procedure provides, "An issue, either of law or of fact, must be tried as prescribed in this chapter, unless it is disposed of as prescribed in chapter Sixth of this act.” Nothing in chapter 6 places any limitation upon the right to a trial of issues of fact raised in an action, where such issues are required to be determined in order to adjust the rights of the parties. When the defendant Hoffman House, New York, was permitted to intervene, it occupied precisely the same position as though it had originally interposed an answer to such foreclosure, wherein
it raised an issue which either wholly or partially defeated the mortgage; and we know of no power in the court to strike out an answer upon motion, where such an issue was raised, because it is claimed that the questions there at issue have been determined in some other proceeding. It may be that the plaintiff has a right in some form to avail itself of the trial and adjudication which has been had, but, whatever such right may be, it is not the right to summarily eject the defendant from an action, without a trial or other determination therein, wherein such defendant has raised an issue of fact. Nothing short of a trial and determination of the issues in that action will serve to answer for the right thus obtained.
It is said that the decision of this court in refusing to stay the proceedings upon the report of the referee adjudicated such question in favor of the plaintiff, and that the subsequent confirmation of the report of the referee by this court was an adjudication that the Hoffman House, New York, had no farther interest or rights in the intervention proceeding in the action. Such view is fallacious. We were unable to see upon either motion any ground for a stay of those proceedings, or discover wherein or how the Hoffman House, New York, could obtain any further rights than it already had obtained by a continuance of such proceeding. *Those considerations, however, were reasons why the proceeding should not be stayed, and why the motion for confirmation should be granted, but neither decision assumed to determine the rights of the defendant in the intervention proceeding. Nor could it so determine, because such questions were not before it. It had the right and authority to determine the proceeding so far as the questions were presented, and this it did by the denial of the motion in one case, and the confirmation of the report of the referee in the other; but such determination had no more effect upon the right of this defendant in the action in which it had intervened than though they had never been decided, or the questions presented. It may be that the Hoffman House, New York, will take nothing that it has not already had the benefit of out of the continuance of the proceeding in the foreclosure action. It may be that it will establish the existence of equities therein which are substantial, and which it has the right to have allowed, and which have not yet been determined. The merits of its claims in that connection are not now before us for discussion. The power of the court to summarily put an end to its rights is, and upon that question we reach and 123 New York State Reporter the conclusion that the court was without power to make the order which it did.
It follows that the order should be reversed, with $10 costs and disbursements, and the motion denied, with $10 costs. All concur, except VAN BRUNT, P. J., and PATTERSON, J., who dissent.
(96 App. Div. 52.)
WELSBACH CO. V. NORWICH GAS & ELECTRIC CO.
(Supreme Court, Appellate Division, Third Department. June 30, 1904.) 1. FOREIGN CORPORATIONS–CERTIFICATES-CONDITIONS PRECEDENT-ACTIONS
Under the general corporation law (Laws 1892, p. 1805, c. 687), as amended by La 1901, p. 1364, c. 558, providing that no foreign corporation shall maintain an action in the state on any contract made by it in the state unless it has procured a certificate from the Secretary of State entitling it to do business in the state, the procuring of the certificate is a condition precedent, which must be averred in the complaint.
Chase, J., dissenting. Appeal from Special Term.
Action by the Welsbach Company against the Norwich Gas & Electric Company. From an order and interlocutory judgment overruling the demurrer, with costs, and granting final judgment unless plaintiff, within a certain time, answered the complaint and paid the costs, defendant appeals. Reversed.
The complaint in this action substantially sets forth that the plaintiff is a foreign corporation created by and under the laws of New Jersey, and that it has an office and officers in the state of New York; that the defendant is a domestic corporation doing business in the village of Norwich, state of New York; that at three different dates therein particularly specified, between November 12, 1901, and January 10, 1903, the plaintiff, at Norwich aforesaid, sold and delivered to the defendant three separate bills of goods, which at agreed prices amounted in all to $171:55, and for which amount and interest judg. ment is asked against the defendant. To this complaint the defendant demurred upon two grounds: First, that the plaintiff has not legal capacity to sue; second, that the complaint does not state facts sufficient to constitute a cause of action. At Special Term an order was entered overruling the demurrer. Upon such order an interlocutory judgment was entered overruling the demurrer, with costs, and granting final judgment unless the plaintiff, within 20 days, etc., answer the complaint and pay said costs. From such order and interlocutory judgment this appeal is taken.
Argued before PARKER, P. J., and SMITH, CHASE, CHESTER, and HOUGHTON, JJ.
Judson A. Gibson and C. Tracey Stagg, for appellant.
PARKER, P. J. Section 15 of the general corporation law (Laws 1892, p. 1805, c. 687), as amended by chapter 558, p. 1364, of the Laws of 1901, among other things, substantially provides that no foreign stock corporation, other than a moneyed corporation, shall do business in this state without having first procured from the Secretary of State a certificate that it has complied with all the requirements of law to authorize it to do business, etc.; also that no such corporation shall maintain any action in this state upon any contract made by it in this state unless prior to the making of such contract it shall have procured such certificate. This demurrer is based upon the theory that the complaint should have contained an averment that such certificate had been procured before the making of the sales which are the basis of the action.
1 1. See Corporations, vol. 12, Cent. Dig. $ 2647.
In Reining v. City of Buffalo, 102 N. Y. 308, 310, 6 N. E. 792, the question presented was whether the complaint in an action against that city must contain an averment that the claim declared on had been presented to the common council, and that 40 days had expired since such presentation. It was there held that the language of the charter which required such a presentation and expiration of time before the bringing of an action, and which language is quoted in the opinion, was intended to operate as a condition precedent to the commencement of an action, and not simply to furnish a defense to the city in case of an omission to make such a demand. And because it was so intended, and did so operate, it was held that such presentation, and expiration of 40 days thereafter, should have been averred in the complaint. The demurrer by the city that such complaint did not state facts sufficient to constitute a cause of action was there sustained by the Court of Appeals. Within the principles in that case enunciated, the complaint in the appeal now before us is clearly bad. As in that case, the statute "absolutely forbids” the maintenance of an action on any contract made by the plaintiff in this state unless the requisite certificate had been previously procured. It appears from the complaint that the plaintiff is within the category of those parties who must have procured the certificate before they made the contract, in order to sustain an action thereon. The intent that the procurement of such certificate before the contraci was made shall be a condition precedent to the maintaining an action thereon is as plain as any language could make it-certainly as plain as is the language in the Buffalo charter above referred toand hence, being a condition precedent, it is a fact necessary to be proven, and therefore necessary to be alleged, within the authority of the above case.
The respondent's counsel urges that all the facts necessary to constitute a cause of action at common law are set forth in this complaint, but that does not meet the situation. As said by Judge Ruger in the Reining Case:
"It is competent for them (the Legislature] to attach a condition to the maintenance of a common-law action, as well as one created by statute; and, when they have done so, its averment and proof cannot safely be omitted."
See, also, Thrall v. Cuba Village, 88 App. Div. 410, 84 N. Y. Supp. 661, and Jewell v. City of Ithaca, 72 App. Div. 220,76 N. Y. Supp. 126.
It is to be noticed that by the amendment of 1901 the enforcement of a contract made by a foreign corporation before it has obtained the and 123 New York State Reporter required certificate is entirely abrogated. It is made incapable of enforcement, because of the omission to procure the certificate before the contract was made. In this respect it differs from the statute construed in Fuller Co. v. Schrenk, 58 App. Div. 222–225, 68 N. Y. Supp. 781, and also from that construed in the opinion of the court in Parmele Co. v. Haas, 171 N. Y. 581, 64 N. E. 440. In the latter case it does not appear that any condition precedent on the part of the plaintiff existed at the time of the bringing of the action, because there the plaintiff had 13 months from the time of beginning business within the state in which to procure the required receipt, and it does not appear in the complaint that such time had expired. Thus the necessity of pleading the performance of a condition precedent was not presented in that case, and I am of the opinion that the decision there is not in conflict with the decision in the Reining Case.
I am of the opinion that, under the authority of the latter case, this demurrer was well taken, and should have been sustained. Therefore the order and judgment appealed from must be reversed, and the demurrer sustained, with costs.
Order and judgment appealed from reversed, and demurrer sustained, with costs of the trial in the court below and of this appeal, and with leave to the plaintiff to amend its complaint within 20 days from the service of a certified copy of this order on payment of such costs. All concur (HOUGHTON, J., in result), except CHASE, J., dissenting in memorandum.
CHASE, J. I dissent on the ground that the language of the opinion in the Court of Appeals in C. R. Parmele Co. v. Haas, 171 N. Y. 579, 64 N. E. 440, concurred in by the entire court, is applicable to this case, and should be controlling upon the courts until it is disapproved by that court, and by it held to be unnecessary to the decision in that case.
See, also, Nicoll v. Clark, 13 Misc. Rep. 128, 34 N. Y. Supp. 159; O'Reilly, Skelly & Fogarty Co. v. Greene, 17 Misc. Rep. 302, 40 N. Y. Supp. 360; s. C., 18 Misc. Rep. 423, 41 N. Y. Supp. 1056; Fuller & Co. v. Schrenk, 58 App. Div. 222, 68 N. Y. Supp. 781.
VAIL V. BLUMENTHAL
(City Court of New York, Special Term. March 5, 1903.) 1. MUNICIPAL COURT PRACTICE-REMOVAL OF CAUSE-NEW PLEADINGS.
Under Laws 1902, p. 1490, c. 580, $ 3, providing that a defendant in the Municipal Court may, after issue is joined, and before an adjournment, apply for an order removing the action, the pleadings remain the same after removal, unless amendment is allowed; and, where a case was removed after issue was joined by answer, plaintiff was not entitled to con'sideration of a demurrer to the new matter in the answer. Action by one Vail against one Blumenthal. Removed from the Municipal Court. On objection to consideration of plaintiff's demurrer to new matter in the answer. Objection sustained.
Baldwin & White, for plaintiff.
O'DWYER, J. In the Municipal Court a written, verified complaint was served, and a written, verified answer interposed thereto. The action was then removed to this court pursuant to section 3, c. 580, p. 1490, Laws 1902. That statute provides that "the defendant may, after issue is joined and before an adjournment
for an order removing the action." Upon the removal of an action from the Municipal Court to this court, the pleadings remain the same, unless amendment thereof be allowed. In this case, after the same had been removed to this court, plaintiff served a written demurrer to the new matter contained in the answer, describing the same as a defense, and to the counterclaim contained in said answer. The issue of law attempted to be thus joined has been brought on for trial by plaintiff, and defendant objects to a consideration thereof upon the ground that the demurrer was not interposed in the Municipal Court, and that the service thereof, without leave of this court, is improper and of no effect. The objection is sustained. The issue must be joined before the action is removed, and may not be changed. The pleadings in the Municipal Court cannot be amended, except by permission, and then only to the extent allowed in the lower court. The demurrer served herein is an additional pleading, creating a different issue from that joined in the Municipal Court, and is not an amendment with permission of any pleading in that court.
Demurrer dismissed, with $10 costs. Settle order hereon on one day's notice.