(182 N.Y.S.)

PEOPLE ex rel. PRIOR v. PRIOR.

(Supreme Court, Special Term for Motions, Kings County. June 22, 1920.) Habeas corpus ~93-Court cannot direct father to make money provision for child in custody of mother. Domestic Relations Law, § 70, permitting a parent to apply for a writ of habeas corpus and the court to award the custody of a child to either parent, does not authorize the court, nor has it inherent power, to direct the father, on custody being awarded the mother, to make a money provision for the support of the child, even with the consent of the father.

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Proceeding by the People, on the relation of Albert S. Prior, against Edith P. Prior. Application to. punish relator for contempt. Motion denied.

George E. Miner, of New York City, for relator.

Frank Harvey Field, of New York City, for respondent.

LAZANSKY, J. Application to punish a husband for contempt in failing to obey that part of an order made under section 70 of the Domestic Relations Law (Consol. Laws, c. 14), which required the payment by the father to the mother of a certain sum of money for the support and maintenance of a child of the parties. At the time of the granting of the original order, which has been several times amended, the parties lived separate and apart. One of the answers of the husband to the motion is that the court had no jurisdiction in this proceeding to make an order providing for the payment by him of a sum of money for the maintenance and support of his child, even though the father consented to the order. Every justice, who has presided at ex parte, either knows or has made use of the practice of providing for the support of an infant, where in a proceeding brought under this section the award of the custody has been made to the mother. The practice seems to have given satisfaction. As far as I have been able to ascertain, no such order has ever been attacked for want of power.

In my opinion this enactment does not confer upon the court the power to make a money award, even if it be assumed the Legislature has the right to confer such a power upon the courts. It will be observed that the charge and custody of the child are awarded to a parent under such regulations and restrictions, and with such provisions and directions, as the case may require. In other words, the person into whose custody the child is given must take the child under such regulations and restrictions and with such provisions and directions as the case may require. The language does not, in my opinion, warrant the claim that it empowers the court to direct the father to make a money provision. Since the court has no power under the statute to make a money provision, the question arises as to whether or not there is an inherent power in the court to make such a provision. The original statute was enacted in 1830. It then provided for a petition by the wife alone, for then the father was deemed the

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes 182 N.Y.S.-37

legal guardian. In 1896 the husband was also authorized to make the petition. Prior to its enactment the court, under a writ of habeas corpus, had no power to decide the question of custody of a child as between husband and wife. Under such a writ the only question involved was unlawful restraint. Of course, in cases of improper guardianship, the court would take the child away from the improper influence, and was therefore compelled to make some disposition of the child. This, in effect, decided the question of custody.

But the court never proceeded upon the basis of deciding that question. This statute, however, gave the court the power to decide the question of custody under a writ of habeas corpus on the application of the wife, and thereafter, by amendment, on the application of the husband. Of course, as parens patriæ, a court of equity, either by petition or by action, always asserted its power to determine a question of custody or guardianship of an infant. The foregoing views are considered in Matter of Wollstonecraft, 4 John. Ch. 80; People v. Mercein, 8 Paige's Ch. 46; People ex rel. Sampson v. N. Y. C. Protectory, 93 App. Div. 196, 87 N. Y. Supp. 557; Matter of Knowack, 158 N. Y. 482, 53 N. E. 676, 44 L. R. A. 699; Wellsley v. Duke of Beaufort, 2 Bligh's New Reps. 124; People v. Brooks, 35 Barb. 85; People v. Chegaray, 18 Wend. 637; People v. Sternberger, 12 App. Div. 398, 42 N. Y. Supp. 423. Aside from statutory enactment, however, the court surely has no power under a writ of habeas corpus to make a money award. Attention has not been called to a case in this state where a court of law or equity has undertaken to make a money provision for the support of a child, except in matrimonial actions. There is authority to the contrary. Matter of Ryder, 11 Paige's Ch. 185, 42 Am. Dec. 109. It has also been held in a sister state that an action will not lie at the instance of a child to compel a father to support it. Huke v. Huke, 44 Mo. App. 308.

I conclude, therefore, that there is no inherent power in the court to make any such money provision. The only legal method to compel a father to support his child will be found in the Inferior Criminal Courts Act, and indirectly by action against the father for necessaries furnished to the child. Since, therefore, the statute does not confer the power, and the court has not the inherent power to make an award of money, my conclusion is that that part of the order was made without jurisdiction. Such jurisdiction could not be conferred by consent of the parties.

The motion must be denied. No costs.

(191 App. Div. 854)

(182 N.Y.S.)

GOUERT v. MECHANICS & METALS NAT. BANK OF CITY OF NEW YORK et al.

(Supreme Court, Appellate Division, First Department. May 14, 1920.)

1. Judgment 707-Conclusively determines question as between parties only.

A judgment conclusively determines all questions between plaintiff and defendant, but does not determine any question between plaintiff and one not a party.

2. Judgment 632-No right conferred on one not party to action.

Judgment in prior action, to which plaintiff was not a party, though not binding adjudication on her, and though it left her free to pursue any remedy she had against either plaintiff or defendant in such prior action, gave her no right against either of them which she did not previously possess.

3. Corporations

474-Pledgee in good faith may sell pledged bonds of third

person, despite fraud of pledgor.

Where plaintiff delivered bonds to a firm of stockbrokers, that they might include them in their schedule of assets on examination by a Stock Exchange, and the brokers instead pledged them with a bank as security for indebtedness, the bank, taking the bonds in good faith and without any knowledge of the fraud of the brokers, had a right to sell them and apply the proceeds on the indebtedness of the brokers.

4. Corporations 474-Third persons, whose bonds were wrongfully pledged, may insist that securities rightfully pledged be first applied.

Bonds were left with stockbrokers in order that they might report them among their assets on examination by a Stock Exchange. They wrongfully pledged the bonds, along with securities of other persons, to a bank as security for their indebtedness. The bank had no knowledge of the brokers' fraud. Held, that the sole right of the owners of the bonds was to require that the other securities, which had been rightfully pledged with the consent of the owners, should be first applied by the bank in satisfaction of the brokers' indebtedness.

5. Judgment 662-Conclusiveness and effect of judgment as affected by pendency of proceedings for relief against enforcement.

Stockbrokers wrongfully pledged plaintiff's bonds, and rightfully pledged securities of a customer carried on margin. The customer secured judgment against the pledgee bank for delivery to him of all the securities on tender of balance due on the brokers' indebtedness to the bank, but, before delivery of the securities to the customer, plaintiff, whose bonds had been wrongfully pledged, secured injunction restraining payment of any balance to the customer, or delivery of the securities to him on payment of the balance remaining due on the indebtedness, on condition she give bond to pay any damages to the customer, a privilege of which she failed to avail herself. The bank, on tender by the customer of the balance due, delivered the securities to him under the compulsion of his judgment against it. Held, that such delivery did not render the bank liable to plaintiff, but that the customer took the stock from the bank subject to plaintiff's claim.

Appeal from Special Term, New York County.

Action by Maybelle D. Gouert against the Mechanics & Metals National Bank of the City of New York and others. From a judgment. for plaintiff, defendant Bank appeals. Judgment reversed, in so far as inconsistent with the opinion, and judgment entered, dismissing the complaint as against defendant Bank, etc.

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes

See, also, 95 Misc. Rep. 374, 158 N. Y. Supp. 869; 176 App. Div. 507, 163 N. Y. Supp. 311.

Argued before DOWLING, LAUGHLIN, PAGE, and MERRELL, JJ.

Frank M. Patterson, of New York City (Franklin H. Mills, of New York City, on the brief), for appellant.

House, Grossman & Vorhaus, of New York City (Francis M. Scott, of New York City, of counsel, and Joseph Fischer and David Vorhaus, both of New York City, on the brief), for respondent.

PAGE, J. As this case is so closely connected with that of Fisher against the defendant bank, a somewhat detailed statement of facts is necessary to the proper understanding of the present case:

Prior to May 18, 1914, defendants Stoppani and Hotchkin were a firm of stockbrokers engaged in business in New York City. For several years prior to May 18, 1914, the firm of Stoppani & Hotchkin kept an account with the defendant bank, and from time to time borrowed money on collateral securities pledged by the firm with the bank. These loans were made under a collateral loan agreement, entered into between the firm and the bank on February 15, 1910, which recited the intention of the firm to borrow money from the bank from time to time and to pledge property as collateral security therefor, provided that all property pledged or delivered to the bank should be collateral security for the payment of such loan and any other obligations of the firm to the bank, and gave the bank full power to sell such security and apply the proceeds to the liability of the firm. Between March 31, 1910, and May 18, 1914, the defendant Fisher traded with Stoppani & Hotchkin upon a general speculative and margin account. Fisher's order Stoppani & Hotchkin bought and sold securities on margin. On May 18, 1914, there was due on this account from Fisher to Stoppani & Hotchkin the sum of $6,639.04. On May 14, 1913, defend ant Fisher delivered to Stoppani & Hotchkin the following instrument: "Consent is hereby given that all securities now carried or that may be carried on margin by Stoppani & Hotchkin for account and risk of the undersigned, and any securities deposited or that may be deposited to protect said margin account, may be loaned by said Stoppani & Hotchkin, or may be pledged by them, either separately or together with other securities, either for the sum due thereon to said Stoppani & Hotchkin or for any greater sum, all without any further notice, saving the right of the undersigned to have control and to take up said securities at any time upon payment of balance due, as provided in chapter 500, Laws 1913."

On

On March 8, 1913, Stoppani & Hotchkin, who held as collateral to secure Fisher's account 100 shares North American Company stock, $3,000 Brooklyn Rapid Transit Company bonds, and 100 shares United States Rubber Company first preferred stock, pledged and delivered such securities to defendant bank to secure the general indebtedness of the firm to the bank under the collateral loan agreement. On August 18, 1913, the firm pledged and delivered to the bank, for the same purpose, 100 shares American Smelting & Refining Company stock, which it had also held as collateral for Fisher's account. On Febru

(182 N.Y.S.)

ary 24, 1914, plaintiff loaned and delivered to Stoppani & Hotchkin 4 New York City coupon bonds and 6 United States Steel Company coupon bonds, all payable to bearer. This was done upon the representation and understanding that the bonds were to be shown as assets of the firm to a committee of the Consolidated Stock Exchange of New York City, which was about to examine the firm's books, for the purpose of permitting the firm to represent to the committee that the bonds were the firm's property, to enable the firm to make a more favorable showing of assets, and upon the firm's promise and agreement that the securities would be safely kept in its possession and would be returned to plaintiff on demand. At that time plaintiff did not have a trading or speculative account with the firm, and was not indebted to the firm or its members; nor did she borrow any money from them on that day on the bonds. The learned court at Special Term has found that these securities "were not delivered * * * for any purpose, except to give the temporary custody thereof to said firm." This finding would seem to be inconsistent with the finding that they were delivered for the purpose of permitting the firm to represent to the committee that the bonds were the firm's property, but it should be understood to refer to the relations between the plaintiff and the defendant, and if it is inconsistent with the preceding finding the appellant is entitled to the benefit of the more favorable finding.

On the same day that Stoppani & Hotchkin received the bonds they pledged and delivered them to the defendant bank to secure the general indebtedness of the firm to the bank under the collateral loan agreement. On May 18, 1914, Stoppani & Hotchkin, individually and as partners, made an assignment for the benefit of their creditors to the defendant Gilbert, who qualified and acted as assignee, and thereafter qualified and is now acting as trustee in a bankruptcy proceeding instituted against the firm and its members.

On May 18, 1914, the firm of Stoppani & Hotchkin was indebted to defendant bank in the sum of $49,000, for money loaned by the bank to the firm pursuant to the loan agreement. As collateral for this indebtedness the bank held the stock which had been pledged with Stoppani & Hotchkin as collateral to secure Fisher's account, the bonds of this plaintiff, together with certain other bonds and stocks. The amount of the indebtedness was loaned by the bank to Stoppani & Hotchkin by reason of and in reliance upon the securities mentioned, which the bank received in the ordinary and usual course of business, with the belief that Stoppani & Hotchkin were the owners and rightful holders, and had full authority to pledge, transfer, or otherwise dispose of them, and without any knowledge of any fraud practiced upon the plaintiff by said firm of Stoppani & Hotchkin.

The loan was not paid, and it became necessary for the bank to resort to the securities. On May 26, 1914, the bank made a sale of the plaintiff's bonds, of the $3,000 Brooklyn Rapid Transit bonds, and 100 shares of the United States Rubber first preferred stock belonging to Fisher, and certain other stocks and bonds. The aggregate net proceeds of these sales amounted to $43,326.93, which was applied on the loan of Stoppani & Hotchkin, leaving an indebtedness of $5,