Shubert v. Buck

Per Curiam. The plaintiffs, as receivers of Shubert Theatre Corporation, brought this action on a promissory note, in bearer form, held by them as such receivers. The answer admits the execution and non-payment of the note but sets up four defenses, one being also designated a counterclaim. On motion by plaintiffs the court struck out all the defenses and the counterclaim. The first defense adequately sets forth that there was no consideration for the note and the defense is, therefore, sufficient. (Ellis v. Keeler, 126 App. Div. 343; California Packing Corp. v. Kelly S. & D. Co., 228 N. Y. 49; Donnelly v. Bauder, 217 App. Div. 59; Zebold v. Hurst, 65 Okla. 248; 166 Pac. 99.) The second defense is a mere conclusion. It states that notwithstanding his agreement with the defendant, entered into simultaneously with the execution of said notes or either of them, the plaintiff Lee Shubert diverted the said notes from the purpose for which they were made, executed and delivered to him, by defendant. There are no facts set forth to show by what means these notes were diverted from the purpose for which they were made. This defense is clearly insufficient. The third defense is stated by the appellant to be either a defense of duress or a defense that the note was delivered upon condition that the maker should not be liable thereon. The facts set forth in this defense clearly show that there was no duress and fail to set forth a defense of conditional delivery. It is alleged that the note was given for a loan of money to be used to pay the salaries of those taking part in a theatrical performance; that the show closed and the defendant had no money with which to pay those taking part and in order to secure such money, the defendant induced the plaintiff Lee Shubert to give him an amount sufficient [245] to pay the members of the cast. The facts pleaded do not constitute a defense of any kind. The fourth alleged defense, as a defense, is worthless. The facts are also pleaded as a counterclaim. When considered most favorably to the defendant the facts allege that the plaintiffs are indebted to the defendant in the sum of $4,050, no part of which has been paid. This pleading sets forth sufficient facts to constitute a counterclaim or setoff against the plaintiffs. The order, therefore, should be modified in so far as to deny the motion to strike out the first defense and the counterclaim, and as so modified affirmed, without costs, with leave to defendant to plead over as to the second defense, if he be so advised, within ten days from service of order. McAvoy, Martin, O'Malley and Townley, JJ., concur; Finch, P. J., dissents in part.