Barasch v. Kramer

Giegerich, J. The action is to recover damages for breach of warranty of title upon the sale by the defendants to the plaintiff of certain laundry tubs contained in the premises No. 319 East Seventy-fifth street in the borough of Manhattan, Hew York city. The case was submitted upon stipulations and concessions made in open court, from which the following appear to be the material and undisputed facts. On February 28, 1903, one Lottie Kurzynsky was the cwner of the premises in question and entered into an agreement with the Union Granite Company, by which the latter made a conditional sale of certain laundry tubs which were afterward installed in the house and still remained there at the time of the trial of this action. By that agreement the purchaser undertook to pay for the tubs within sixty days after their delivery, and title was to remain in the vendor until final payment. On March 8, 1903, this agreement was duly filed in the office of the register of the county of Hew York, and it was duly refiled on or before March 8, 1904. Subsequently to March 8, 1904, but within a year thereafter, the vendor of the tubs, or its assignee, commenced an action against the purchaser and the then owner of the premises to recover the tubs or their value. On February 16, 1905, after several mesne conveyances, the defendants became the owners of the premises for value and without notice of the pending action or the claims upon which it was based. On October 17, 1905, the plaintiff entered into an agreement in writing with the defendants for the purchase of [478] the premises in question for a certain price, and .this contract provided that the sale was to include “ all personal property contained in said premises and used in connection, therewith.” On December 1, 1905, the defendants, in pursuance of the contract just mentioned, conveyed the premises and their appurtenances to the plaintiff by a full covenant warranty deed, the tubs being then installed in the house. Thereafter the plaintiff entered into a contract of sale, similar in its terms to the one last mentioned, with' one Fannie Weinfeld and later conveyed the premises and their appurtenances to her by a full covenant warranty deed; and she was still the owner when this action was commenced. ¡Neither the plaintiff nor Mrs. Weinfeld had any knowledge or notice of the then pending .action in replevin to recover the tubs when they took title, and both were tona fide purchasers for value. On October 15, 1906, and subsequently to the conveyance to the present owner, Mrs. Weinfeld, judgment was entered in the replevin action in favor of the plaintiff therein for the recovery of the tubs or their value. This judgment was entered upon the default of the defendants in the action, who had answered, but did not appear when the cause was called for trial. The defendants in this action were not parties tó the replevin action. Thereafter execution was issued upon the judgment in the replevin action; and the present owner of the property, Fannie Weinfeld, in order to prevent the removal of the tubs, paid to the sheriff the sum of'$'150 which, upon her demand, the present plaintiff repaid to her. The value of the tubs was at all times $143. Upon these facts the trial court gave judgment in favor of the plaintiff for $143' and costs, and I think it is obvious that the judgment must be reversed. The record does not inform us whether the tubs were in any way affixed to the realty to enable us to judge whether, as between grantor and grantee, they would' pass "by a conveyance of the land. If so, they were covered by the cove479 rants in the deeds and, if not, a warranty of title would he implied upon their sale, as personal property, so that the same result would follow in either case upon a failure of the title. But the difficulty with this case is that there is no competent evidence that the defendants’ title was defective. The judgment in the replevin action, which was recovered in the Supreme Court, is not evidence against them; and their counsel so insisted on the trial. The plaintiff’s counsel argues that the judgment was admissible against the defendants and cites 21 American and English Encyclopedia of Law (1st ed.), page 139, which lays down the principie that, “ Every person is privy to a judgment who has succeeded to an estate or interest held by one who was a party to the judgment, this succession talcing place after the bringing of the action.” The rule so laid down is not the law in this State and would be a harsh and illogical rule in any State having a practice similar to ours where, in courts of record, the action is commenced by a summons which is issued, not out of court, but out of an attorney’s office, and of which no record is - made in the office of the clerk of the court, and which is followed by a complaint which need not be filed and, as a matter of fact in the vast majority of cases, is not filed until the judgment-roll is made up, notwithstanding the imperative form of the provisions of section 824 of the Code of Civil Procedure, which requires the filing of the summons and of each pleading in an action within ten days after the service thereof. There is no penalty for a failure to comply with such direction, however; and it is a matter of common knowledge that both the summons and the complaint are retained in the office of the plaintiff’s attorney until the judgment-roll is made up when, for the first time, they are filed in court. When actions could be commenced only by process issued out of the court and a record was made of such process, and when the pleadings were required to be filed and were filed in the court, it was entirely fair to charge a purchaser of personal property with notice that a suit affecting the title to such property had been commenced against his vendor. [480] Under our present method of practice, however, the facts on which such a rule was based have ceased to exist; and, for the reasons pointed out and discussed at great length in Leitch v. Wells, 48 N Y, 585, that old common-law rule is not in force in this State and no Us pendens is created which will bind a purchaser to a judgment in a suit, unless there be a process and a bill or complaint on file in which the claim upon the property is set forth. Further on the question of privity see Campbell v. Hall, 16 N. Y. 575; Zoeller v. Riley, 100 id. 102; Hasten v. Olcott, 101 id. 153. It is a part of the case of the one seeking to introduce a judgment as evidence to show the filing of the summons and complaint (Leitch v. Wells, supra, 612), prior to the date of the acquisition of title by the purchaser against whom the judgment is sought to be introduced in evidence. Furthermore, the plaintiff’s counsel expressly restricted the purpose for which he offered the judgment in evidence to showing “ that there was made upon him (plaintiff) a demand; that he had reasonable cause to believe that he or his subsequent grantee, to whom he had given a deed, would be imperiled or prejudiced in his rights; and it is offered merely and only for the purpose of proving that plaintiff had reasonable ground to believe that his claim or title had been attacked and could pay the claim.” While the plaintiff, undoubtedly, had the right to satisfy the claim of his grantee without awaiting legal action to compel such satisfaction and could recover from his grantor provided the latter’s title was in fact bad (Sweetman v. Prince, 26 N. Y. 224, 232; Burt v. Dewey, 40 id. 283, 286; Bordwell v. Collie, 45 id. 494, 497), the question is, not what he believed or had reasonable cause to believe, but what the fact was; and the plaintiff must affirmatively establish the defect in his grantor’s title by independent proof, wffien that grantor was neither a party to a prior action in which the question was determined nor called in to aid in its defense. Id. The respondent appears to place some reliance upon section 115 of the Lien Law (Laws of 1897, chap. 418), which was in effect at the time of the transaction in question and [481] which provides that the sections relating to the filing of certain conditional bills of sale shall have no application to a conditional sale of household goods, “ if the contract for the sale thereof is executed in duplicate and one duplicate thereof delivered to the purchaser,” which delivery of a duplicate was admittedly made in this case. Conceding all this, however, does not help the plaintiff’s case. The question of fact would still remain, whether the title continued in the vendor or whether it had passed to the vendee through the performance by the latter of the condition of the bill of sale above referred to that payment should be made within sixty days after the delivery of the articles and that title was to remain in the vendor until final payment. The only effect of the proper filing of the conditional bill of sale in an ordinary case, or of the delivery of a duplicate in the cases provided for under section 115 above referred to, is to save the bill of sale from the rule which would otherwise render it invalid against subsequent purchasers regardless of what its merits might otherwise be. The effect of such recording or such delivery of a duplicate is not to establish either the existence or the validity of the conditional bill of sale upon the merits, but simply to leave the matter open to proof upon the merits. The next question that arises, therefore, is what presumption is to be indulged in in a case of this kind, where a contract to which both the plaintiff and the defendants are strangers is introduced in evidence, and where the terms of that contract bind the purchaser to pay for the goods within sixty days and that title shall remain in the seller until final payment. I think the inference which ought to be drawn under such circumstances is that the contract between such strangers was performed, and that payment was made as agreed upon, and that the title passed out of the vendor into the vendee. The lack of evidence on this point is not supplied by the judgment in the replevin action, because that was offered, in the language of the plaintiff’s counsel used at the time it was admitted in evidence, “ merely and only for the purpose of proving that he (the plaintiff) had reasonable ground to [482] believe that his claim or title had been attacked, and that he had reasonable ground to pay the claim.” We do net now have to pass upon the question whether, if the judgment had been offered and admitted for all purposes, it would have been binding upon the defendants upon any theory of notice of the pendency of the action by reason of the provisions of chapter 503 of the Laws of 1905, which, in repealing section 115 above referred to, expressly provided that such repeal should not affect any action or proceeding pending at the time the repeal took effect, which was on September 1, 1905, on which date the said replevin action, as aboye shown, was pending. As the judgment was offered only for a limited purpose, the defendants were entitled to rely upon its effect being similarly limited, both in the court below and on appeal. It is manifest that any other rule would lead to surprise a'nd injustice. My conclusion is that neither the fact of the delivery of the duplicate conditional bill of sale to the purchaser nor the judgment rendered in the replevin action, limited as the latter was in the purpose for which it was admitted, affords any evidence that there was a breach of warranty of title on the part of the defendants; and the judgment must, therefore, be reversed and a new trial ordered, with costs to the appellants to abide the event.