People v. New York & Manhattan Beach Railway Co.

Dykman, J.: The obstacles in the way of the plaintiff in this action are numerous and insurmountable. In the first place there is nothing in the-history or language of the law of 1815 (ch. 49), under which it is instituted, which makes that statute applicable thereto. Frauds of stupendous magnitude and enormity had been perpetrated by certain municipal officers and their confederates in the city of New York,, and a civil action for the recovery of the money and funds fraudulently diverted, set on foot in the name of the people of the State-of New York, was defeated by a decision of our highest appellate tribunal against its maintenance. Then,' for the purpose of enabling the people to sustain a civil action against State,, county, town and municipal officers for malfeasance, to reclaim, money and property tortiously and fraudulently appropriated, the-law of 18Y5 was enacted, providing that where any money, funds, credit or property, held or owned by this State, or held or owned! officially, or otherwise, for or on behalf of any public or government interest, by any municipal or other public corporation, board, officer, custodian, agency or agent of any city, county, village or other division, subdivision, department or portion of this State, has heretofore, without right been obtained, recovered, converted or disposed of, and not actually recovered back and restored prior to the passage of this act, unto-the proper and lawful official, receiver, depositary or custodian [99] thereof, either in specie or by full and lawful compensation for the same duly made, or where such money, funds, credit or property shall be hereafter without right obtained, received, converted or disposed of, the people of this State have in every such case and shall have a right of action for the same and for any damages, or other compensation due recoverable or that might be had on account or by reason of such obtaining receipt, conversion or disposition, notwithstanding a right of action may exist by law, for the same^ cause in some public authority other than the State, and although an action therefor may be pending. This is sufficient for a comprehension of the scope and intention of the law, so far as concerns actions under it. Without verbiage or repetition the plain provision is that, where money or property held or owned officially or otherwise, for any public or governmental interest by any public corporation, board, officer, custodian or agent of any portion or subdivision of the State shall, without fight, be received, converted or disposed of, the people of the State shall have a right of action for the same and for damages. Here was no property held by an officer, custodian or agent, and no conversion thereof by any person sustaining that relation. The allegations of the complaint are that the land in question was the property of the town of Gravesend, that the defendant first obtained possession of it and then improperly procured the passage of a resolution by the annual town meeting of the town, for a valuation of the property and a sale and conveyance thereof to the defendant, which resolution was carried into execution by a conveyance to the-defendant and the payment of the appraised valuation. The specific wrong complained of is the packing of the town-meeting with spurious and fraudulent voters, and thus giving a false direction to the action of that, body, detrimental to the interests of the town. This was clearly ill and wrong, but not the kind of evil intended to be redressed-under the statute of 1875. It is the case-of an improvident disposition by a town of its real property through, the instrumentality of a town meeting controlled by unjustifiable influences. There may be redress for such a wrong, but it does nofe lie in the remedy the plaintiff has pursued. It is quite true that under our political system a town has many [100] of the attributes of a corporation, but it does not follow that because such a bod), makes an improvident disposition of its property, even though the same is induced by fraud or wrong, a restoration can be procured by an action in the name of the people, under this statute. The -statute has relation to wrong, frauds and conversions perpetrated by a corporation or natural person sustaining some fiduciary relation to the true owner, not to dispositions of property by the owner, even though influenced and obtained by fraud. In the next place, the town of Gravesend is a necessary party to this action. The statute of 1875 provides, beyond what has already been quoted, that on the commencement of any action or judicial proceeding under it for the recovery of money or property by the State, all such money and property, if not so previously vested, shall then forthwith be vested in the people of the State of New York, and are by force of such suit, action or judicial proceeding, and of this act, transferred to and vested in the people of the State. This portion of the statute proposes to take private property either of an individual or a corporation and transfer it to the State without compensation, in violation of the provisions of the Constitution in that behalf. If given any operation in this case, it would transfer the property in question to the State and vest the title thereof in the people. If made a party to this action, the town may raise objection to this disposition of the property, or it may acquiesce therein, as any party may waive a constitutional provision existing for his benefit. Not being a party to the action, none of the proceedings therein will have any binding force against the town. True it is, that section 3 of the act gives power to the court to make such order and judgment as may be just and equitable for the disposition of the proceeds of any recovery in the action, so as to reinstate the lawful custody which was disturbed by the wrong complained of, whether the true owner was a party to the action or not, and it has been contended that it was not the intention of the law of 1875 to deprive the owner of any property, but to devise a .remedy for its recovery. This latter view seems to give but small force to the intention [101] of section 1 of the law, as expressed in plain language, but it is not essential to examine it further now. Another plain reason why the town should be made a party to this action, is this. The sale of this property, though induced by fraud, was not absolutely void, but voidable only, at the option of the town, the defrauded party. It may be that the town elects to affirm the transaction, and that can only be determined in this action by making the town a party thereto and thus presenting the opportunity to repudiate or affirm the sale and conveyance. (Matteawan Company v. Bentley, 13 Barb., 641; Baker v. Robins, 2 Denio, 138; Cobb v. Hatfield, 46 N. Y., 533.) Another reason why this action cannot be sustained, is that if the town elects to disaffirm the sale, before any measures can be adopted in that direction, whatever has been received in pursuance of it must first be restored. There is no rule of law or justice that will permit the State to take the property in question from the defendants, while the town holds on to the money which they paid for it. The sale and conveyance remained in full force and operation until disaffirmance and restoration by the town. (See cases last cited.) The judgment must be reversed, with costs and disbursements. Barnard, P. I., concurred; Gilbert, J., not sitting. Judgment reversed, and judgment for defendant, with costs, unless the plaintiff amend in twenty days, on payment of costs.