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First Department, May, 1909.

[Vol. 132. ments in searching the title. If it be true that he disaffirms on the ground of fraud, and that he has a right to recover ex contractu upon the implied promise for money had and received, this does not extend to the recovery of money not had and received by the defendant. If the expenses and disbursements are to be recovered it must be by way of damages for the tort.

In the second cause of action, on the failure of defendant to perform, again plaintiff sets up the fees and disbursements and seeks to recover them. In this cause of action it must be upon the theory of a breach by the defendant by way of damages therefor. This being the complaint as plaintiff has framed it, and we must take it as it is and not as it might have been, he has attempted to set up two causes of action, one for damages for fraud and the other for damages for failure to perform a contract. One necessarily implies the non-existence of a contract for fraud ab initio and the other a valid contract and a subsequent breach. Viewed in this light, causes of action are improperly united.

In Kranz v. Lewis (115 App. Div. 106) the first cause of action alleged false representations, down payment of $500 and $132.50 alleged to have been expended in examining the title. "The second cause of action is brought on the contract, i. e., to recover damages for a breach thereof by the defendant by his inability to convey a good title, the damages claimed being the $500 paid on the contract and $132.50 paid for examining the title. If it may be said that they come under subdivision 9 of section 484 of the Code of Civil Procedure, which allows the union of causes of action arising out of the same transaction and not included in any of the preceding subdivisions, the answer is they are not 'consistent with each other,' which is made a requisite in the final paragraph of the section. The first cause of action is not on the contract, but alleges and is based on a rescission of it and a refusal to take title under it for fraudulent representations inducing the defendant to enter into it, while the second alleges and is based on a demand for the deed under the contract and the defendant's breach. One is based on fraud avoiding the contract, and the other on the contract. Their inconsistency is indisputable. Proof of either would destroy the other. The election to rescind a contract for fraud evidenced by the bringing of an action based thereon is irrevocable and prevents

App. Div.]

First Department, May, 1909.

the bringing of an action on the contract itself; and vice versa when the plaintiff has knowledge of the fraud (Pryor v. Foster, 130 N. Y. 171; Genet v. D. & H. C. Co., No. 5, 28 App. Div. 328; Lomb v. Richard, 45 Misc. Rep. 129)."

The same point was involved and the same result reached in Edison Elec. Ill. Co. v. Kalbfleisch Co. (117 App. Div. 842; S. C., 127 id. 298). (See, also, Kaufman v. Morris Bldg. Co., 126 App. Div. 388.) Here are three cases on the precise point involved in the case at bar recently decided by a unanimous court in the Appellate Division, second department. In the absence of overruling considerations they should be followed.

It follows that the judgment appealed from should be affirmed, with costs and disbursements to the respondents, with leave to the appellant upon payment thereof and within twenty days to plead

over.

PATTERSON, P. J., MCLAUGHLIN, LAUGHLIN and HOUGHTON, JJ., concurred.

Judgment affirmed, with costs, with leave to plaintiff to amend on payment of costs.

ROBERT J. MAHONEY, Respondent, v. ROBERT SMITH, Appellant. First Department, May 14, 1909.

Evidence — abandonment of building contract.

In an action to recover for refusal to allow the completion of a building contract in which plaintiff claimed that defendant refused to permit him to complete, and defendant claimed an abandonment of the contract. On all the evidence, held, that it was error to refuse to allow defendant to show that an association, which plaintiff joined during the pendency of the contract, promulgated an order to the effect that its members should not employ any more men than they were then employing, nor deliver or receive any material for any building until further authorized to do so by the governing board of the association.

APPEAL by the defendant, Robert Smith, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 31st day of October, 1907, upon the verdict of a jury, and also from an order entered in

First Department, May, 1909.

[Vol. 132.

said clerk's office on the 25th day of October, 1907, denying the defendant's motion for a new trial made upon the minutes.

Franklin Pierce, for the appellant.

Claude Gignoux, for the respondent. HOUGHTON, J.:

The action is to recover damages for refusal to allow the completion of a building contract made by the plaintiff with the defendant. The plaintiff claims that the defendant refused to permit him to complete and the defendant claims that there was such an abandonment of the contract as justified him in taking possession and reletting.

We are of the opinion that the verdict of the jury in favor of plaintiff is against the weight of evidence upon the question of readiness to fulfill on the part of the plaintiff and proper prosecution of the work on his part. We are also of the opinion that error was committed upon the trial in refusing to receive orders promulgated by the board of governors of the Building Trades Employers Association.

The plaintiff's contract contained a strike clause, and there is evidence that a strike existed for some portion of the month of May. The plaintiff testified that in the month of June he joined the Building Trades Employers Association. The defendant offered to show that that association, shortly after the plaintiff joined it, promulgated an order to the effect that members should not employ any more men than they were then employing nor deliver or receive any material for any building until further authorized to do so by the governing board. If the plaintiff voluntarily joined an association and submitted himself to its directions respecting employment of men or continuance of building operations it had a material bearing upon whether he was performing the contract with defendant with due diligence. The strike clause contained in his contract did not protect him from the consequences of a voluntary lock-out on his part. The defendant's evidence showed that when he protested that the work was not proceeding as it should, the plaintiff gave as an excuse that he belonged to the association and could not employ any more men than he was employing and that because of the

App. Div.]

First Department, May, 1909.

restrictions of the association the work could not proceed more rapidly than it was proceeding. The plaintiff denied this but admitted that he belonged to the association. It was proper as bearing on the probabilities for the defendant to show the orders promulgated by the association and it was then for the plaintiff to prove whether he was obeying or disobeying them, or whether he considered himseif bound by them or not.

The jury has found very substantial damage resulting to the plaintiff from defendant taking possession of the work and refusing to permit plaintiff to complete his contract, and their verdict might have been influenced by proof that plaintiff had voluntarily put himself in a position so that he could not prosecute the work with proper diligence because of his joining the association and the orders which it promulgated.

We think the judgment should be reversed and a new trial granted, with costs to the appellant to abide the event.

PATTERSON, P. J., LAUGHLIN and SCOTT, JJ., concurred; MCLAUGHLIN, J., concurred in result.

Judgment reversed, new trial ordered, costs to appellant to abide event.

JOHN A. WREDE, as Receiver of the Property of WILLIAM S. ALLEY, Appellant, v. FRANKLIN W. GILLEY, as Treasurer of the NEW YORK STOCK EXCHANGE, Impleaded with WILLIAM L. CLARK, as Trustee in Bankruptcy of WILLIAM S. ALLEY, Respondent.

First Department, May 14, 1909.

Supplementary proceeding - title of receiver- bankruptcy - effect on title of receiver-filing claim in bankruptcy - election.

Upon the appointment and qualification of a receiver in supplementary proccedings, he takes the legal title to all the personal property of the judgment debtor, whether in his hands or in the hands of others, as of the date of the service of the order in supplementary proceedings, except as against purchasers in good faith, or a debtor who has paid his debt in good faith.

Where service of an order in supplementary proceedings was made upon the judgment debtor prior to the four months' period prescribed by section 67f of the Bankruptcy Act, within which all legal proceedings shall be deemed null

First Department, May, 1909.

[Vol. 132. and void in case of bankruptcy, although the receiver was appointed and qualified during the four months' period, his title to the judgment debtor's rights relate back to the commencement of the proceedings instituted by service of the order.

The presentation of a claim in the bankruptcy court by the judgment creditor, which states that a judgment had been obtained and execution returned unsatisfied, and that there was no security for the debt, and stating further that a receiver had been appointed in proceedings supplementary to execution, cannot be deemed a surrender of the rights of the plaintiff, or of such title as the receiver obtained, or an election to proceed only in the bankruptcy court. APPEAL by the plaintiff, John A. Wrede, as receiver, etc., from a judgment of the Supreme Court in favor of the defendant, William L. Clark, as trustee, etc., entered in the office of the clerk of the county of New York on the 24th day of December, 1908, upon the decision of the court rendered after a trial at the New York Special Term.

Albert Ritchie, for the appellant.

Albert C. Aubery, for the respondent.

HOUGHTON, J.:

William S. Alley was a member of the New York Stock Exchange and possessed of whatever property rights pertained thereto on the 8th day of November, 1906, when an order in supplementary proceedings was served upon him in behalf of William Oothout, a judgment creditor to the extent of upwards of $23,000, upon whose judgment execution had been duly issued and returned unsatisfied. These proceedings supplementary to execution culminated in the appointment of a receiver and his qualification on the 27th day of February, 1907. On examination of the judgment debtor his ownership of the Stock Exchange seat was disclosed as well as a large indebtedness on his part to various fellow-members of the exchange, under the rules of which such sums were to be first paid from the proceeds of sale of the seat provided such sale should be permitted. On the 7th of March, 1907, the receiver gave notice to the Stock Exchange officials of his appointment and qualification and served upon them a certified copy of his order of appointment. On the 3d day of May, 1907, Alley filed a voluntary petition in bankruptcy which resulted in an adjudication that he

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