
    Julius Saul, Respondent, v. The United States Fidelity and Guaranty Company, Appellant.
    
      Auctioneer’s bond in the city of New York — liability of the surety for the proceeds of goods sold—sufficiency of the complaint as to the issuance of the license—submission of a law to the mayor after the passage and before the taking effect of the' Greater New York charter.
    
    Section 5 of chapter 683 of the Laws of 1897, relating to auctioneers in cities of 1,000,000 inhabitants and over, which provides that the sureties upon a bond given by an auctioneer pursuant to the act “ shall be liable for breach of contract or of duty towards the person or persons consigning goods for sale, as well as for the other acts, omissions and matters now provided by law,” was, by virtue of section 1610 of the charter of Greater New York (Laws of 1897, chap. 378), extended to the city of New York as therein constituted.
    Consequently, a bond given by an auctioneer in the city of New York, after the 1st day of January, 1898, under the provisions of chapter 683 of the Laws of 1897, and section 34 of the Greater New York charter, which relates to the bond to be given by an auctioneer, but does not modify the provisions of section 5 of chapter 683 of the Laws of 1897, is a statutory bond, and the surety thereon is liable for the breach by the auctioneer of his duty to account to a consignor'for the proceeds of goods sold by him.
    The fact that chapter 683 of the Laws of 1897 was not transmitted to the mayor of the new city of New York, as constituted by the Greater New York charter which was passed prior to the passage of chapter 683 of the Laws of 1897, but did not go into effect until January 1, 1898, did not render it unconstitutional. It is sufficient that it was transmitted to and approved by the mayor of the city of New York as it existed at the time the act was passed.
    A complaint in an action-upon an auctioneer’s bond which alleges that the principal made application for a license for the year 1900 and filed a bond, a copy of which was attached to the complaint, and “that pursuant to the saici licenses and each of them the said Grouse did enter into and carry on said business and occupation of an auctioneer in'the city of New York,” sufficiently alleges that a license was issued to the principal for the year 1900.
    Appeal by the defendant, The United States Fidelity and Guaranty Company, from an interlocutory 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 14th day of December, 1901, upon the decision of the court, rendered after a trial at the New York Special Term, overruling the defendant’s demurrer to the complaint.
    
      Leonidas Dennis, for the appellant.
    
      Felix H. Levy, for the respondent.
   Ingraham, J.:

The action is brought to recover upon a bond given by one Solomon 1VI. Grouse as principal, and the defendant as surety, upon an application by Grouse for a license as auctioneer in the city of New York. The condition of the bond, which is annexed, to the complaint, is that if the said Solomon M. Grouse and his copartners, and his and their clerks, agents and servants, shall well and truly, carry on his said business of auctioneer, and in all things obey and conform to all laws of the State of New York, and all ordinances and resolutions of the Municipal Assembly of the' said The City of New York, now in force, or hereafter to be adopted,, relating, especially to the business of auctioneer in the said The City of New York, then this obligation to be void; otherwise to remain in full force and effect.” The complaint alleges that Grouse made-application to the city clerk of the city of New York for. a license to carry on the business and occupation of an auctioneer in the city of New York pursuant to the statutes of this State, and presented his bond, duly executed by himself as principal and the defendant as surety, in the penal sum of $2,000,. in accordance with the statutes of this State, and that upon the filing of the aforesaid bond a. license was issued by him on the 5th day of June, 1899, to the said Grouse, permitting him to engage in and carry on the business- and occupation of an auctioneer for a period of. one year from the said date ; that upon the expiration of the said license, and on or about the 19th of June, 1900, the said Grouse made application to the said city clerk for the continuation of the said license or a new license permitting him to carry on the said business and occupation of an auctioneer, and duly presented his bond, duly executed by himself as principal and the defendant as surety, in the penal sum of $2,000; that pursuant to the said licenses and each of them, the said Grouse entered into and carried on said business and occupation of auctioneer in the city of New York, and that on or about the 10th day of March, 1900, the plaintiff dealt with the said Grouse as such auctioneer and consigned to him for sale at auction a large quantity of goods and merchandise of the value of $10,500 ; that between the months of March and September, 1900, the defendant sold at auction the said goods and merchandise so consigned for sale by the plaintiff, but that during said times and ever since he has refused and neglected to turn over to this plaintiff or to account to him for a part of the money arising from the said sales, to the amount of about $2,000, and converted the same to his own use» that by reason of such neglect and refusal and conversion, the said Grouse cheated and defrauded the plaintiff and did not well and truly carry on his said business or occupation of auctioneer, and did not in all things obey and conform to all the laws of the State of New York, and all ordinances and resolutions of the municipal assembly of said city now in force or hereafter to be adopted, relating especially to the business of auctioneer in the said city of New York, according to the conditions of the said bonds; that prior to the 6th day of December, 1900, the plaintiff, pursuant to the statutes of this State, complained in writing of the fraud practiced upon him by the said Grouse to the president of the municipal council of the city of New York, and that on said day the said president, due notice and opportunity of defense having been given, took the testimony of both parties, the plaintiff and the said Grouse, under oath, relating to the charge of fraud contained in the said complaint ; that after such hearing, pursuant to the authority vested in him by section 34 of the Greater New York charter (Laws of 1897, chap. 378), the said president found and determined that the said charges were in his opinion sustained, and revoked the license granted to the defendant auctioneer; and that the plaintiff has demanded of the said Grouse that he account for said, moneys and pay the same to. the plaintiff, but that the said Grouse has wholly neglected and refused to do so ; that due notice thereof was given to the defendant and thereupon payment was demanded of the defendant of" the said sum of $2,000, but that the defendant has wholly refused and neglected so to pay.

By chapter 682 of the Laws of 1897 (§§ 1, 2) it is provided that no person shall carry on the business of auctioneer in cities of 1,000,000 inhabitants and over without first having obtained from the mayor of said city a license authorizing such person to carry on the business of auctioneer, and that a license fee of $250 per annum shall be paid to the city. Section 4 provides that all. auctioneers, before the license to them issued shall become operative, shall file with the comptroller, or city treasurer of the city in which they shall be licensed a bond in the penal sum of $2,000. Section 5 provides that “ the sureties upon a bond as provided in section one hereof shall be liable for breach of contract or of duty towards the person or persons consigning goods for sale, as well as for the other acts, omissions and matters now provided by law.”

By section 34 of the charter of the city of New York (Laws of 1897, chap. 378) it is provided that “ the city clerk shall have authority to grant licenses to any pérson engaged in and carrying on the business and occupation of auctioneer, or desiring to be so engaged, on such person filing a bond approved by him with two good sureties in the penal sum of two thousand dollars. The president of the council, on complaint of any person having been defrauded by any auctioneer, Or by the clerk, agent or assignee of such auctioneer, doing business in said city, is authorized and directed to take testimony under oath relating thereto ; and if the charge shall in his opinion be sustained, he shall revoke the license granted to him and direct the bonds to be forfeited.”

If these provisions were in force at the time of the giving of these bonds and of the default of the auctioneer in accounting to the plaintiff for the proceeds of the sale of goods consigned to the auctioneer for sale hy the plaintiff, it would seem that the surety upon the. bond is liable for the breach of the auctioneer’s duty to account to the plaintiff for the proceeds of the goods consigned to and sold by the auctioneer. The act of 1897 became a law on May twenty-second of that year. The charter of the new city of New York became a law on May 4, 1897. Section 1610 of the charter provides that “ all the provisions of all acts of the Legislature of the State of New York * * * of a general and permanent character relating to the corporation heretofore known as the Mayor, Aldermen and Commonalty of the City of New York, in force at the time this act goes into effect, which are consistent with this act and its purposes, and which are not revised and included in or the subject matter thereof covered by this act, are hereby extended to the City of New York as herein constituted, so far as they are consistent with this act and are not in their nature locally inapplicable to other portions of the city than the corporation heretofore known as the Mayor, Aldermen and Commonalty of the City of New York.” Section 1611 of the charter provides that, “ this act shall take effect on the first day of January, eighteen hundred and ninety-eight.”

As chapter 682 of the Laws of 1897 was in force on the 1st day of January, 1898, the time that the new charter went into effect, the provisions of section 5 of that act, so far as it imposed upon the surety a liability for a breach of contract or of a duty towards a person consigning goods for sale, and was not revised and included in or covered by the charter, would appear to be by the terms of section 1610 of the charter extended to the city of New York as therein constituted. It would appear, therefore, that a bond given after the 1st day of January, 1898, under the provisions of chapter 682 of the Laws of 1897 and section 84 of the charter would be a statutory bond, and the surety would be liable to a person consigning goods to the auctioneer for sale for a breach of a contract or a duty of the auctioneer to such person.

It is claimed, however, that chapter 682 of the Laws of 1897 is void as to the city of New York under section 2 of article 12 of the Constitution, which provides that special laws relating to the property, affairs or government of cities shall not be passed until such laws shall have first been submitted to the local authorities for their approval. It appears that chapter 682 of the Laws of 1897 applied at the time of its passage to but one city in this State, namely, the city known as the Mayor, Aldermen and Commonalty of the City of New York, and that the act was duly transmitted to the mayor, of the city of New York as then constituted, and was approved by him. The contention'of the appellant is that the act is void as not being approved by the mayor of the new city of New York as constituted by .the new charter passed prior to the-passage of the act of 1897, but which did not go into effect until January 1, 1898. It. is quite clear, however, that the Mayor, Aldermen and Commonalty of the City of New York, as then" constituted, was the only city to which chapter 682 of the Laws of 1897 applied. There was no other city then in existence to which the act could apply. When this act was passed there was no mayor of the new city of New York. There was in fact no city of New York, except the city to the mayor of which the act was transmitted, and the mayor of that city having approved the act, it was duly accepted by the city to which it applied and became a valid law, applicable to that city during the remainder of the year 1897 before the act creating the new city of New York went into effect. By the provisions of the charter of the new city of New York,, which took effect on the 1st day of January, 1898, this act, then a valid act affecting the the city of New York, was extended to the new city then created ; but nothing in the Constitution required that an act should be submitted to the local authorities of a city not in existence at the time it was passed or approved by the mayor of a city which was to come into existence subsequent to its passage. The provisions of the Constitution "were fully complied with by transmitting the act to the mayor óf the city that it affected at the time it was passed, and upon being approved by him it became a law. The officer authorized to issue the license to the auctioneer after January 1, 1898, was designated by section 31 of the charter which modified the second section of the act of 1897, to which attention has been called ; but the provisions of section 5 of the act of 1897 were not affected and,. I think, controlled.

The objection that the complaint does not allege that a license was issued to the principal for the year 1900, is also taken by the defendant. The goods were consigned to the auctioneer in the year 1899, and the obligation to account for them then arose. If no license had been issued in the year 1900, and.the auctioneer, having possession of the'goods, subsequently appropriated their proceeds, he would have been guilty of a breach of duty, for which his surety on the bond of 1899 would have been liable. If, however, it were necessary to hold with the defendant that a license should have been issued for the year 1900, we think the issuance of such a license was alleged by implication. The allegation is that the principal made application for a license for the year 1900 and filed a bond, a copy of which is annexed to the complaint, and “that pursuant to the said licenses and each of them the said Grouse did enter into and carry on said business and occupation of an auctioneer” in the city of Hew York. This allegation could not be true unless a license for the year 1900 was issued.

We think the defendant was liable, and that the judgment should be affirmed, with costs, with leave to the defendant within twenty days to withdraw demurrer and answer upon payment of costs in this court and in the court below.

Van Brunt, P. J., Patterson, McLaughlin and Hatch, JJ., concurred.

Judgment affirmed, with costs, with leave to defendant to withdraw demurrer and answer on payment of costs in this court and in the court below.  