
    William Halliday, Respondent, v. Harry I. Nicholas et al., Appellants.
    (New York Common Pleas—General Term,
    June, 1895.)
    In consideration of the withdrawal of plaintiff’s opposition to the consolidation of certain railroads, a certain sum was deposited with the defendants, to be held by them until a specified date and then paid to defendant, such payment to he conditioned upon the consolidation and issue of bonds in accordance with a proxy annexed to the agreement of deposit, and if such consolidation was not effected or such bonds issued, such sum was to be returned to the person making the deposit. Before the day specified the stockholders of the roads voted in favor of consolidation, but it was not perfected until after the date named. Held, that the agreement contemplated a consolidation effected before the date named; that the favorable vote of the stockholders did not effect a consolidation, and that the condition upon which plaintiff’s title to the fund depended was not fulfilled.
    
      Halliday v. Nicholas, 9 Misc. Rep. 217, reversed.
    Appeal from a judgment of the General Term of the City Court of New York, which affirmed a judgment entered upon a verdict in favor of the plaintiff.
    
      WilUam W. Baldwin and Charles A. Boston, for appellants.
    
      William M. Safford, for respondent.
   Bischoff, J.

This was an action for conversion. The fund alleged to have been wrongfully retained from plaintiff was held by the defendants under the following circumstances: Plaintiff and one Zimmerman were stockholders in the Peoria, Decatur & Evansville Railway Company, which company had in project a consolidation of the Chicago & Ohio River Railroad Company. Defendants were apparently interested in having this consolidation effected, but it was opposed by plaintiff and Zimmerman, which latter instituted an action to restrain the Peoria company from taking the course contemplated.

The defendant Nicholas employed one Hollins to obtain the consent of plaintiff and Zimmerman to the consolidation, and, upon the part of the latter, the discontinuance of the injunction suit, the terms of the agreement upon which plaintiff’s consent was actually obtained being that he should receive the sum of $693.50 upon such consolidation, but from whom the money was to be received does not clearly appear.

In pursuance of the agreement defendant Nicholas received certain checks, which, in the presence of one Rushmore, who apparently represented the plaintiff, were placed by Nicholas in an envelope and sealed up.

According to the plaintiff’s testimony, the agreement made by him with Hollins, under which agreement these funds were held by defendants, was as appeared in- a copy of a certain unsigned document, in evidence as plaintiff’s Exhibit C,” and which read as follows:

“ We, H. T. Nicholas & Co., admit the receipt of two thousand four hundred and ninety-eight dollars ($2,498), the same to be held by us until July 15th, 1893, and, on that date, paid out as follows :

To Frank C. Hollins......................... $1,111 00

“ William M. Halladay...............:..... 693 50

“ “ “ “ ..................... 693 50

$2,498 00

the aforesaid payments to be conditioned ujion the consolidation and issue of bonds in accordance with the terms of the proxy hereto annexed. In case the said consolidation be not effected, or said bonds be not authorized to be issued, the money to be returned to P. O’Connor, Esqre, from whom the same was received.”

' The proxy referred to was in the usual form of a power of attorney, authorizing the attorney designated to vote upon the “ proposition to consolidate,” etc., and describing the subjects of consolidation.

The only possible construction to be placed upon the words contained in this paper was that the payments noted were to be made by defendants to plaintiff only in event of the consolidation being “ effected ” before July 15, 1893; such was the express condition.

It was admitted upon the trial that the consolidation was not perfected ” until August, 1893, and plaintiff’s demand for the sum in suit was not made until September.

The recovery below was apparently based upon the theory that, granting the fact that there had been no actual consolidation before July first, yet, according to a deposition read in evidence by the plaintiff, the stockholders had met on the thirteenth of that month and voted in favor of consolidation. The party so deposing further stated that a consolidation was not “ effected ” until the laws regulating such action had been complied with, and this statement accords with our view of the situation.

The favorable vote of the stockholders did not effect ” a consolidation and authorize the issue of bonds to any greater degree than would the expressed determination of individuals to organize a corporation create such corporation and authorize its corporate assumption of liability.

It appearing conclusively from the plaintiff’s evidence that some forms of law were required to be complied with before the consolidation could become an accomplished fact, and that these forms were not complied with until after the fifteenth of July, it is clear to demonstration that there was no “ consolidation ” of these two corporations at that date, and hence the condition upon which plaintiff’s title to the fund held by the defendants, whether as stockholders, trustees or promisors, depended was not fulfilled and no cause of action for conversion was created by the latter’s refusal of his demand for payment when made.

Therefore, the exceptions to the denial of defendants’ motion for dismissal of the complaint when plaintiff rested, and to the justice’s refusal to direct a verdict at the close of the case, present error for which this judgment must be reversed.

Judgment reversed and new trial ordered, with costs to abide the event.

Daly, Oh. J., and Pbyob, J., concur.

Judgment reversed and new trial ordered, with costs to abide event.  