
    Stephen Lee et al., App’lts, v. John L. Taylor, Impl’d, Resp’t.
    
      (Supreme Court, General Term, First Department
    
    
      Filed May 23, 1890.)
    
    1. Fraud — Eight of action for distinct fraudulent purchases.
    Where separate and distinct purchases are fraudulently made upon different days, a separate cause of action accrues to the vendor for the damages resulting from each purchase as an independent act of fraud, notwithstanding the general purpose of the purchaser and that such purpose was continuous.
    2. Same — Bar.
    The settlement of an action of replevin for certain of the goods so sold, against one who had received them with knowledge of the fraud, for a portion of the claim, is not a bar to an action against him and the vendees for damages resulting from the series of frauds. In such case it will be inferred that it was intended to compromise only the specific claim sued for.
    Appeal from judgment of the special term overruling the plaintiffs’ demurrer to a separate and distinct defense in the defendant’s answer.
    Plaintiff alleges in his complaint that he made sales to Kendall Brothers on credit from time to time. He likewise alleges that Kendall Brothers failed. The defendant Taylor, early in 1882, being a creditor of Kendall Brothers, in some $70,000, and having learned that the latter were hopelessly insolvent, made an agreement with them (the Kendalls) that he should sustain the credit of the Kendalls by advances of cash and notes sufficient to pay their obligations as they matured, until they could pay their debt to him. That this was done, and the Kendalls bought large amounts of goods from various persons (including the goods bought from the plaintiffs), which goods, or the proceeds, were at once turned over to him, until the debt owed to him was paid at the expense of the plaintiffs and others, and when that was accomplished Kendall Brothers failed. Shortly after the failure of Kendall Brothers, the plaintiffs, finding in the hands of Taylor certain of the goods claimed to be identical with those which had been bought by the Kendalls thus fraudulently from them, brought an action of replevin against Taylor to recover these specific goods, and that action was compromised.
    In bringing the present suit (which is one on the case for damages) the goods mentioned in the replevin suit were expressly excepted from those covered by the present suit, that is, the goods upon which this action is based are not the goods which the action of replevin was brought to recover. The defendant Taylor (who alone answers), sets up the replevin suit and its compromise, as a bar to this action, on the ground that the cause of action being, as he says, “ a conspiracy,” is an entire one, and hence all the damages sustained should have been sued for in one action.
    To this defense the plaintiff demurred.
    
      Francis 0. Barlow, for app’lts; John A. Metres, for resp’t.
   Barrett, J.

The question here is whether the plaintiffs’ right of action was single and entire, or' whether they had a separate and distinct cause of action for each bill of goods sold. The action is what would formerly have been called an action on the case, in the nature of conspiracy; and it is well settled that the damage to the plaintiff, and not the conspiracy, is the gist of such an action. Tappan v. Powers, 2 Hall, 277; Jones v. Baker, 7 Cowen, 445; Hutchins v. Hutchins, 7 Hill, 104; Buffalo Lubricating Oil Co. v. Everest, 30 Hun, 588; Verplanck v. Van Buren, 76 N. Y., 259. “An allegation of conspiracy,” as was said in Buffalo L. Co. v. Everest, “ between the defendants to commit the act complained of, is of no importance so far as it respects "the cause and ground of action, * * * if there be a failure to prove the combination, then the plaintiff is entitled to a verdict against either defendant upon whom an unlawful act is proved to the damage of the plaintiff.” In Verplanck v. Van Burén, supra, Folger, J., said that “in such action the evidence of a technical conspiracy is not essential. The damage is the cause of action, and the conspiracy mere matter of aggravation.” Citing Skinner v. Gunton, 1 Wm. Saunders, 228, c., note 4. Proof of conspiracy is only essential when a verdict is demanded against two or more defendants. And the practical importance of such proof arises from the rule which thereupon permits the plaintiff to give in evidence the declaration of co-conspirators, as against each other, while engaged in furthering the conspiracy.

It is apparent, therefore, that the cause of action set up in the complaint was not single and entire. The goods fraudulently obtained were purchased on many different days between August and November, 1882. Each purchase was a distinct and several act of fraud, for which the plaintiff was entitled to maintain a separate action. This was not affected by the defendant’s general purpose, nor by the fact that such purpose was continuous. The rule laid down in Secor v. Sturgis, 16 N. Y., 548, was misunderstood or misapplied at the special term. The court, in Secor v. Sturgis, said “that it was entire claims only which cannot be divided; those which are single and indivisible in their nature.

The 'cause of action in the different suits must be the same. The rule does not prevent, nor is there any principle which precludes the prosecution of several actions upon several causes of action * * * a party upon whose person or property successive distinct trespasses have been committed may bring a separate suit for every trespass.”

And again: “ The true distinction between demands or rights of action which are single and entire, and those which are several and distinct is, that the former immediately arise out of one and the same act or contract, and the latter out of different acts or contracts. Perhaps as simple and safe a test as the subject admits of, by which to determine whether a case belongs to one class or the other, is by inquiring whether it rests upon one or several acts or agreements.” In the present case, each sale was, as already observed, separate and independent. Such sales were made upon a credit of from two to four months. For a part of these sales, the plaintiff received twenty-seven separate and distinct promissory notes, dated on different days and maturing on different days. It is plain, as was said in Zimmerman v. Erhard, 83 N. Y., 78, that these “ different sales did not constitute one entire and indivisible demand, and the plaintiffs could bring separate actions for each separate sale, or for all of them together, as they saw fit. The different demands were like several promissory notes, or several distinct trespasses, and in the nature of separate and distinct transactions, for each of which a separate action might be brought.” Of course, if the gist of the action here was the conspiracy, it might well be deemed “single and entire.” It could, perhaps, then be argued that there was but one conspiracy, and that each purchase in furtherance thereof was but an element of the general damages. That theory falls when the conspiracy is eliminated as the gist of the action. So upon the theory of separate and distinct frauds, if any one purchase on any given day had embraced several items, the principle contended for by the defendants would doubtless apply to each of such items. Farrington v. Payne, 15 Johns., 432; Smith v. Jones, id., 229; Miller v. Covert, 1 Wend., 487. But where separate and distinct purchases were fraudulently made upon different days, we have no doubt that a separate cause of action accrued to the plaintiffs for the damages resulting from each purchase as an independent act of fraud.

We think too that it was the intention of the parties to limit the settlement, set up in the answer, to the particular claim embraced in the then pending action. It will be observed that that action was against but one of the present defendants, and was simply for the conversion of certain specified goods, valued at. upwards of $12,000. There was no formal charge of conspiracy, but the defendant was sought to be held because of his alleged connivance with the purchasers. The suit was settled for $4,000 in the defendant’s notes, which were received (according to the tenor of the instrument then signed by the plaintiffs), “ in full settlement and discharge of all claims embraced in,” that action and “of the costs thereof.”

It was held in O'Beirne v. Lloyd, 43 N. Y., 251, that parties may make a valid agreement to sever an entire demand and compromise the part sued for, leaving the residue to stand; and that such a reservation may be inferred from the circumstances.

We think such a reservation should be inferred. The action was settled for about one-third of the sum claimed. It was an action against Taylor alone. It proceeded upon the legal theory that certain goods belonging to the plaintiffs, the title to which had not been passed owing to the vendor’s fraud, were found in Taylor’s possession, and that he had received them, not as a bona fide purchaser, but with notice of the fraud. The plaintiffs thereupon alleged a demand of the goods from Taylor and a refusal to deliver them, to their damage some $12,000. What was intended to be settled was that specific claim for the refusal to dc-liver to the plaintiffs upon demand, the specific goods found in Taylor’s possession. That, and nothing else; certainly not a claim against Taylor and the purchasers of the goods for damages resulting from a series of frauds, one of which happened to cover the particular goods embraced within the action against Taylor alone for conversion.

We think, therefore, that the judgment appealed from should be reversed with costs, and the plaintiffs’ demurrer to the twentieth clause of the defendant’s answer sustained with costs.

Yan Brunt, P. J., and Bartlett, J., concur.  