
    JACOB T. BAMBERGER, et al., Respondents v. FIRE ASSOCIATION OF NEW YORK, Appellant. SAME, Respondents v. MUTUAL FIRE INSURANCE COMPANY, Appellant. SAME, Respondents v. ARMSTRONG FIRE INSURANCE COMPANY, Appellant.
    
      Fire insurance—Fraud set tip in answer—Reference, discretion of court in ordering the same.
    
    In each of these actions the defendants-appeilants, have set up in their answer a charge of fraud on the part of the insured, and for this reason the motion made by each defendant for a compulsory reference was properly denied. Although the character of the action is to be determined, yet in the exercise of its discretion the court will look at the papers submitted on both sides, and if it appears that a charge of serious fraud is involved in the issues the motion for a compulsory reference may well be denied even if the action is referable, and with the exercise of that discretion the court on appeal will not interfere.
    Before Freedman and Ingraham, JJ.
    
      Decided June 27, 1890.
    Appeal from order denying defendants’ motions for a reference.
    
      
      Stine & Caiman, attorneys, and Joseph H. Choate of counsel, for appellants.
    
      Hoadley, Lauterbach & Johnson, attorneys, and Edgar M. Johnson of counsel, for respondents, on the questions considered, argued :—
    Even were we to concede that the trial would not involve a long account or difficult questions of law within the meaning of the Code, still no reference should be granted, because of the questions of fraud put in issue by defendants’ answers. (1.) In the leading case of Levy v. Brooklyn Fire Ins. Co., 25 Wend. 688, it appears that : “An officer of the insurance company made an affidavit that the trial of the cause would require an examination of the plaintiffs inventory, as well in respect to the goods, the amount thereof, the value of the portions totally destroyed and of the portions partially destroyed, as in respect to the correctness of the account of the loss exhibited by the plaintiff, and thus that the trial would require the examination of a long account. In answer to which the plaintiff made an affidavit that he was informed by the officers of the insurance company that their defence was two-fold : 1. That he had fraudulently caused- the conflagration by which the property insured was injured; and 2. That in making up his statement of loss, he had fraudulently overestimated the amount of his loss, and thus had forfeited all claims upon the defendant, lie further stated, that although the property destroyed or injured consisted of a variety of articles, differing in quality and value, yet his whole claim was founded upon a single occurrence, to wit, the injury done by the fire ; that his counsel had offered, and he still was willing, to refer the cause to ascertain the true amount of his loss, provided the defendants would waive the defences of fraud in firing the premises and overestimating the loss, both of which charges he pronounced utterly false, and therefore claimed a trial by jury. The Circuit Judge referred the cause, notwithstanding the opposition of the plaintiff, who now moved to vacate the order of reference.” The opinion of Chief Justice Nelson is thus reported (p. 688) : “ The Chief Justice said, that without attempting to lay down any general rule as to the reference of actions on policies of insurance, he was of opinion that in a case involving such serious charges as were here brought against the plaintiff, a party was entitled to the benefit of a trial before a court and jury, and that therefore he would direct the order for reference to be vacated.” In McLean v. East River Ins. Co., 8 Bosworth, 700, it was held (syllabus) : “In an action on an insurance policy where the defence involves a charge of fraud on the part of the'insured, a compulsory reference of the issues cannot be ordered.” In Freeman v. Atlantic Mutual Ins. Co., 13 Abb. 124 (General Term, First Department), a similar decision was reached. In Batchelor v. Albany City Ins. Co., 1 Sweeny, 346, the two cases last cited are expressly approved by this court (p. 357), as deciding that the presence of an issue of fraud is an effectual bar to the granting of a motion for reference.
   By the Court.—Freedman, J.

These three actions have been brought to recover moneys due on account of three policies of insurance covering plaintiffs’ stock of merchandise at their store in Louisville, Ky. These policies form part of a total number of 144 policies upon the whole stock of said merchandise. In each of these actions the defendants have set up a charge of fraud on the part of the insured. For this reason the motion made by each defendant for a compulsory reference was properly denied. True, the character of the action is to be determined from the complaint. But, in exercising its discretion upon the question whether a reference shall or shall not be compelled, the court will look at the papers submitted by both sides, and if it should appear that a charge of serious fraud is involved in the issues, the motion may well be denied, even if the action be referable. With the exercise of that discretion the general term will not interfere. The views already expressed render it unnecessary to determine the question of power.

In each case the order appealed from should be affirmed, but there should be only one bill of costs.

Ingraham , J., concurred.  