
    John S. Jones, Respondent, v. Joseph Ramsey, Jr., Appellant, Impleaded with George J. Gould and William E. Guy, Defendants.
    (No. 1.)
    First Department,
    July 8, 1908.
    Pleading—practice — power of Special Term to amend pleading during trial — failure to present formal pleading.
    The Special Term has jurisdiction to allow the service of a supplemental answer to an amended complaint, setting forth a prior recovery in another action as a bar, even though the cause be on trial at the Trial Term.
    When the right to serve such supplemental answer at trial has been denied by the trial court the defendant is entitled to a reversal, although he did not serve the supplemental answer allowed by the Special Term because he was led to believe that it would be of no avad as the trial court had previously stricken out the same defense from an answer served in open court.
    The error in rejecting the supplemental answer is not cured by the fact that the plaintiff's judgment in the prior action has been reversed.-
    Appeal by the defendant, Joseph Bamsey, Jr., 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 17th" day of December, 1907, upon the verdict of á jury, and also from an order entered in said clerk’s office on the 10th day of January, 1908, denying the said defendant’s motion for a new trial made upon the minutes.
    
      Appleton D. Palmer [Rush Taggart of counsel], for the appellant.
    
      David McClure [ William Burry with him on the brief], for the respondent.
   Laughlin, J.:

This action is brought to recover of the defendants the sum of $370,000, alleged to have been paid out by the plaintiff, at their special instance and request, in the purchase, of lands for them in the State of Ohio, in the latter part of the year 1902 and the first half of 1903, and plaintiff seeks to recover $90,000 in addition thereto for moneys paid out by him at the special instance and request of the defendants in examining, prospecting and-drilling the lands so purchased for coal, and for commissions for his services, aggregating the sum of $460,000, for which he demands judgment, together with interest thereon from the 1st day of January, 1903, besides costs. .

It appeared upon the trial that the defendants were constituted the managers of a syndicate known as “ Little Kanawha Syndicate,” to which others, including plaintiff, were subscribers. The syndicate agreement was dated the 2d day of December, 1901, and by virtue of its provisions the subscribers became such, as of that date. The object of the syndicate, as stated in the agreement, was to purchase a line of railroad extending from Parkersburg,- W. Ya., up the Little Kanawha river, about thirty miles, known as the Little Kanawha Eailroad, as then constructed and owned, and to extend- the same eastwardly and to purchase or build a railway from Parkersburg to Zanesville, Ohio, and to purchase coal lands in West Virginia. The syndicate agreement recited that the defendants and the subscribers thereto wished to form a syndicate to advance the necessary money to-- the amount of $6,000,000 for- the purposes specified. It does not appear whether the operations of the syndicate with respect to purchasing coal lands were extended to' Ohio, in writing or verbally,- but according to the testimony of the plaintiff he purchased the lands and paid out his own money therefor, at the instance of the defendant Eamsey, but on the understanding that the lands were acquired for this syndicate, and that he was “ to finance the deal until such a time as the Little Kanawha Syndicate would and could refund ” the money “ by making an assessment oh the syndicate.” He further testified that Eamsey indicated to him on a map the lands that wére desired, and stated, in effect, that it would be unwise to have it known that the syndicate-was buying the lands, and that it was advisable to have the plaintiff purchase the lands and advance his own money therefor, if he would be able to do so; that he agreed to this and asked Eamsey in whom title should be taken, to which Eamsey replied “that I could take it in any way that I saw fit, and hold it until" such a time as thé arrangement which he proposed with the syndicate could be carried out — that is, that the syndicate would pay back the money that I paid out, by an assessment that he would make upon the Little Kanawha syndicate;” that the question arose and was discussed between him and Eamsey as to whether he should take title in his own name or in the name of a corporation which he was desirous of organizing under the name of “ National Hocking Coal Company,” as the holding company, to take title to the" lands, as he deemed that ■ course better, and that “ Hr. Eamsey said he did not cane how I handled the matter, so I handled it and furnished the money necessary to purchase the lands.” The lands were purchased by the plaintiff with his own funds and title was taken in the name of the corporation which he organized under" the name already "stated. There is. no evidence that either of the other defendants had any negotiations or correspondence with the plaintiff which would render them liable to him. His theory was that the defendant Eamsey, with whom he had negotiations, acted for and represented the other defendants, fellow-managers of the syndicate with him, and that on account of the relation existing between the defendants by virtue of the syndicate agreement, they were all liable to him.

At the close of the plaintiff’s case, on motion of counsel for Gould and Guy, the court dismissed the complaint as to them, but denied the motion to dismiss it as to the appellant. It is doubtful whether the recovery could be sustained on the merits, on the complaint and evidence. The complaint shows that the lands were purchased at the request of the defendants and that the defendants promised and agreed to reimburse the plaintiff therefor. If there be any evidence to sustain that theory, the verdict in favor of the plaintiff thereon is against the weight of the evidence, for certainly the preponderance of the evidence shows that the plaintiff purchased the lands, investing his own. funds therein, and made the disbursements and rendered his services upon the express understanding that he was to be reimbursed therefor, not by the appellant, but by the syndicate, and there is no allegation or proof, that the appellant was not authorized by the syndicate to make the arrangement which was made with the plaintiff, nor is there any allegation that the appellant failed to make an assessment or take the necessary steps after demand, to obtain the funds from the syndicate' to reimburse the plaintiff. It would be our duty, therefore, to set aside the verdict as against the weight of evidence, for clearly appellant was not to be liable in the first instance without proof of neglect to carry out his' agreement to levy an assessment on the syndicate or of want of authority to represent the members thereof who were known to plaintiff; but if this were not so, there are errors which require a new trial.

It appears that the plaintiff brought another action against the same defendants, to recover upon the same cause of action, but upon a different theory. The material facts being the same a recovery in the other action if not warranted on the theory chimed could have been had on the theory here asserted if they gave rise to individual liability on any theory. (See Brackett v. Griswold, 112 N. Y. 454.) In the complaint in the other action he predicates their liability upon the ground that they were acting as managers of the syndicate, but the items for which recovery was sought are the same and judgment was there, as here, demanded against them individually. The plaintiff obtained a verdict in that action for the amount he seeks to recover in this and on substantially the same facts, and judgment was entered upon the verdict from which the defendants appealed. The judgment was reversed by this court (Jones v. Gould, No. 2, 123 App. Div. 236), upon the ground,, among others, that the defendants were acting as agents of disclosed principals, namely, the members of the syndicate, and were not personally liable. The evidence in that record is not materially different from that in the record now before the court.

When this ■ action was tried counsel for the plaintiff discovered that the complaint erroneously alleged that the plaintiff purchased all the lands in the latter part of the year 1902, whereas some of the lands were purchased during the fore part of 1903. Counsel for the plaintiff during the presentation of his case, requested leave of the court to amend this part of the pleading so as to read as follows: “ That the plaintiff, in pursuance of said agreement, during the latter part óf the year 1902, and the first half of 1903, purchased, for the said defendants the eighteen thousand acres of land.” Counsel for the defendants objected unless the court required the pleading to be formally amended and served, giving his client leave to answer and plead that in an action subsequently brought by the plaintiff against these defendants, on identically the same facts and cause of action, the plaintiff had recovered a judgment which had been duly entered. During the discussion of this matter between the court ''and counsel, the court said: It was brought to my attention before that a motion to that, effect was pending before Special Term* but that has not been decided.” Counsel for defendants informed the court that that was true, but that it.did not affect the authority of the trial court to allow the answer to be thus amended. The court expressed an intention to limit the defendants to answering the new matter which plaintiff desired to plead. Thereupon counsel for the defendants stated that he excepted to the court’s refusal to permit him to serve it, whereupon the court said: “You can state it to me; it contains a plea of a former judgment between the same parties Í ” Counsel for defendants answered the interrogation of the court in the affirmative and stated that the amended .answer contained a general denial and pleads that the complaint sets up the same cause of action as in another action between the parties on which judgment has been entered in favor of the plaintiff. The court thereupon granted plaintiff’s application to amend and denied the appellant’s demand that a formal pleading be served and that he be given leave to interpose an amended answer, pleading the judgment in the other action as a bar, and counsel for the defendants duly excepted. During the presentation of the defense counsel for the appellant informed the court that the motion of the defendants for leave to file a supplemental answer ■ setting up the judgment recovered in the other action as a bar had been granted by the Special Term, and that the decision was announced in the Law Journal of that day, and that in view of the decision of the Special Term he asked that the court reverse its former ruling, striking out that portion of the amended answer to the amended complaint which pleaded the judgment as a bar and let his amended answer stand with that plea in, or to permit him to serve an amended answer interposing the plea of the recovery in the other action as a bar, and he also offered the judgment roll in the other action in evid'ence. The court allowed the statement to be entered upon the record that the Special Term had granted the motion for leave to serve a supplemental answer by pleading the recovery in the other action as a bar. JSTo objection was raised either by counsel for respondent or the court that a formal order granting such leave had not been entered and served. Had such question been raised there would have been ample time for the entry and service of the order before the close of the trial. The pleading which the defendants had served in open court in answer to plaintiff’s amended complaint contained the appropriate allegations with respect to the recovery of the judgment .and pleading the same in bar, and those allegations when the answer was served the day before had been stricken out by the Court. • The request of counsel for appellant to have those allegations which had been stricken out restored, would have presented the pleading in the form in which he desired it and in accordance with the right accorded his client by the decision at Special Term. The record does not show that any objection was made or question raised either by counsel or by the court that another formal answer presenting the plea was not tendered. From the remarks of the court it is evident that the court was of opinion that the Special Term was without jurisdiction to modify the pleadings during the trial of an action at Trial Term, and it is manifest that it was upon that theory that the appellant was deprived of the benefit of this plea. It is unnecessary to decide whether the- defendant was entitled, as matter of right, to servó a formal answer to the amended complaint, pleading the recovery in the other action since the service of the original answer as a bar, and on that question the members of the court entertain different views. We are all of opinion that the Special Term had jurisdiction to allow the service of a supplemental answer, pleading the recovery in the other action as a bar, and that this gave the defendants and the appellant when left as the sole defendants an absolute right to serve it forthwith arid entitled them and him to the benefit thereof. Since the appellant could,.and doubtless, would, have done this had objection been taken either by court or counsel that the proposed supplemental answer was not presented, and was led to refrain from doing so on the theory that it would be of no avail in view of the ruling off the trial court, wé are of opinion that he is entitled to a reversal. We have observed, but it is'unnecessary to decide, that both actions are founded on the same cause of. action. The. appellant was entitled to the benefit of his pleading and to present the judgment roll ■ upon that theory. The error occurred upon the trial., It cannot be remedied or corrected by a subsequent occurrence in the other action. The fact that the judgment in the other action has since been reversed by this court does not cure the error. The appellant was entitled, as matter of right, to make the record according to the facts, and to have this plea and the judgment roll in the record, and to any advantage that might accrue therefrom. If a party unnecessarily prosecutes two actions on the same cause of action, he may expect that some of the proceedings will go for naught. It has been an expensive experiment for the plaintiff, and has also unnecessarily burdened the courts; but so long as the plaintiff claims that the causes of action areydifferent he cannot be heard to object to -this being moved for trial, and if they were different, the ■ defendants would have the right to have them tried, unless the plaintiff discontinues, or submits to a dismissal in one, and the courts would be obliged to hear and decide the cases as they come before them; but it would seem that the court- may of its own motion refuse to hear both of these actions, upon the ground that they involve the same cause of action.

It follows that the judgment and order should be reversed and a new trial granted, with costs to appellant to abide the event.

Ingeaham and Houghton, JJ., concurred; Scott, J., concurred in result.

McLaughlin, J. (concurring):

The plaintiff was permitted to amend his complaint at the trial, and thereupon the defendant Eamsey had an absolute right, under the statute, to interpose answer thereto and set up such facts as he might be advised constituted a defense, whether they occurred prior or subsequent to the commencement of the action. When the court refused to allow him to plead the recovery of the judgment in the other action, this right was' denied him. The court had no power to limit his defense. It was not a supplemental answer, but an answer to the.amended complaint, and took its place in the action, so far as the trial was concerned, precisely as though it had been interposed when issue was first joined.

Upon this ground, as well as those stated by Mr. Justice Laughlin, I am of the opinion that the' judgment appealed from should be reversed and a new trial ordered.

Judgment and order reversed, new trial granted, costs to appellant to abide event.  