
    FRANCIS PARES OSBORN, et al., Plaintiffs v. WILLIAM C. ROGERS, et al., Defendants.
    
      'Written instrument, construction of, principles, applicable to where its meaning and purpose by reason of ambiguity or confusion of language is not clear.
    
    Defendant,, for the purpose of enabling one Rogers (who was one of them) to comply with the conditions of an order made on his motion which stayed proceedings on a j udgment against him pending an appeal by him, first to the general term and then in a certain event to the Court of Appeals, from an order at special term denying his motion to vacate a judgment recovered against him and the execution thereon,and which discharged a levy made under an execution in such judgment on certain conditions, gave to plaintiffs a joint and several bond conditioned that “ in case said order appealed from shall be affirmed by the general term, and if an appeal be taken from the determination of the general term upon such appeal to the Court of Appeals in case said order be finally affirmed by such Court of Appeals, the defendant, Wil•liam 0. Rogers, shall well and and truly pay unto the plaintiff’s,’ etc. This bond complied with and pursued the conditions of the order granting a stay and discharging the levy. The general term reversed the order appealed from. On appeal to the Court of Appeals that court reversed the general term and affirmed the special term.
    The question involved was, whether the phrase “ in case said order be finally affirmed by the Court of Appeals ” was confined to an affirmance after an affirmance by the general term, or included an affirmance after a reversal by the general term, in other words whether or not it referred to an affirmance of the special term order whatever may have been the determination of the general term from which the appeal to the Court of Appeals was taken. If the phrase included an affirmance by the Court of Appeals after a reversal by the general term, then plaintiffs were entitled to be paid the sum conditioned to be paid by the bond, otherwise not.
    
      Held, (1.) That it is a principle of law that where the meaning and purpose of a written contract, from the ambiguity or confusion of language employed, is not quite clear, such a construction of it is to be sought for and adopted as may be the most reasonable, the most liberal and most consistent with the sense in which the promisor believed the promisee accepted the promise and in which he did actually accept.
    
      (2) That upon this principle, in view of the facts and circumstances attendant on and surrounding the execution of the bond, the sense mutually understood by the parties was that payment was to be made to plaintiffs upon the order being affirmed by the general term, or if the litigation was carried to the Court of Appeals by either of the parties then upon affirmance by that court.
    (3) That plaintiffs’ were entitled to judgment for the sum conditioned to be paid by the bond.
    Before Sedgwick, Ch. J., Freedman and O’Gorman, JJ.
    
      Decided May 5, 1890.
    Submission' in an agreed case. The facts sufficiently appear in the opinion.
    
      Couderb Brothers, attorneys and of counsel, for plaintiffs, argued :—
    I. The bond was executed and delivered as the condition of a favor to the defendant Rogers—as the “ terms ” upon which his request for favor was granted. That request is found in the affidavit of Rogers, at folio 19 of the case, and is in the following words. “ The defendant asks for a stay of proceedings, pending said appeal, and that the levy under the execution herein be discharged upon such terms as to the court may seem just.” This language is substantially repeated in the order to show cause and precludes any necessity of citing authority in support of the power of the court to exact terms in the premises. In other words, the power is conceded. Rogers asked for two things : (1.) For a stay of proceedings under the judgment and execution pending his appeal. In respect of this element -we concede that the vitality of the bond expired upon the reversal of the order by the general term. After that, and pending the plaintiffs’ appeal to the Court of Appeals, there was no necessity for a stay ; for although the judgment was never cancelled of record, the plaintiffs could not have enforced it, with the order of reversal staring them, in the face. (2.) The other favor asked for was the discharge of a levy which afforded the plaintiffs ample security for their debt. The bond was a substitute for this security. This element is entirely lost sight of in thé contention of the defendants. (3.) The decision of the court, at special term, upon the favors asked for was practically, this :—“ Yes ; proceedings shall be stayed and your property, which the plaintiffs hold as a security, shall be released and handed back to you, to dispose of as you see fit, upon condition that you give the plaintiffs equally good and ample security in its stead.” That this was intended is evident from the provision in the order and in the bond itself, for payment “ within thirty days after the final affirmance of said order,” by either the general term or the Court of Appeals, as the case should be. (4.) That this bond was exacted, not only to stay proceedings, but as a consideration for the discharge of the levy cannot be disputed.
    II. It is clear from all the circumstances of the case and from the language of the bond itself, that the contingency contemplated was a final affirmance of the order of the special term, whether that final affirmance should be by the general term, (in case no appeal should be taken to the Court of Appeals), or by the Court of Appeals. It is also clear that both the order and the bond contemplated an appeal by either party to the Court of Appeals.- The language of the order is “if an appeal be taken from the determination of the general term upon such appeal,” that of the bond, “ in case of an appeal from the determination of the general term.” The office of the bond was two-fold. (1.) To protect the defendant from further prosecution under the judgment until his motion to vacate should have been finally passed upon ; and (2.) To indemnify the plaintiffs for the loss of the security afforded them by the levy. The propriety for such indemnity is shown by the fact that otherwise their final success in the court of last resort would have proved a barren victory. And it is undoubtedly true that the possibility of such a contingency was in the mind of the court at special term when indemnity was demanded as the condition of discharging the levy.
    III. The contract of the defendants is in plain, unmistakable terms—“ in case said order be finally affirmed by the Court of Appeals, the defendant, William C. Rogers, shall well and truly pay * * * within thirty days after the final affirmance of said order by such Court of Appeals.” If there were any ambiguity in the language of the obligation, (which we deny) it should be construed against, the obligors. Ripley v. Larmouth, 56 Barb. 21 ; Marvin v. Stone, 2 Cow. 781 ; Grifford v. First Pres. Soc., 56 Barb. 114 ; White v. Hoyt, 73 N. Y. 505 ; Hoffman v. Ætna Fire Ins. Co., 32 lb. 405.
    • IV. In the case of Robinson v. Plimpton, 25 N. Y. 484, it was held that the sureties in an undertaking on appeal from an order of the special term which was reversed by the general term, were not thereby discharged ; but were liable upon the ultimate affirmance of the first order by the Court of Appeals. The language of the undertaking in that case was general ; following § 335 of the Code of Procedure—“ that if the judgment appealed from, or any part thereof, be affirmed, or the appeal be dismissed, the appellant will pay,” etc. There was no reference, in the undertaking, to either the general term or the Court of Appeals ; and it was claimed' that the reversal by the general term absolutely discharged the sureties, and that they could not be again made liable, without their assent, by the order of another court in an appeal to which they were strangers. The court held that “ the statute and the undertaking given in pursuance of it, have respect to the final determination in the court of last resort, or the last court to which the parties may take it by appeal.” The cases cited by Mr. Justice Allen, in that opinion are Traver v. Nichols, 7 Wend. 434 ; Bennet v. Brown, 20 N. Y. 99 ; Ball v. Gardener, 21 Wend. 270 ; and Smith v. Crouse, 24 Barb. 433. And the case Robinson v. Plimpton has been cited and the principles there enunciated approved in Doolittle v. Dininny, 31 N. Y. 350 ; Hinckley v. Kreitz, 58 lb. 583 ; Humerton v. Hay, 65 lb. 380. A fortiori, where the instrument itself makes specific provision for payment within thirty days after affirmance by the general term, (if no appeal be taken from that affirmance), and also, in terms, for payment within thirty days after final affirmance by the Court of Appeals, if an appeal be taken from the determination of the general term.
    
      Marston Niles,- attorney and of counsel, for defendants Edgar and Grannis, among other things, argued :—
    I. The bond has these words : “ The court having ordered such discharge of levy and a stay of execution * * * in case of an appeal from the determination of the general term to the Court of Appeals * * * until the final determination of the Court of Appeals.” 'The plaintiffs claim that the court ordered such discharge and stay, even in case the general term should vacate the judgment and discharge the execution, and the plaintiffs should appeal. Why should the special term order that the levy should remain discharged and the stay of execution continue at a time when the judgment should have been wholly vacated and the levy have been entirely discharged, and the execution rendered null ? Of high value to the defendant, as the plaintiff thinks, would be a stay forbidding the plaintiffs to issue execution upon a judgment that had already been, vacated. On account of the value to him of such a stay, the plaintiffs think the special term imposed upon him the burden of a bond pending the operation of such a stay, and on account of its value the defendant was willing to give the bond. But perhaps the plaintiffs will say that there was another purpose in exacting the bond ; viz., that the plaintiffs should be protected in case the general term should vacate the • judgment and the plaintiffs take an appeal to Albany. According to the plaintiffs, the special term designed to protect the plaintiffs against a possible adverse determination of the general term. The ■ general term might, perhaps, determine that the special term had been in error. Therefore the special term, by exacting a bond, secured the plaintiffs against injury by the general term, and threw its defending arm about the plaintiffs until the Court of Appeals could be heard from. Assuming that the special term designed the bond to baffle somewhat the effect of the general term’s determination, how would the stay operate which was granted in consideration, of the bond? In fact the general term vacated the judgment. As soon as the judgment was vacated the plaintiffs were stayed. Stayed by virtue of the stay, say the plaintiffs ; and therefor, say they, the bond which was the condition on which the stay was granted, held good. Is that true ? Was it not because the plaintiffs had now no judgment in their favor that they were stayed ? But perhaps the plaintiffs will say that the meaning was that the defendant should somehow be stayed, in case the judgment against him should'be set aside by -the general term ? should be stayed till the Court of Appeals could be heard from. Assuming that the special term had jurisdiction to stay the operation of the general term’s determination, in what would such stay of the victorious defendant consist ? What proceedings of the defendant could there then be to stay ? The defendant would be having no proceedings pending ; he would simply have gone about his business. But assuming the defendant might take some proceedings except for this stay, why should he be called upon to give a bond as a condition of staying his own proceedings ?
    II. I understand the plaintiffs make claim that the words “ until the final determination of defendant’s said appeal from said order by the general term ” mean “until the general term shall, after the Court of Appeals’ affirmance of the special term order, make final determination affirming the order.” I understand the plaintiffs make claim that “ final” means here “ upon remittitur from Albany and order of conformity entered below.” Were this possible, the language would be absurd : for it speaks of “ an appeal * * * to the Court of Appeals” subsequent to such “final determination.” But appeal to the Court of Appeals would be impossible after order of conformity pursuant upon remittitur. Moreover if the plaintiffs’ contention in that behalf is true, the words “ and in case of an appeal from the determination of the general term ” would be superfluous; for the greater includes the less, and the immediately preceding words, “until the final determination * * * by the general term,” would then include the utmost contingencies. But the bond does in fact, throughout, use the phrase “ final determination” in no such sense as that which the plaintiffs claim. It says “ the final determination by the Court of Appeals,” and it says “ in case said order be finally affirmed by the Court of Appeals ; ” in neither of which cases can the plaintiffs’ proposed interpretation attach. And in respect to the general term itself, the bond uses the phrase in a sense necessarily opposite to the plaintiffs’ proposed sense ; for it uses the words “within 30 days after the final affirmance by the general term, or, if an appeal be taken to the Court of Appeals, within 30 days after the final affirmance of said order by the Court of Appeals.” Here the ‘1 final affirmance by the general term ” is an affirmance that may be followed by an appeal to the Court of Appeals, and consequently is not an affirmance which is “final ” in the sense that it is “after remittitur from the Court of Appeals.” Besides, the word “ or ” imports an alternative. If “ final affirmance by general term” is here meant to include a case of previous determination by the Court of Appeals, the function of the word “ or ” is destroyed. The probable reason for using the word “final is in order to provide for such a contingency as where the general term might make a determination which would not finally determine the matter, as, for example, a determination referring the matter for further evidence, etc.; with perhaps some general instructions to be pursued by the special term ; and perhaps from the special term’s ordered thereon, the defendant might make an interlocutory appeal to the general term. In any such case the stay ought to hold, and the bond therefore ought to hold beyond such interlocutory determination ; ought to hold until a “final” determination. Likewise, the word “ final” includes a casein which the special term order would be modified, and yet, as modified, affirmed. Moreover, the order itself, contains no trace of such a meaning for the word “ final ” as the plaintiffs claim for it. In its parallel passage that order says merely, “ In case the said order appealed from shall be affirmed by said general term.” If the plaintiffs say that the special term purposely caused the bond to vary from the order, considering the order to be defective, a sufficient answer is that so far from indicating this, the bond expressly refers to the order as its fons et origo, and purports to follow strictly the order.
    III. Robinson v. Plimpton, 25 N. Y. 484 ; Smith v. Crouse, 2k Barb. 434; Hinckley v. Kreitz, 58 N. Y. 583; Gardner v. Barney, 24 How. 467 ; Bennett v. Brown, 20 N. Y. 99; Traver v. Nichols, 7 Wend. 434; Ball v. Gardner, 21 lb. 270; Tibbles v. O’Connor, 28 Barb. 538, are not in point as authorities in favor of plaintiffs contention. (Here counsel commented on them) A radical distinction is to be drawn between the statutory undertaking, and a bond, like this one, required “ as the condition of a favor.” Rice v. Whitlock, 16 Abb. 225.
    
      A. D. Williams, attorney and of counsel, for defendants Rogers and Horton.
   By the Court.—O’Gorman, J.

This action being now pending, this is a submission, under sections 1279, et seq., of the Code, on an agreed case of a controversy arising from the differing opinions entertained by the parties plaintiff and defendant, as to the true meaning, force and effect of a certain bond with sureties, given'by defendant Rogers, under order of the Supreme Court, as a condition for the discharge of a levy made under judgment and execution against Rogers, in favor of the plaintiffs for the sum of $7,938.53, with interest and costs.

The plaintiffs claim that this • bond is now in full force." The defendants deny the claim.

On issue of execution and levy made on the property of “ Rogers,” he moved at the special term of the Supreme Court, for the vacation of the judgment and execution. His motion was denied. From this decision, he appealed to the general term, and also moved in the special term for a stay of plaintiffs’ proceedings pending that appeal. This motion was granted and “ Rogers” obtained an order staying the plaintiffs’ proceedings, and discharging the levy pending the appeal to the general term, and also pending such appeal as might be taken to the Court of Appeals, on the condition of his giving a bond with sureties. -The bond was given under the approval of the court, and the contention now is as to the true intention and legal effect of that bond. The Supreme Court, at general term, reversed the order of the special term, and set aside the judgment against “ Rogers.” From that decision the plaintiffs appealed to the Court of Appeals, who reversed the decision of the general term of the Supreme Court and restored the judgment and execution against Rogers to their former force and effect.

The defendants now claim that the liability of the sureties on the bond was discharged by the judgment of the general term, setting aside the judgment against Rogers, and that plaintiffs can maintain no action against the sureties.

The plaintiffs, on the other hand, contend that the bond and all its obligations continued in full force and effect during all the litigation in the Court of Appeals, and on the decision of that court reversing the decision of the general term and reinstating the judgment against Rogers and the execution against his property, they were intitled to demand the fulfillment of all the provisions of that bond, in their favor, and to compel the sureties to pay tho amount of the judgment, etc.

The condition of the bond is as follows :—“ That whereas, the above bounden William C. Rogers has appealed to the general term of the Supreme Court of the state of New York, First Department, from an order made and entered on the 28th day of October, 1887, in an action in the Supreme Court of the state of New York, wherein Francis Pares Osborn, and others, are plaintiffs, and the said William C. Rogers, defendant, which order denies the motion made by the said Rogers to vacate the judgment entered in said action on October 17th, 1887, and to set aside the execution issued thereon.

“ And whereas, a motion has been made by said Rogers for a stay of proceedings pending said appeal and to discharge the levy under the execution issued upon said judgment upon such terms as to the court may seem just, and the court having ordered such discharge of levy and a stay of proceedings until the final determination of the defendants’ said appeal from said order by the general term, and in case of an appeal from the determination of the general term to the Court of Appeals, then until the final determination of the Court of Appeals upon such appeal, then, that in case said order appealed from shall be affirmed by said general term, and if an appeal be taken from the determination of the general term upon such appeal to the Court of Appeals in case said order be finally affirmed by said Court of Appeals the defendant William C. Rogers shall well and truly pay unto said Francis Pares Osborn, Charles Spencer Osborn, William Osborn, and Robert Arthur Osborn, any and all sum or sums which may be or shall be due, owing and unpaid upon said judgment, and the fees of the sheriff under said execution, with interest upon such sum or sums unpaid, and sheriff fees and all costs of appeal that may be awarded to the plaintiffs, within thirty days after the final affirmance by the general term, or if an appeal be taken to the Court of Appeals within thirty days after the final affirmance of said order by such Court of Appeals, then this obligation to bo void otherwise to remain in full force and effect.”

The language used might have been, no doubt, more clear, but, taking into account the circumstances under which it was executed, and the important advantages secured by defendant Rogers, because of its execution, I find little difficulty in arriving at the conclusion that the plaintiffs’ contention is right, and that the liability of the sureties on the bond to the plaintiffs, still exists, and the action on behalf of the plaintiffs against defendants is well brought.

In the endeavor to ascertain the meaning and purpose of a written contract, which, from the ambiguity or confusion of language may not be quite clear, a court is justified in seeking for such construction as may be the most reasonable, the most liberal and most consistent with the sense in which the promisor believed that the promisee accepted the promise, and in which he did actually accept it.

I entertain no doubt, that, in the case of the instrument here in question, the sense thus mutually understood by the parties was, that the bond should be and continue to be a valid and sufficient security for payment of the amount of plaintiff’s judgment, whether that judgment was sustained by the general term of the Supreme Court, or the decision of the Court of Appeals if the litigation reaéhed that court. If the intention of the parties to the bond was that the liability of the sureties was to end on the decision of the appeal to the general term, all allusion in the bond to the Court of Appeals would have been useless, idle and irrelevant. The allusion to the Court of Appeals clearly indicated that an appeal to that court was to be expected on the part of either party who might be dissatisfied by the decision of the general term. It is very unlikely that the intention of the parties was, that in case of a decision of the general term hostile to the plaintiffs’, they were to accept their defeat, or, if they sought redress by appeal to the Court of Appeals, carry on that litigation without any security from which they could realize any substantial benefit or protection.

It should be remembered that, at the time the the bond was executed, the plaintiffs had levied under the execution, on the goods of Rogers, and that, to the extent of the value of these goods, security, pendente lite, had been, in effect, given. By setting aside that levy, the plaintiffs were left without any security, unless such as was found in the bond. That whatever security was afforded by. the bond should cease to exist on the decision of the general term in favor of the defendant Rogers, would have left the plaintiffs without any security in place of the levy on the goods of Rogers, of which security he had been deprived by the order of the special term. That this injustice should have been intended by the court, or would have been acquiesced in by the plaintiffs, is not to be believed. No violence is done to the language of the bond by this holding, and the general drift of authoritative judicial opinion is in that direction. Robinson v. Plimpton, 25 N. Y. 484 ; Doolittle v. Dininny, 31 lb. 350.

The intention of all the parties was, in my opinion, that the plaintiffs were to receive, by means of the bond, a security which should be the full equivalent of the security they held by their levy on the goods of Rogers.

There should be judgment for the plaintiffs in form, and for the amount specified in folios 55 and 56 of the agreed case.

Sedgwick, Oh. J., and Freedman, J., concurred.  