
    SHARP a. THE MAYOR, &c., OF NEW YORK.
    
      Supreme Court, First District;
    
    
      At Chambers, October, 1859.
    Constitutional Law.—City of New York.—Motion by Comptroller TO SET ASIDE JUDGMENT AGAINST THE ClTY.-ATTOR-NEYS for the Corporation.
    
    The act of 1859 (Laws of 1859, 1127), entitled “ an act to enable the supervisors,” &c., “ to raise money by tax,” is not unconstitutional, although it also contains provisions allowing the comptroller of the city of New York to proceed to open and reverse collusive or fraudulent judgments against the city. Such provisions are properly inserted as being incidental to the main purpose of the act.
    This statute should be construed liberally.
    It is not requisite in an application by the comptroller under this act, that his affidavit should show the grounds of his opinion as to the existence of fraud or collusion. It is sufficient if his affidavit states that he ‘ ‘ believes that the claim on which the action was based is unfounded and fraudulent.” This establishes the right of the comptroller to make the application, and to employ special counsel therefor.
    
      On a motion under the statute to open a judgment, the adverse parties will not be ordered to supply the comptroller with the papers in the case until it be shown that upon request they have refused to do so.
    The referee before whom the cause was tried should not be ordered to furnish a statement of the case and the grounds of his opinion. Such a statement could not be deemed evidence. The proper mode is by proceeding to obtain his testimony as a witness.
    
      Motion to compel a referee to prepare a statement and case, and the other parties to furnish the necessary papers therefor.
    This was a proceeding instituted under chapter 489, of the Laws of 1859, by the comptroller of the city of ¡New York, to open a judgment recovered against the city.
    The action was by a lessee of a ferry to recover from the Corporation, the lessor, damages for an alleged failure of title. The cause was referred upon the plaintiff’s affidavit that the trial would occupy a long time, and that a number of separate and distinct facts would have to be proved on the part of the plaintiff by a large number of different witnesses. The referee found for the plaintiff for $40,953.56, for which, with costs, &c., judgment was entered.
    The comptroller upon affidavit applied to the court under the act of 1859 (ch. 489), and obtained an order requiring the plaintiff to show cause why the judgment and order of reference should not be set aside.*
    
      The comptroller’s attorneys applied to the referee to furnish them “with a statement of all the evidence given on the hearing, whether oral, written, or documentary, and all the admissions made thereon by the counsel on each side, with all objections, rulings, and exceptions, made and taken on the hearing; so that the said statement may form a complete case, such as would be made on reviewing the decision of the referee in the said action, including the points of the counsel on each side, and the names of the counsel who appeared on each day, and from day to day, for the respective parties, on the hearing the case or statement to be used on the motion to open the judgment.
    This the referee declined to do, stating that the only papers he had were his rough minutes of the trial, all other papers and exhibits having been returned to counsel at the time of the report ; and that as he must be further called on to act judicially in the case, it would not be proper for him to part with his minutes, or furnish copies of them to use in the controversy; but that the counsel in the cause would undoubtedly furnish them.
    The attorneys retained by the comptroller then obtained an order that the referee and the Corporation counsel show cause why the referee should not prepare and deliver to them, the statement and case requested, and why the plaintiff and the other parties to the action, should not furnish to the referee copies of all pleadings, papers, writings, and documents in their possession or under their control, to enable him to make the statement or case within two days, and why the original motion should not be postponed until such case had been prepared.
    
      William Curtis Noyes, for the motion.
    
      
       Tun Mayor, &c., of New York a. The Exchange Fire Insurance Company (New York Superior Court ; Special Term, June, 1859).—In this cause Messrs. Mann & Rodman appeared as attorneys on the record for the plaintiffs ; and the defendants moved to dismiss the complaint or for a stay of proceedings, upon the ground, among others, that the Corporation counsel alone had authority to maintain the action.
      
        J. M. Mason, for the motion, urged that by law no person could appear for the plaintiffs except the counsel for the Corporation, elected by the people, and that the defendants would not be protected by a judgment obtained, and if the defendants should pay the loss to any other attorney, the defendants would still be liable.
      
        Mann & Rodman, opposed.
      Hoffman, J.—The main ground relied upon is, that Mann & Hodman, the attorneys on the record for the plaintiffs, are not authorized by law to appear for such plaintiffs ; that the Corporation counsel is the only person so authorized ; and that Richard Busteed, Esq., is such counsel.
      It appears by the affidavit read in opposition, that the present attorneys have the authority of the mayor and comptroller for appearing in the action, and that Mr. Busteed has given his assent thereto in writing. Such assent has been produced, and it is as follows :
      “New York, June 6, 1859.
      “ Messes. Wakeman & Latting,
      “ Gentlemen :—In reply to your note, under the date of May 31st, I beg leave to inform j'ou that Messrs. Mann & Rodman are fully authorized to represent the city, in the suits now pending against ■ certain Insurance Companies, for underwriting the Crystal Palace, and their legal acts in the premises will be approved of by me.
      “ Respectfully, Yours,
      “ Richard Busteed,
      “ Corporation Counsel."
      By the charter of April 14th, 1857, there was created an executive department of the Corporation, known as the law department, which should have the charge of, and conduct all the law business of the Corporation and of the departments thereof, and all other law business in which the city shall be interested, and the chief officer thereof should be called the counsel to the Corporation (§ 20). Such counsel was to be elected by the people (§ 10), and to hold for a given term, unless removed for cause. Richard Busteed now fills, and did fill, such office at the institution of this suit.
      By section 28, “the.Common Council was empowered to establish other bureaux as they may deem the public interests may require, and to assign to them and to the departments and bureaux herein created such duties as they may direct, not inconsistent with this act; and the duties thereof shall be performed in accordance with the charter, and laws and ordinances of this city."
      Ho ordinance establishing or defining the powers of the law department, or the powers of its officers, has been produced. I am not at liberty to notice any which may exist. It may be that the Common Council have expressly, or by a warrantable inference, authorized the counsel to delegate his power to appear to another. I must assume that the present counsel considers that he does possess that authority, and I have nothing before me to justify the conclusion that Ms view of his official duty is incorrect. The argument, therefore, that he is clothed with a trust of office which he cannot give to another, so far, at least, as an appearance on the record is concerned, cannot avail.
      Motion denied, without costs.
      ° The allegations of the affidavit made by the comptroller were as follows:
      “ That he has been comptroller of the city of Hew York since the 1st of January, 1859 ; that he has been informed and believes that a judgment has been recovered in this action for the sum of 41,425 dollars and 88 cents, on the 1st day of June, 1859, as appears by the record of the judgment; that the action was commenced before this deponent cartie into office, and appears to have been referred on the 18tli September, 1858, to M. Gr. Harrington, Esq.
      “ That no consent appears to have been given to the reference, and deponeut believes that none was given ; that the defence of the action was managed by the Corporation counsel and liis assistants, and that he has declined, although requested by deponent and the mayor, to make a case or bill of exceptions, or to take any other steps to review the decision of the referee ; that an execution has been issued upon the judgment, and is now in the hands of the sheriff, who has levied upon, and is threatening to advertise, the property of the city, to satisfy the judgment; that deponent believes that the claim, upon which the action was based, is unfounded and fraudulent; that a good defence existed, and still exists, against the same ; that the said defence was not properly or fully brought before the referee, and that the recovery of the said judgment requires the action of this deponent, as comptroller, under, and that it is a case within, the fifth section of the act, entitled “ An act to enable the Supervisors of the City and County of Hew York to raise money by tax,” passed April 19, 1859, and that the said judgment ought to be set aside, or its execution suspended, and the defendants permitted to defend the action anew.
      “ Deponent further saith, that the resolution reducing the rent of the ferry in question, in this action, was passed upon the application of the Ferry Company hereto annexed, and was in writing, and that reports were made upon it in both branches of the Common Council. That although the resolution in itself was given in evidence before the referee, yet, neither the said application, nor the said reports, nor the proceedings of the Common Council leading to the resolution, were given in evidence.
      “ That deponent is advised and believes, that all such evidence was competent and admissible, and ought to have been put in ; and he is also advised by William Curtis Noyes, of the city of New York, that the defendants have a good and substantial defence upon the merits of the said action, and he verily believes the same to be true. And that deponent, under and by virtue of the said fifth section of the said act, has retained the law-firm of Tracy, Powers & Tallmadge, of which the said Noyes is a member, to take all proper and necessary means to open and reverse the said judgment, and to use the name, of the said Mayor, Aldermen, and Commonalty for that purpose.
      “ And this deponent further saith, that Schedule A, annexed hereto, is a copy of the application to the Common Council mentioned in this affidavit; Schedules B and 0 are the proceedings of the Board of Aldermen and Assistant Aldermen upon the said application, including the reports of the committees, to which the same was referred, and that the same have been taken from the files, and from the printed proceedings of the Common Council.’ ’
      Accompanying this affidavit was one made by the mayor of the city, in corroboration of it.
      The order to show cause was in the following form :
      “ On the pleadings in this cause, the order to refer, and the papers on which the motion to refer was founded, on the judgment-roll, filed therein, and the report and finding of the referee on the affidavits and papers hereunto annexed, and on such other affidavits and papers as may be served upon the plaintiff’s attorneys within two days prior to the time of hearing herein mentioned, let the plaintiff and his said attorneys show cause before one of the justices of this court, at chambers, on, &e., why the judgment entered in this action should not be set aside and vacated, why the order of reference therein should not be set aside, why the defendants therein should not be permitted to file a further or amended answer to the complaint in this action, and why the issues joined in the said action should not he tried by a jury, or for such other or further order as the said court may deem meet.
      “ And in the mean time, and until the hearing and determination of the motion under this order, let all proceedings upon the execution issued upon the said judgment be stayed.”
    
   William Fullerton,

for the Corporation counsel (who also appeared in person), read in opposition to the motion, letters between the comptroller and the counsel to the Corporation respecting the judgment, in which the former said that in reference to the question of collusion or fraud, he knew of no facts going to establish either conclusion, nor could he show that any fraud or collusion was perpetrated in procuring the referee’s report.

Darnel Dudley Field,

for the plaintiff, objected that the fifth section of the act under which the proceedings were taken, was unconstitutional as without the scope and the title of the bill. If valid, still the court could not under it supersede the counsel for the Corporation in the case, until convinced that there was fraud or collusion.

Ingraham, J.

The attorney on the record ceases to act, on judgment being obtained, and cannot appear after judgment on his original authority.

Mr. Field.

But again, the time for appealing has expired (Code, § 268), and even if Mr. Busteed should move for it, it would be too late to order a case to be made. The main question is as to fraud.

Ingraham, J.

That is not the question. The counsel asks for a statement and case, not for appeal, but in order to bring the matter before the court; and the question is, not as to whether he has shown any grounds for his belief that the judgment was fraudulent and collusive, but whether the court shall now order a statement to be made in order to bring the facts before the court.

Mr. Field.

But I submit that you have no power, sir, to grant such an order. You have no power to order a party to produce again, at this distance of time, books, or other evidence produced by him on a tidal or before a referee, when the paper has done its office, and the case passed to judgment. If the comptroller wishes any thing, he may procure it by a commission or by a subpoena.

Mr. Noyes (in reply),

as to the constitutionality of the act, cited Sun Mutual Insurance Company a. The Mayor, &c., of New York, 8 N. Y. (Seld), 241.

Ingraham, J.

In this case a judgment was recovered against the defendants for damages, in consequence of a defect of title to certain portions of the slip now used for the Wall-street ferry, amounting to $40,953.56.

The comptroller of the city now moves for an order to open and review the judgment, under the provisions of the statute passed at the last session of the Legislature.

The present motion is a preliminary one, asking for an order requiring the referee to furnish a statement and case showing the proceedings before him on the reference in this action.

The plaintiff and defendants, by their counsel, object to the authority of the comptroller to make this application on these papers.

This objection involves a construction of the statute under which the application is made. By this statute (Laws of 1859, 1127, ch. 489, § 5), it is provided as follows : “ Whenever the comptroller of the said city shall have reason to believe that any judgments now of record against the mayor, &c., of ISTew York, or which may hereafter be obtained against them, shall have been obtained by collusion or founded in fraud, he is hereby authorized and required to take all proper and necessary means to open and reverse the same,” &c.

The first objection taken to this motion is that the act is unconstitutional, because it contains matters not embraced in its title. The title is “ An act to enable the supervisors, &c., to raise money by tax.”

The second section provides for raising money to pay judgments then existing; the third section provides for raising money to pay judgments thereafter to be recovered.

It was necessary in making such provisions to enable the proper officers of the city to guard against the application of such moneys to the payment of any other judgments than those which were legally a charge against the city. The mode adopted for that purpose was immaterial. Whether the comptroller or any other officer was authorized to ascertain that such judgments were properly recovered before payment, it was a necessary incident to the previous provisions for their payment, and was intended to confine such payments to judgments fairly recovered against the city.

It was not a different subject, but a provision by which the city authorities, before paying the moneys to be raised by tax, should have the means of ascertaining that the judgments so paid were really due.

It was no more a violation of the constitutional provision on that subject, to provide for ascertaining before payment that the judgment was a valid judgment, than it was to insert a provision that the moneys so to be raised by tax should not be expended for any other purposes.

Both provisions were proper and necessary to confine the payments of the tax to the objects for which the moneys were intended to be raised. (8 N. Y. (4 Seld.), 241.) It is also objected, that on the papers presented, the comptroller does not show a case entitling him to employ other counsel than the counsel for the Corporation.

The affidavit on which this motion is founded is made by the comptroller, and states the recovery of the judgment on the report of the referee ; that no consent was given to the reference ; that the Corporation counsel has declined to make a case, or bill of exceptions, or to take any steps to review the decision of the referee; that he believes the claim on which the action was based, is unfounded and fraudulent, and that a good defence exists thereto. He further states that the recovery of such judgment requires the action of the comptroller under that statute, &c.

The right to make this application and to employ special counsel therefor, depends upon this fact only, viz.: Whether the comptroller has reason to believe that any such judgment has been obtained by collusion, or founded in fraud. What has caused such belief is not required to be stated, nor is it necessary for him to disclose, as a preliminary statement to authorize him to act, what was the operation of his mind in arriving at such a conclusion, nor what acts particularly led him to such a belief. The words used are so indefinite as almost to amount to an authority to the comptroller to act on his own judgment in any case.

Whether it is necessary for him to show by affidavit that he has come to the conclusion that there was collusion or fraud, is hardly necessary to be decided now. But considering that the comptroller is a sworn officer of the city; that the statute is a beneficial one, intended to protect the treasury against fraud, and only reaches judgments obtained by collusion- or fraud, in my judgment it should be very liberally construed.

The application of the comptroller under such circumstances, even without an express charge of collusion or fraud, should be considered sufficient evidence, that he has reason to believe that the case on which he makes the motion, comes within the provisions of the statute.

In this case, however, the affidavit of the comptroller shows affirmatively that he has reason to believe that the claim is founded in fraud, because he says in that affidavit—“ that deponent believes that the claim upon which the action was based is unfounded and fraudulent.”

Such a statement is amply sufficient to enable him to take the necessary steps to move the court, as is provided for in that statute.

The object of this motion is to compel the referee to make a statement or case, of the proceedings before him, and to furnish copies of the pleadings, papers, &c., used in the cause—or to compel the parties to furnish such copies.

I am not satisfied that such a case could properly be made for such a purpose.

The statute has provided a way in which the referee can be compelled to give evidence of any matter within his knowledge (if he refuses to do it voluntarily), by compelling him to appear before-a judge of the court, or a referee, and submit to an examination under oath.

For the purpose of a motion, such is the only course which appears to be proper to obtain his testimony—a statement made by him not under oath, could hardly be proper to be used as evidence. It is not within the ordinary duty of a referee, and could not be considered as rendered under the oath he took as referee.

Nor do I think the papers show a case warranting the order asked for against the parties as to copies of the papers. No application appears to have been made to the Corporation counsel for such papers. They are public documents, most, if not all, of them properly belonging in the department of which the comptroller is the head, and I cannot suppose that the Corporation counsel would for a moment refuse copies of such papers to the comptroller if he applied therefor.

It is apparent from the correspondence which was read on this motion, that there was a diiference of opinion between these officers as to the precise mode in which the comptroller should proceed, and from an unwillingness on the part of the counsel to allow another officer of the city government to control him in the management of what peculiarly belonged to his department, unless in the matters particularly provided for by law.

As that point has now been adjudicated by the court, I should be unwilling to believe that officer would refuse on application, on behalf of the comptroller, for such papers; but on the contrary, as avowed on the motion, that he will furnish to the counsel all such papers on application therefor.

The plaintiff’s counsel also referred to an opinion expressed by the comptroller, in one of his letters addressed to the Corporation counsel, in which he stated that he did not know of any facts going to establish collusion or fraud, and urged that as a reason why this motion should be denied. It is sufficient to say, in answer to that objection, that such letter was written in July last.

What other facts have come to his knowledge since are not known, but when he states under oath that he believes such claim is unfounded and fraudulent, I am bound to suppose that since writing that letter he has obtained information justifying him in making that allegation. My conclusions in regard to this statement are—

1. That the statute does not require that the comptroller should show by affidavit the grounds on which his opinion was formed of the existence of collusion or fraud.

2. That the act being one for the benefit of the public, and intended to .prevent fraud, should be liberally construed.

3. That the making of the application by the comptroller, he being a sworn officer of the city, should be considered sufficient evidence in itself that he has reason to believe that the cause existed which the statute required to warrant his action.

I have avoided the expression of any opinion on the merits of this motion, because the same was not argued before me, and such opinion more properly belongs to the judge before whom the motion shall be brought on. I think, however, so much of the motion as asked for a postponement of the argument upon the merits, until the necessary evidence from the referee can be obtained, should be granted.

To enable the counsel for the comptroller to obtain such evidence, the other motion should be directed to be heard on the 15th of November next, at 12 m. Copies of all affidavits and papers to be used thereon, in addition to those already served, to be served on plaintiff’s attorney four days prior thereto.

Ko costs granted on this motion.  