
    Homer E. Dudley, Respondent, v. The Broadway Insurance Company of the City of New York, Appellant. Same, Respondent, v. The National Standard Insurance Company of New York, Appellant. Same, Respondent, v. The Insurance Company of the State of New York, Appellant. Same, Respondent, v. The Globe Fire Insurance Company of the City of New York, Appellant. Same, Respondent, v. Joseph C. Hatie Appellant. Same, Respondent, v. Joseph C. Hatie Appellant. Same, Respondent, v. William Adams, Appellant. Same, Respondent, v. Francis Hendricks, Appellant. Same, Respondent, v. The Mutual Fire Insurance Company of New York, Appellant.
    (No. 1),
    (No. 2),
    
      Amendnient of an answer — laches which justify its refusal — election to suffer default — when a party will not be relieved, therefrom.
    
    On the day specially set down, after several adjournments, for the trial of an action to recover upon a policy of fire insurance, and after the plaintiff had, at considerable trouble and expense, subpoenaed his witnesses, the defendant’s attorney made a motion to amend his answer, and upon the denial of the motion • permitted the plaintiff to take judgment by default.
    Upon an appeal from the order denying the motion to amend, and from an order denying a motion to open the default, it appeared that the facts upon which the proposed amendment was predicated had been considered in an action brought in a Canadian court, and that the defendant’s attorney, who was a lawyer of great experience in insurance cases, knew, or might have known, of such fact long before the application to amend was made.
    
      Held, that the exercise by the trial court of its discretion in denying the motion to amend would not be disturbed on appeal;
    That in view of the large experience of the defendant's attorney, his laches were not excused by the fact that it was not discovered, until a week before the motion to amend was made, that the defenses set up by the proposed amendment might be interposed with greater success in the present action than in the action in the Canadian court, because of a difference in the phraseology of the policies sued upon;
    That as the defendant’s attorney had deliberately elected, after consultation with his clients or their representatives, to suffer judgment to be taken by default, instead of excepting to the denial of tlie motion to amend and proceeding with the trial, the Appellate Division would not interfere with the refusal of the trial court to relieve him from the consequences of such election and open the default.
    Appeal by the defendant, The Breadway Insurance Company of the City of New York, from an order of the Supreme Court, made at the Erie Trial Term and- entered in the office of the clerk of the county of Erie on the 17th day of February, 1899, denying the. defendant’s motion to amend its answer, and also from an order made at the Erie Special Term and entered in said clerk’s office on the 5th day of May, 1899, denying the defendant’s motion to open its default.
    This is one of several actions brought upon policies of fire insurance issued by various companies and Lloyds associations, insuring against loss or damage by fire the stock of goods and merchandise owned by “ The John Eaton Company, Limited,” a corporation owning and conducting a department store at Toronto, Canada.
    On May 20, 1897, the store occupied by the company, together with nearly its entire contents, was destroyed by fire. The insurance carried by the company at the time of the fire amounted to $219,540, of which about $60,0(p0 was- in Canadian companies, $50,000 in English companies and $109,000 in American companies.
    Shortly after the fire the representatives of the Canadian com- ■ panies met and appointed an experienced adjuster by the- name of Edwards to adjust the loss on their behalf ; and he, in connection with another man of like experience by the name of Howley, who represented the defendant as'well as other American "companies and Lloyds associations, made a thorough investigation of the origin of ' the fire and of the loss which resulted therefrom.
    On the 22d day of May, 1897,; two days after the fire, all the policies were assigned by The John Eaton Company, Limited, to the Bank of Toronto, and thereafter the policy in suit, as well as those issued by certain other companies, was assigned by the bank to the plaintiff, Homer E. Dudley.
    On the 2d day of June, 1897, the proofs of loss were made and sent to the various companies ; a bopy was also furnished to both Mr. Edwards and Mr. Hówley, and at their request all books and papers .of The John Eaton Company, Limited,. which were then in existence, were submitted to them for their examination. After spending nearly two months investigating the loss the adjusters above named denied any liability upon the part of their companies, and refused to make an adjustment, whereupon suits were commenced in Canada against such companies and Lloyds associations as could be served with process there, and in the latter part of March, 1898, this action, together with eight others, was commenced in the Supreme Court of this State.
    The answer herein was served on the 14th day of May, 1898, and the case was upon the calendars of the-May, September and November Trial Terms of that year held in Erie county. Prior to the last-mentioned term it was arranged between counsel that all the cases, should be tried together before Justice Childs, ivithout a jury, at such time early in the month of December following as the learned justice might name. Later on December twelfth was designated as the day for the trial to commence, at which’time the plaintiff was ready to proceed therewith, but a postponement became necessary on account of the illness of a son of the defendant’s attorney.. The term was thereupon continued for the express purpose of trying-these cases, and after some correspondence between counsel January 23, 1899, was agreed upon as the time for the trial. On the-last-named day it was found that the plaintiff’s counsel ivas engaged at the Court of Appeals- and the term was continued for his accommodation until the twenty-fifth day of January. In the meantime the defendant’s attorney, who resided in the city of New York, had become engaged in another important trial and the cases were turned over to local counsel.
    On the 25th day of January, 1899, the parties finally met in court,, the plaintiff being ready and anxious for the trial to proceed; the defendant thereupon asked permission to amend its answer and submitted the proposed amendment thereto, which covers nearly twelve-pages of the printed record. It was then agreed' by counsel that, the motion for leave to amend might be made then and there with the same force and effect as though made at Special Term. The court assenting to this arrangement, argument was had and the-application was denied. The counsel for the defendant thereupon withdrew from the cases and suffered judgments to be taken by default.
    
      The order denying the motion to amend provided that each counsel' might file an affidavit setting forth the grounds upon which the motion was made and opposed, and that such affidavits, together with the pleadings and proposed amendment, should be regarded as the papers upon which the ordef was made. Subsequently, upon the same papers and several additional affidavits, a motion was made by the defendant at Special Term; to open the default, which motion rvas denied, and from the order denying the same, as well as from . the order denying the motion for leave to amend, appeal was duly taken.
    Similar appeals were taken by the defendants in the other aboveentitléd actions.
    
      Adelbert Moot and Michael H. Cardozo, for the- appellant in each case.
    
      John G. Milburn, for the respondent.
   . Adams, J.:

The voluminous records filed .in this court and the elaborate briefs submitted by counsel would seem to indicate that the questions which they present for our consideration are exceedingly complex in their nature. Important, and vastly important, to both parties. these, questions doubtless are; but upon, a careful perusal of the various affidavits and of the exhibits therein referred to, that which before appeared involved and intricate becomes exceedingly simple and virtually resolves itself into this single inquiry: Did the trial court, in denying the defendant’s motion for leave to amend its answer, so exercise its discretionary power as to justify this court in declaring that the same had been abused ?

In answering this inquiry, we do not deem it necessary to determine whether or not the proposéd amendment, if allowed, would have enabled the defendant to avail itself óf a new and substantial defense, and one which, if established, would be likely to defeat a recovery by the plaintiff; for, unless .a proposed pleading is obviously bad or frivolous, its sufficiency will not be determined upon an application for leave to serve the same, but the other party will be left to his remedy by demurrer or motion at the. trial. (Campbell v. Campbell, 5 N. Y. Supp. 171; Paddock v. Barnett, 88 Hun, 381.)

Assuming, then, for the purposes of this review, that the .proposed amendment tendered new and meritorious issues, what were the circumstances under which leave to serve the. same was denied ?

As has already been stated, issue was first joined herein by the service of the defendant’s original answer on the 14th day of May, 1898, more than eight months prior to the time when the motion to amend was made. This answer was drawn by an attorney of conceded ability, and one whose large experience in the conduct of insurance cases certainly qualified him to draw such a pleading intelligently and skillfully. At that time one of the Canadian cases had been tried, and upon the trial the transactions upon which the defenses set forth in the proposed amendment are predicated were gone into at length and with great detail; they were also critically and elaborately considered in the opinion of the learned judge before whom the case was tried, and a copy of that opinion had been furnished to and was then in the possession of the defendant’s representative, who was charged with the duty of preparing this case for trial.

In October, 1898, the same matter was considered and passed upon before Sir W. R. Meredith, Ch. J., in another hearing in a Canadian court, so that long before the application to amend was made the defendant’s attorney was, or might have been, fully possessed of all the facts and circumstances which were necessary to enable him to formulate the proposed amendment; and yet no sign was made that any amendment was deemed necessary until the parties and their witnesses had assembled for the trial upon a day fixed by mutual conference and consent to accommodate both court and counsel.

It is urged, however, that the defenses which proved unavailing in the Canadian courts may be interposed with' greater assurance of success in this action, by reason of the fact that the provision of the policy issued by the defendant, relating to the material changes in the risk assumed, is different and more favorable to the defendant’s contention than the provision contained in the Canadian policies, which fact was not discovered until after the case had been placed in charge of the present counsel. But conceding this to be true, does it furnish an adequate excuse for the defendant’s laches ?

The attorney of record, as has been suggested, has had large experience in matters of this character, and he certainly ought to have discovered every defense which was available to the defendant before allowing the case to leave his hands, as • he probably would have done had he displayed! the same zeal and effort as did the present learned counsel, who was not retained in the case until about a week before the application for leave to amend was made.

A labored - attempt was made to: excuse this oversight or omission upon the part of the attorney, and to that end various explanations were tendered which, while they did not exonerate him from the charge of laches, might, under different circumstances, have been regarded as sufficient to warrant' the granting, upon proper terms, of the relief sought. But when the application for leave'to amend was made, the plaintiff was in readiness for trial, and had, at considerable trouble and expense, subpoenaed a large number of witnesses to be present at a time which had been set apart by the court for the express purpose of trying these cases. Under these circumstances, it is not surprising that the defendant’s application was not regarded with more favor by the learned trial judge'. ' We have said that the defendant’s laches under different circumstances might have been condoned, and it- is quite possible that an appellate court might think it would have been better, even under existing conditions, to have exhibited more lenity; but the learned trial justice' was in a "position, by reason of his familiarity with all the surrounding facts and circumstances, to determine that question intelligently and discriminatingly, and as such determination rested almost entirely in his discretion, and as we are unable to say that in this instance there was any abuse of that discrbtion, we do not feel at liberty to reverse the order appealed from. (Sayre v. Frazer, 47 Barb. 26 Dennis v. Snell, 54 id. 411; Lamphere v. Clark, 29 N. Y. Supp. 107; S. C., 77 Hun, 506; revd., 149 N. Y. 472; O’Neil v. Hester, 82 Hun, 432.)

As regards the second order, but little need bé said. When the motion to amend was denied, the defendant’s counsel was at liberty to pursue either of two remedies; he might have excepted to the decision of the learned trial justice, proceeded with the trial, and, if defeated, availed himself of his exception upon appeal, or he might have abandoned the cases and suffered defaults to he taken. This latter alternative he saw fit to adopt, and later on, having become convinced that his course was unwise, he made application to he relieved from the consequences of his “ mistake.”

The papers upon which this second order are based are obviously designed as a supplement to those used upon the former motion, and they do contain some additional statements which are relied upon to excuse the defendant’s laches, but these statements simply show that the attorney of record was not aware of the existence of certain facts which the present counsel discovered as soon as the case was committed to his charge. Théy fail, however, to show that any very diligent effort ivas made by the attorney to inform himself as to the real situation of affairs, and consequently the case, so far as this feature of it is concerned, was virtually the same upon the second as upon the first application. The only question, therefore, left to be determined was whether the judgments which were allowed to go by default should be vacated. To this proposition the Special Term, in the exercise of its discretion, responded in the negative, and with such response we are indisposed to interfere. The determination to abandon the cases was made deliberately by an able, experienced and astute officer of this court, after consultation with his clients or their trusted representatives, and having thus made his election, it would be a travesty of justice to permit him to reconsider his action after the plaintiff had made his proofs and dismissed his witnesses.

Each of the orders appealed from should be affirmed, with ten dollars costs and disbursements.

All concurred, except Hardin, F. J., not voting.

Order denying motion to amend answer affirmed, with ten dollars costs and disbursements. ■ •

Order denying motion to open default affirmed, with ten dollars costs and disbursements.

Like order in eight other cases in which same plaintiff appears.  