
    Charles Smith, Pl’ff, v. The Emigrant Industrial Savings’ Bank, Deft.
    
      (City Court of New York, Special Term,
    
    
      Filed June 27, 1888.)
    
    
      1. Interpleader—When ordered under Code Civil Pro. § 820.
    The city court of New York, where a savings bank deposit is claimed • by a stranger and the bank is sued therefor by the depositor, may order the fund into court and direct an interpleader under section 820 Code ~ Civil Pro., substituting such claimant as defendant.
    2. Same—Jurisdiction of city court—When plaintiff not entitled to JURY TRIAL.
    The suit then becomes a controversy in equity between the plaintiff and the new defendant, triable to final judgment in said city court, which has jurisdiction to fully adjudicate the respective rights of the parties to the money so in court; and therein the plaintiff is not entitled to a jury trial.
    Motion for an order of interpleader and discharge pursuant to section 820 Code Civ. Pro.
    
      Richard O'Gorman, Jr., for def’t, for motion; J. P. Berg, for plt’ff, opposed; Morgan & Walker, for third party claimant.
   Pitshke, J.

This is an action at law to recover money deposited with the defendant, a savings bank, by plaintiff. Their relation is that of debtor and creditor. 2 Seld., 417; 6 Hill, 297.

A stranger to said defendant now (before answer) claims, by a notice served, to be entitled to said, money, and has forbidden any payment thereof by said bank to this plaintiff. Hence, the bank asks for an order of interpleader under section 820 Code Civ. Procedure. The plaintiff, the defendant, and said third party and claimant all appeared by counsel on the motion, and such claimant also submitted a proposed answer demanding said deposit as remaining as her property, and asking for an award thereof to her herein.

This is a proper case fora motion to interplead under said section 820. Norton v. Union Trust Co., 27 Week. Dig., 22; Bruggemann v. B'k Metropolis, 1 City Ct. R., 86;

Wehle v. Bowery 3. B'k, 8 Jones & Sp., 98; Barnes v. Mayor, 27 Hun, 240; Laws 1875, chap. 371, § 25. For the bank is put upon inquiry by said notice, and the fund in question may be impressed with a trust or latent ownership, which the defendant cannot disregard after notice received (Baker v. N. Y. Nat, Ex. B'k, 100 N. Y., 34), where held that “ bank having notice cannot appropriate the money to its depositor, even on depositor’s consent, to the prejudice of the actual cestui que trust.33

Said section 820 fully applies to the city court of New York. Section 3347, subd. 6 and subd. 4, also sections 3159 and 3160 Code Civ. Pro. The motion being proper in this court, it, if granted, must necessarily allow the case to proceed further in this court; for the court cannot, without a trial, relinquish or throw out a cause properly begun and pending, or decline its continuance (Alexander v. Bennett, 60 N. Y., 204, 207), and upon the granting of the inter-pleader this court must, therefore, have implied power to try the cause thereafter in the manner according to law —else, after the payment into court under the order of interpleader, plaintiff would be tied up in the suspended action and prevented from ever trying his suit, and should he then sue in another court he could there be met with a plea of “another like action pending,” or the bank would have to bring elsewhere an equity interpleader and pay amount into court a second time on plaintiff’s refusal to discontinue this action. The only other alternative, if this court could not proceed on an interpleader, is the view that an interpleader must in all cases be denied in this court—which course cannot be lawful, as it contravenes the operation of those Code sections expressly applicable to and giving this court power to grant interpleader motions in actions arising on contract or for a chattel in an appropriate case, and would nullify those sections.

It is therefore plain, interpleader cases should proceed on in this court after granting of the motion.

As now decided by the court of appeals under said section 820, after the new defendant is substituted and the amount or thing is deposited with the court or in its custody, the controversy between the plaintiff and the present defendant is at an end, and the action thereupon becomes an equity suit between the plaintiff and such new defendant, without any right to trial by jury, and in which a decree must be made. Clark v. Mosher, 107 N. Y., 118, 121; 11 N. Y. State Rep., 758. As this case must continue in this court on an interpleader order as above shown, the conclusion seems irresistible that this court thereafter acts therein as a court of equity does, with the complete equity powers in the particular action thenceforward.

This is the same consequence of a full equity jurisdiction as requisite in statutory interpleaders under said section 820, applied to this court by express statute, as was the like consequence of a full equity jurisdiction in mechanic’s lien cases in this court, conferred by simply giving the court, statutorily, jurisdiction in proceedings under the mechanic's lien statutes.

Since the enactment of the new Code, all the judicial proceedings (§ 3333) in this court under section 315 must be prosecuted to their end, without any distinction as between law actions and equity suits, or between the forms of those actions and suits as applicable to the case (§ 3339) and, consequently, the jurisdiction of this court is unbounded in that respect in all cases within section 315, except as limited by section 316, section 3159 and chapter 22 of the Code of Civil Procedure. The legislature could confer on it what jurisdiction it pleases while keeping it a local court. See Anderson v. Reilly, 66 N. Y., 189.

Not only in interpleaders under said section 820, and in mechanic’s hen and chattel hen causes, but this court clearly can also incidentally exercise appropriate equity jurisdiction, in the manner allowed by said Code, in every case properly begun wherein the complaint demands judgment for a sum of money only, similarly to the implied equity powers of the superior city courts in such last mentioned cases, provided only the relief in the judgment in the case is awarded in money, and provided the final recovery so awarded does not exceed $2,000, exclusive of interest and costs, where plaintiff is the successful party, except on certain special causes permitting a recovery by plaintiff or defendant in any amount (Code, §§ 315, 316, 3174), and it may issue injunctions under section 604; for it has recently been authoritatively held a complaint for a sum of money only will allow equity litigation for rehef in money. See also Sternberger v. McGovern, 56 N. Y., 21; and see 74 N. Y., 170; 71 id., 282, 283.

Our jurisdiction by the new Code, to determine such an aforesaid case between the parties is unrestricted, save as hmited in said- sections 316 and 3159 and chapter 22 Code Civil Procedure, and such jurisdiction is to be exercised without distinction in the procedure as between legal and equitable forms of proceeding in the case, inasmuch as section 3339 ordains there shall be only “one form of civil action,” embracing all legal and equitable causes of action and procedure between contending parties before the court.

The jurisdiction, legal and equitable, so directly allowed to this court by the legislature, carries with it the duty to exercise it when properly called on so to do. 60 N. Y., 207.

As it is strenuously urged that this court cannot proceed with this cause after payment of the money into court, pursuant to an order of interpleader under section 820 Code Civil Procedure, for alleged want of equity powers in the court to try herein the case between plaintiff and such claimant, I will grant the defendant’s said motion, without costs, but must (upon payment of said deposit into court) permanently stay all the plaintiff’s proceedings herein except to appeal from and review the order hereon. This course allows the court, at general term, as early as possible, to settle the law and practice in this court, as applicable to the matter herein, in the requisite ensuing proceedings touching the fund so ordered into court, and declare the proper procedure under the said section 820 in this -court, after modifying said order by vacating the stay against plaintiff, or to direct the return of such fund to the bank by the clerk if it is determined this court cannot on said order proceed with, the case as an equity litigation, under 107 N. Y., 118; 11 N. Y. State Rep., 758.

Ordered accordingly.  