David Stevenson Brewing Company, Respondent, v. Ernst Malkmus, Appellant

David Stevenson Brewing Company, Respondent, v. Ernst Malkmus, Appellant. M$idonae-~- proof that a party in giving a chattel mortgage acted as the agent fof another and was not to he held liable for the debt, when insufficient—statement of ait, attorney’s clerk. In an action brought to recover the amount of a deficiency arising on the foreclosure of a chattel mortgage, it appeared that the plaintiff, a brewing company lor whom the defendant was engaged in soliciting business on commission, informed a customer introduced by the defendant that, under a rule of the ' brewers’ hoard of trade, it would he unable to deal with him as he was indebted Í0 Other brewers, hut that the difficulty could be obviated if he would give the defendant a hill of sale of the business and put the licenses in the latter’s name, which was thereafter done, a check being drawn by the plaintiff to the order •of the defendant, who used it in the purchase of a saloon, which the customer bad agreed to buy, and executed to the plaintiff his note and a chattel mortgage covering the property in the saloon to secure the moneys so advanced, The defendant testified that a clerk in the employ of the plaintiff’s attorney, in whose presence the mortgage was executed, told the customer, at the time of snob execution, that the mortgage was only a matter of form and that the customer was the man who was to keep the place. Meld, that the evidence tending to show that the parties understood that the customer and not the defendant should be liable on the' note and chattel mortgage, was not sufficient to relieve the defendant from his express contract to pay contained in the instruments; That, assuming the representation made to the customer by the clerk of the pkititiff’s attorney to be available to the defendant, the plaintiff was not chargeablé , with such representation in the absence of evidence of the clerk’s authority to make it. . Appeal by the defendant, Ernst Malkmus, 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 10th day of March, 1899, upon the verdict of a jury rendered by direction of the court, and also from an order entered in said clerk’s office on the 29 th day of March, 1899, denying the defendant’s motion for a new trial '(made upon the minutes. Henry M. Dater, for the appellant. Louis J. Somerville, for the respondent. [MAJORITY — Van Brunt, P. J.:] Van Brunt, P. J.: This action was brought to recover the amount of a deficiency arising under the foreclosure of a certain chattel mortgage made by the defendant to the plaintiff of certain chattels in a liquor store. It appeared that on the 10th of December, 1895, the defendant executed to the plaintiff a note for the sum of $1,100 due on demand, and at the same time executed a chattel mortgage under seal as collateral security therefor on the fixtures in the above-described place. This mortgage was foreclosed and there was a deficiency upon the sale of the chattels described in the mortgage, and this action, as already stated, was brought to recover such deficiency. The defendant claimed that it was understood between himself and the plaintiff that he was not to be personally liable upon the note -and mortgage in question, but that the real party who was to answer to the plaintiff was one Henry Widder. It appeared upon the trial that the defendant had been employed by the plaintiff to collect for it and to bring in new trade. Prior to December 10, 1895, the defendant brought to the plaintiff as a customer the said Widder, but the plaintiff stated that it could not deal with him because he was - indebted to other breweries, and it was against the rules of the brewers’ board of trade to take a customer who was-indebted to other companies belonging to the board; that the only way in which it could take Widder as a customer would be by paying his debts to the other brewing companies. The superintendent of the plaintiff stated to the defendant that the plaintiff was unwilling to pay Widder’s deficiency. Some conversation being had between the plaintiff’s superintendent, the defendant and Widder, the superintendent asked Widder if he would have any objection to giving the defendant a bill of sale of the business and putting the licenses in defendant’s name so that he, Widder, could -do business under the defendant’s name; the superintendent explained to Widder that if the other breweries were to find out that the plaintiff was doing business with Widder under his own •name they could prevent his so doing and compel the plaintiff to pay the amount which Widder owted to them. Widder agreed to -do as requested, and thereupon the papers were prepared, a license was taken out in the defendant’s name and a check for $1,100 was ■drawn to and delivered to the defendant to buy the saloon. This ■check was paid over to the then owner of the saloon from whom Widder had agreed to purchase the business. The note above mentioned was executed by the defendant. He also executed a chattel mortgage which, he says, was executed in the presence of Mr. Sul* livan, a clerk of the plaintiff’s attorney, and he testifies that Mi\ Sullivan told Mr. Widder at the time that it was only a matter of ■form — that he was the man who was to keep the place. It is claimed that, under these circumstances, Widder is the real ■debtor, and that it was the understanding between the parties that -the defendant should not be responsible upon the note and chattel mortgage which he gave to secure the $1,100, endeavoring to bring "himself within the cases of Higgins v. Ridgway (153 N. Y. 130); Garfield National Bank v. Colwell (51 Hun, 169), and other cases •of similar import. Upon an examination of the evidence in this case it will be seen that there was no promise or statement made to the defendant by the plaintiff, or its superintendent, in reference to his responsibility under this arrangement. The only statement that was made in that regard was that alleged to have been made by Sullivan, the .attorney’s clerk, to Widder. It is perfectly clear that even if the .representation to Widder would inure to the defendant’s benefit, which is extremely doubtful, there is no evidence whatever that .Sullivan had any right to barter away the claims of the plaintiff. Indeed it is clear that he had not. He was merely a clerk to take the acknowledgment upon the execution of the chattel mortgage, and when that was done his function was ended as far as this ■defendant was concerned. Whatever the relations between Widder and the defendant may ¡have been, there is certainly nothing in this record to release thó defendant from the obligation which he entered into. In order that a, party may be relieved from his express contract to pay money which he has received, the evidence should be positive and direct, The defendant was anxious to make his commission upon the transaction. The plaintiff could not receive Widder as a customer, and the defendant was informed by it that if the business could be done in his name, and he take the lease and give the mortgage and sign the note, it would deliver goods to Widder. To this proposition the defendant assented, and there was nothing whatever in the negotiations between these parties which in any way limited the liability which such a transaction naturally entailed. It seems to us, -therefore, that the judgment and order appealed' from should be affirmed, with costs. Patterson, O’Brien, Ingraham and McLaughlin, JJ.8 concurred. Judgment and order affirmed, with costs.