SHERMAN v. BOEHM

SHERMAN v. BOEHM. N. Y. Common Pleas, General Term, January, 1885. Action for breach of contract of agency.—Pleading ; striking out as sham ; Code Civ. Pro. §§ 500, 538.—Appeal from order. The denial of a part of the allegations in a complaint, which is coupled with other allegations in the same answer, addressed to the same cause of action, may be stricken out as sham if it be shown "by affidavits that the transactions which the defendants deny on information and belief were personal transactions between them and the plaintiffs. The rule in Wayland ®. Tysen, 45 N. Y. 281, that a general or specific deniál cannot be stricken out as sham if verified, applies to denials of knowledge or information sufficient to form a belief; but a denial on information and belief may be stricken out as sham, where it appears by uncontradicted proof that the defendant must have personal knowledge of the subject. It is in effect an allegation that the only knowledge defendant possesses is derived from information and belief, and that he has formed a belief from such information that the averments of the complaint are false; and if the allegation is untrue because the transactions were personal with him, the defense may be stricken out as sham. An order refusing to strike out an answer as sham is appealable to the general term. Appeal from an order of the special term denying a motion to strike out a defense as sham. Arthur G. Sherman and Frederick G. Brower sued Samuel C. Boehm and Gustave S. Boehm, alleging that the plaintiffs, as partners, contracted with the defendants, as partners, to become defendants’ agents for the sale of certain goods upon the defendants’ assurance, continuously and permanently to supply the plaintiffs therewith and enable them to compete with other dealers ; and that after plaintiffs had entered upon the service and expended money and labor in fulfilling their duties, defendants sold out their business to other dealers, and discontinued their employment. The second cause of action stated in the complaint, alleged that in pursuance of said contract, plaintiffs furnished the defendants orders, which were accepted by defendants, and on such orders they were entitled to specified sums as commissions ; and for a third cause of action, it was alleged that plaintiffs rendered services in cataloguing merchandise, and in corresponding with defendants’ customers, &c., for which they were entitled to a specified amount. The answer of the defendants admitted the allegations of the complaint in reference to the partnership of the parties respectively, and also the writing which embodied the alleged contract, and then contained this clause: “And further answering on their information and belief, they deny each and every allegation and complaint constituting the plaintiffs’ first cause of action.” Then followed an allegation that defendants did agree to employ the plaintiffs as set forth in the writing or letter pleaded in the complaint, but with the distinct understanding that they could at any time dispense with their services. Further, that plaintiffs, of their own volition terminated the agreement. The defenses to the second and third causes of action are not material to this motion. The plaintiffs now moved to strike out the denial on information and belief, before quoted, asking in their notice also, that if such relief were denied, the answers should be made more definite and certain as to what allegations the defendants so denied. The motion was supported by affidavits of each of the plaintiffs that the transactions pleaded in the first cause of action were had by and between the deponent and his partner, and the defendant, Samuel C. Boehm, who verified the answer, and the defendant Grustave S. Boehm, his partner, and were in every sense within the actual and personal knowledge of both defendants, and especially of Samuel C. Boehm, who verified the answer herein, denying, on information and belief. These parts of the answer were stated in four paragraphs not numbered, the first one being introduced with the words “ The defendants in answering the first cause of action set forth in the complaint, &c.” The next part of the answer was introduced with the words “ And in answering the second cause of action, &c. and the first of the two remaining paragraphs of the. answer were introduced with the words, “ And defendants in answering the third cause of action, &c.” The court at special term held that the case of Metraz v. Pearsall (5 Abb. N. C. 90), was nob in point as an authority for denying the motion, on the ground that the contract may have been made by an agent, because the affidavits showed that it was not so made ; but that regarding the motion as a motion to strike out part of the defense to the first cause of action, it must be denied on the authority of Slack v. Cotton, 2 E. D. Smith, 398 and Collins v. Coggill, 7 Robt. 81, although the court deemed the denials false. Plaintiffs appealed. Winthrop Parker, for the plaintiffs, appellants. I. The court should not send the plaintiffs to trial on issues honestly framed as to the plaintiffs’ case, and (concededly by the court) falsely and disingenuously framed as to the defendants’ case. Such a procedure would certainly deprive plaintiffs of a most substantial right, and -the order would be appealable on that ground, if it were not also appealable because it denies the stated grounds of motion. (Jeffras v. McKillop, 2 Hun, 351; Arrieta v. Morrissey, 1 Abb. Pr. N. S. 439 ; Livermore v. Bainbridge, 47 How. Pr. 354 ; Sherwood v. Verplanck, 9 Weekly Dig. 553). II. The court has inherent control of proceedings before it, and is not limited by the provisions of the Code in its power to deal with a pleading which is to its knowledge false aind trifling. Plaintiffs’ request for such other and further relief as might be just, placed them properly before the court on this motion from this and all points of view (M’f’rs’ Bk. v. Hitchcock, 14 How. Pr. 406). III. The special term erred in holding this to be part of a defense, for though the matter sought to be stricken out is not set forth by description “for a first and separate defense,” it is none the less so for that reason, and plaintiffs should not be prejudiced by defendants’ omission to separately state and number their defenses, as required by the Code (Benedict v. Seymour, 6 How. Pr. 298). The admissions which precede this first defense are simple admissions without matter in avoidance, and are so surplusage and not part of any defense. The admissions which succeed it are in defenses which confess and avoid, and are so entirely distinct from the defense of denial (Slack v. Cotton, 2 E. D. Smith, 398 ; Collins v. Coggill, 7 Robt. 81; Pratt Mfg. Co. v. Jordan Iron, &c. Co., 33 Hun, 143). IV. The defense is indefinite and uncertain, for the reason that a denial of the allegations constituting the first cause of action involves a conclusion of law as to what allegations are necessary to or constitute that cause of action, and plaintiffs should not be left in any doubt, as they are here, as to what they must prove or what is admitted (Mattison v. Smith, 19 Abb. Pr. 288; Seward v. Miller, 6 How. Pr. 312). V. The allegations of the duly verified complaint which are attempted to be put in issue by the defendants’ said defense, are shown clearly by the affidavits of both plaintiffs, read on the motion, and by inspec-. tion of the allegations themselves, as set' forth in the complaint, to be within the personal knowledge of the defendants. The general term of the supreme court, first department, has lately held that denials upon information and belief are unauthorized by Code, § 500, create no issue and should be stricken out, and this case is exactly in point as having the denials, accompanied with previous simple admissions (Pratt Mfg. Co. v. Jordan Iron, &c. Co., 33 Hun, 143). VI. Denials on information and belief of allegations in the complaint, are not sufficient when the truth or falsity is within defendant’s own knowledge, and such a defense will be stricken out as sham, false and evasive (Swinburne v. Stockwell, 58 How. Pr. 312 ; Ketcham v. Zerega, 1 E. D. Smith, 553 ; Hance v. Rumming, 2 E. D. Smith, 48 ; Edwards v. Lent, 8 How. Pr. 28 ; Byrne v. Benton, 3 Monthly L. Bul. 100. VII. Upon a motion made upon affidavits to strike out an answer or defense containing denials, where it is.satisfactorily proved that the denials are false, the court may strike out the defense as false (Elizabeth-port Mfg. v. Campbell, 13 Abb. Pr. 86 ; People v. McCumber, 18 N. Y. 315 ; Willet v. Metropolitan Ins. Co., 2 Bosw. 678. VIII. The case of Wayland v. Tysen (45 N. Y. 281), is easily distinguishable from the case at bar, for there we find a positive and verified denial on knowledge, the court distinctly placing refusal to strike out, on the grounds that the defense was the old general issue, and that prosecution for perjury would be the proper remedy for falsity, and saying, in effect, that defendant, standing upon Ms oath, the case could not be tried on motion and affidavits. Here the falsity shown is, that defendants personally made the contract, &c., and knew all about it, but sought shelter from perjury behind denial on information and belief, while the unanswered affidavits additionally prove that the denial itself is false. Such defense is not good as a general denial (Pratt Mfg. Co. v. Jordan Iron, &c. Co., 33 Hun, 143). Jeroloman & Arrowsmith, for the defendants, respondents. I. An appeal does not lie from an order refusing to strike out an answer as sham or frivolous (Fillette v. Hermann, 8 Abb. Pr. N. S. 193 n ; Crucible v. Steel Works, 9 Abb. Pr. N. S. 198 n.). Nor from an order refusing to make a pleading more definite and certain (Field v. Stewart, 8 Abb. Pr. N. S. 193 ; Murphy v. Dickinson, 40 How. Pr. 66). II. It is well settled that a court has no power to strike out as sham an answer consisting of a general denial (Wayland v. Tysen, 45 N. Y. 281 ; Newman v. Supervisors of Livingston, 45 N. Y. 676). This motion cannot be granted unless the entire answer or defense is sham (Winslow v. Ferguson, 1 Lans. 436). III. A defendant may deny the allegations in the complaint on knowledge or upon information and belief {Code Gin. Pro. § 524 ; Stent v. Continental National Bank, 5 Abb. N. C. 88; Metraz v. Pearsall, 5 Abb. N. C. 90). [MAJORITY — J. F. Daly, J.] J. F. Daly, J. The matter complained of is not part of a defense. Each denial of separate allegations of the complaint is a separate defense, and may be stricken out (Slack v. Cotton, 2 E. D. Smith, 398). It appears from the affidavits on which this motion is made, that the denial in the answer is false, because certain of the transactions alleged in the complaint and covered by the denial were personal transactions between plaintiffs and defendants. No affidavits wer,e interposed by the defendants denying this statement. It appears, therefore, that a denial of those .personal transactions “ on information” is a sham and false- denial, and should be stricken out. - It is- no objection to granting this motion, that'a general or specific denial cannot be stricken out as sham. The decision in Wayland v. Tysen (45 N. Y. 281) applies to those denials made in the form authorized by section 500 of the Code, viz., absolute denials or denials of information sufficient to constitute a basis of belief. It has been held that a denial “ on information and belief ” maybe made where the defendant has no positive knowledge, and is prepared to assert, upon such information as he possesses, that the allegations of the complaint are false (Brotherton v. Downey; 21 Hun, 436). Such denials cannot be regarded as frivolous (Metraz v. Pearsall, 5 Abb. N. C. 90). Nor as •irrelevant or redundant (Brotherton v. Downey, above). But it has hot been held that such a-denial is not subject to a motion to strike it out as sham where it appears by uncontradicted proof that - the defendant must have personal knowledge of the allegations he denies “on information.” It is in effect an allegation •in the answer that the only knowledge which defendant possesses is derived from information, and that he has formed a belief from such information that the 'averments of the complaint are false. If that allegation is untrue because the averments of the complaint .-are of personal transactions, the remedial provision of ‘section 538, -.permitting sham defenses to be stricken .-out on motion, should be applied, and the decision in Wayland v: Tysen (above) should not be extended to cover the case. The allegations in this complaint •.which defendants have denied “on information and •.belief” include personal transactions between the parties, as well as matters which are not necessarily within defendants’ knowledge. The motion should be granted, striking out the de- „ fense complained of as sham, but with leave to defendants to serve an amended answer on payment of $10 costs of motion, $10 costs of this appeal, and disbursements. Allen, J., concurred; Larremore, J., dissented. Order reversed.