William Ranken, Appellant, v. T. O. Probey, as President of the National Carriage Dealers' Protective Association, Respondent

William Ranken, Appellant, v. T. O. Probey, as President of the National Carriage Dealers’ Protective Association, Respondent. Third Department, March 10, 1909. ' Association—unincorporated society—contract with secretary — pleading—motion to make more definite and certain. The rights of members of an unincorporated association with it and among them- • selves are governed by its constitution and by-laws. Where an association is organized for pecuniary profit the members become, in fact copartners and the liability of the individual members rests upon the rules governing the liability of partners and the liability of principals for the acts of their agents. In an action against an unincorporated association upon a contract between it and its secretary an allegation of the complaint that defendant was organized for “pecuniary profit,” not challenged hy a motion to make more definite and certain, is sufficient to authorize proof of such a purpose in the formation of defendant as would authorize contracts in excess of the fund provided hy initiation fees and dues. Where the duties of plaintiff as secretary of defendant are such that failure to perform them would subject the defendant to pecuniary loss, the necessity of the service impliedly authorizes him to pledge the credit of the members. A plaintiff may plead conclusions of fact subject to defendant’s right to move to make the allegations more specific. Appeal by the plaintiff, William Ranken, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Rensselaer on the loth day of October, 1908, upon the dismissal of the complaint by direction of the court on the plaintiff’s opening upon a trial at the Rensselaer Trial Term. The complaint in this action was dismissed at the opening of the trial upon the ground that it did not state facts sufficient to constitute a cause of action. The complaint was in form as follows: “ The plaintiff, for Ms amended complaint against the defendant respectfully alleges and shows to the court: “First. That the said Rational Carriage Dealers’ Protective Association was, at the times hereinafter mentioned, and ever since has been, an unincorporated association, consisting of more than seven members. That the object for, which said Association was organized was the protection and benefit and pecuniary profit of the retail carriage dealers throughout the United States. That the said Association has upward of six hundred (600) members. That the said Association is governed by a constitution and by-laws duly adopted by said Association, under which constitution and by-laws the members of said Association are required to pay as an initiation fee the sum of five ($5.00) dollars, and in addition thereto each member shall pay as his annual dues, the sum of two ($2.00) dollars, payable in advance. “Second. That the said T. O. Probey, at the time of the commencement of this action, was the duly elected president thereof. “ Third. That for many years prior to the 9th day of October, 1908, the plaintiff held the office of secretary of the said defendant, the National Carriage Dealers’ Protective Association, discharging the duties and'rendering the services appertaining thereto. “ Fourth. That the salary of the secretary of said Association during the past several years has been and was duly and regularly fixed by the defendant Association at fifty dollars ($50.00) per month. 11 Fifth. That the said defendant Association has failed and neglected to pay to this plaintiff his said salary at the rate of fifty ($50.00) dollars per month of the eight (8) months next preceding the 9th day of October, 1906, and the defendant Association is now justly indebted to the plaintiff in the sum of four hundred ($400.00) dollars, for such salary and services rendered by him as such secretary as aforesaid, no part of which has been paid, after demand made therefor. “Sixth. That while acting and performing the duties of such secretary plaintiff incurred certain expenses incident to the conduct of his office as such secretary, to wit, the sum of one hundred ($100.00) dollars, pursuant to and by virtue, of resolutions of said Association heretofore duly passed and approved, ■ authorizing the secretary of said Association to incur expenses incident to his office, and to purchase such supplies as might be necessary in the conduct thereof, which sum is now justly due and owing the plaintiff by the defendant. “ Seventh. That this action is brought'against the President of said Association, the National Carriage Dealers’ Protective Association, to recover the said salary of the plaintiff as Secretary of said Association, and the expenses incidental to the office of Secretary thereof and incurred by him in the conduct of his office as such Secretary,, for and upon which claim the plaintiff might have maintained such action against all of the members of the said Association, either jointly or severally. “That all of the members of.said National Carriage Dealers’ Protective Association are liable jointly and severally to pay the claim herein sued on. “ That the services rendered and the disbursements made by the ' plaintiff as Secretary of the Rational Carriage Dealers’ Protective Association as hereinbefore set forth and which make up the claim herein sued on, were necessary for the -preservation and the maintenance of the existence of the said Association. “ Wherefore, plaintiff demands judgment against the defendant for the sum of five hundred ($500.00) dollars, with interest from the 9th day of October, 1906, together with the costs of this action.” . . From the judgment entered upon the order dismissing the complaint the plaintiff has appealed to this court. H. P. Humphrey, for the appellant. Peck & Behan [John T. Norton of counsel], for the respondent. Sic. ■ [MAJORITY — Smith, P. J.:] Smith, P. J.: The questions arising in this case do not arise between the unincorporated association defendant and a third party. The contract here to be construed was made between the association and one 'of its own members. Whatever, therefore, may be the rights of third parties in dealing with such an association, it can hardly be questioned that the rights of members with the association and among themselves are to be governed by their agreement which is contained in their constitution and by-laws. This is held in Belton v. Hatch (109 N. Y. 593); O'Brien v. Grant (146 id. 173). In the latter case, in the Opinion, it was said: “ It was perfectly competent for the banks to form themselves into this voluntary association and to agree that they should be governed by a constitution and by.rules. When adopted they expressed the contract by which each member was bound, and which measured its rights, duties and liabilities.” In the complaint is stated, the contract between the association and its members, by. which its members were required to pay an initiation fee of five dollars, and in addition thereto two dollars per. year, payable in advance. We may assume that there is no further express provision, either in the Constitution or by-laws, subjecting the members of the association to any further liability. In McCabe v. Goodfellow (133 N. Y. 89) a law and order league had been organized for the purpose of using its influence to assist the town and village officers in enforcing the excise and corporate laws. There was no constitution or by-laws shown, but it seems to have been contemplated that the moneys necessary to perfect the purpose of the association should be raised by subscriptions. The officers of the association employed an attorney to prosecute for penalties. The action was brought against the association under section 1919 of the Code of Civil Procedure, for the value of the services rendered by the attorney, in these prosecutions for penalties. It was held that the association was not liable, as no individual liability was there contemplated. In the opinion, however, occurs this sentence: “In this respect there is a plain distinction between associations formed for the purpose of pecuniary profit and those formed for other objects.” This complaint alleges that this association was formed for pecuniary profit, and it is claimed that this allegation distinguishes this case from the rule of law stated in the case above cited. A further reading of the opinion in the McCabe case makes, clear what is there meant by an association- organized for a pecuniary profit; It refers to an association organized to carry on some business in which a. profit is looked for; in which case the members of the association become, in fact copartners, and the liability of the individual member rests upon rules governing the liability of partners and the liability of principals for the acts of the agent. Such was the cage of National Bank v. Van Derwerker (74 N. Y. 234). In Lightborn v. Walsh (97 App. Div. 187) an association was formed of the members of the Socialist Labor Party, who -were required to pay monthly, dues. A newspaper was started by this association, which was supported by a fund acquired from voluntary contributions, “ and it did not appear that the board of trustees in charge of the newspaper were authorized to contract debts in excess of such: fund.” R was there held that one who rendered services as a linotype operator in the printing of the newspaper, and who was a member of the association, could not . recover against the association for his services, and that “ it could not be said that it was within the contemplation of the members of the organization that they should be individually liable for debts contracted in the publication of the newspaper.” - But the question here arises as it were upon á demurrer. The averment that the corporation was organized, for pecuniary profit could well .have been more definite. Unchallenged, however, by motion to make more definite it is sufficient to authorize proof of such a purpose in its formation as would authorize contracts in excess of the fund provided by the initiation fees and dues. The duties of plaintiff may have been such that a failure to perform the same would subject the society to pecuniary loss. In such case there would be little doubt from the necessity of the service of an implied power to pledge the credit of the members therefor. The complaint is challenged as stating conclusions only, but those conclusions are conclusions of fact which may be pleaded, subject to the right of defendant to demand by motion more specific averments. The judgment should, therefore, be reversed and a new trial granted, with costs to appellant to abide event. All concurred. Judgment reversed and new trial granted, with costs to appellant to abide event.