This action was brought to recover an unpaid balance of the purchase price of forty-three shares.of the capital stock of a corporation sold and delivered by the plaintiff to the defendant. The sole question presented on this appeal is whether the plaintiff’s failure to pay the tax imposed by chapter 241 of the Laws of 1905, as amended by chapter 414 of the Laws of Í906, at the time of the transfer defeats his right to recover in this action. No such defense was pleaded, and the answer admits, by not denying, the contract of sale. The stock certificate delivered to the defendant and said contract were received in evidence without objection." Subsequently, upon its appearing on the cross-examination of the plaintiff that the stock transfer tax was not paid at the time of the transfer, a motion was made to strike out all of the evidence, and it is claimed that the exception to the denial of that motion and to the denial of the motion for a nonsuit presents the question on this appeal. The *847plaintiff’s failure to pay the tax and affix'the stamps as required by the statute was inadvertent and not due to an intention to evade the law. The learned referee permitted the stamps to be affixed at the hearing before him.
Section 315 of the Tax Law (Gen. Laws, chap. 24; Laws of 1896, chap. 908), added by the act of 1905, and amended by the-act of 1906 (supra), imposes a tax “ on all sales, or agreements to sell, or' memoranda of sales, or deliveries, or - transfers, of shares or certificates of stock, in any domestic or .foreign association, company 'Of-' corporation,” the payment of which is to be denoted ‘byaffix-iñg^aií-" adhesive stamp or stamps as follows: (a) Upon the transfer 'books-■; in case the-transfer is shown only by them; (b) upon the:-transfer" certificate where the change of ownership is thus' indicated; (e) in other cases upon the bill or memorandum of sale which the seller is required to deliver to tlie buyer. By section 323 of the Tax Law, added by the act of 1905 (supra), it is provided : “No transfer of stock made after June first, nineteen hundred and five, on which á tax is imposed by this article, and which tax is not paid at the time-of such transfer, shall be made the basis of any action or legal proceedings, nor shall proof thereof be offered or received in evidence. in any court in this. State.” It will be observed that the statute radically differs from those under which it has been held permissible to validate the transfer by subsequently affixing stamps. This statute not-only omits to provide - for doing that, but distinctly provides that the transfer shall not be made the basis of any action or legal proceedings unless the tax is paid “ at the time of such transfer.” The payment of the tax might easily be evaded if a transfer could be rendered- valid by subsequently affixing stamps, and so by language, which does not admit of- construction, the Legislature has. provided as stated. We think, therefore, that the failure to pay the tax and affix stamps at the time of the transfer is fatal to the plaintiff’s right of recovery, provided the question is before us.
The statute specifies different methods of denoting the payment of the tax. Unless such payment be a condition precedent, which the plaintiff must allege and prove, he should be warned by an appropriate answer, so that he may be prepared with his proof. In this case the defendant admitted the making of the contract, and, *848therefore, I think necessarily admitted that the contract was valid and enforcible, except for the affirmative defenses' set up, which are not before , us. The statute is purely a revenue measure. - It does not prohibit"the transfer of, or the making of contracts tó transfer, shares of stock. ; The right to do that existed before and was not taken away by' the statute. Solely for the purpose of raising revenue a tax was imposed, and to insure the payment of it, it was provided that in'default of such payment the transfer could not be made the basis of any action or legal proceedings. It was held that the statute declaring certain contracts void unless in writing did not prohibit Jthe making of oral.contracts, but merely enacted a rule of evidence prescribing a method of proof, and that, therefore, the. objection was waived unless pleaded. (Crane v. Powell, 139 N. Y. 379.) In this case the statute in terms enacted a rule of evidence. It does hot make the payment of the tax. a condition precedent to the right to make, a transfer of shares of stock; Concurrently with a transfer, the tax is to be paid or no proof thereof can be offered or received in any court in' this State.
The case is in many respects like that of the failure of a foreign corporation to pay the license fee imposed by statute for the privilege of carrying on its business in this State, The statute imposing such license fee provides: “No action shall be maintained or recovery had in any of the courts in this State by such foreign corporation without obtaining a receipt' for 'the license fee -hereby imposed within thirteen months after beginning "such business within the State” (Tax. Law [Gen. Laws, chap. 24; Laws of 1896, chap. 908], § 181, as amd. by Laws of 1901] chap. 558, § 1.; since amd. by Laws of 1906, chap. 474, § 1, and revised into Tax Law [Consol. Laws, chap. 60; Laws of 1909, chap. 62]-§ 181); but it was held that non-compliance with the statute was a matter of defense to be availed of by answer, distinguishing the casé from cases of failure' to obtain the certificate of the Secretary of State authorizing the corporation to do business, which is a condition precedent to the right to do business. (Wood & Selick v. Ball, 190 N. Y. 217.)
No" doubt the courts will refuse to aid in the enforcement of illegal and immoral contracts, irrespective of the pleadings • in the action. (Oscanyan v. Arms. Co., 13 Otto. [103 U. S.], 261.) The contract in suit was neither illegal, nor Immoral If it' appeared *849that the plaintiff had purposely evaded the payment of the tax, a different question would be presented. The defendant has the plaintiff’s stock without having paid for it. The plaintiff inadvertently omitted to pay the stamp transfer tax at the time of the transfer. In such case the court is not bound of its own motion to refuse its aid to the enforcement of the contract of sale.
The judgment should be affirmed, with costs.
Ingraham, P. J., Lahghlin, Clarke-and Scott, JJ., concurred.
Judgment affirmed, with costs.