(dissenting). The contracts pleaded in the two counterclaims involving bribery of the purchasing agent have both been executed in part. The agreement alleged even if not fully performed was criminal under section 580 of the .Penal Law which provides that if two or more persons conspire to commit a crime each is guilty of a misdemeanor.
It is urged that the rule to be applied to this case is distinguishable from the usual rule that the courts will not enforce illegal contracts because defendant is demanding restitution from his agent of moneys which were not expended pursuant to the bargain to pay Piccard, the purchasing agent. This seems to be contrary to the ruling of the Court of Appeals in Leonard v. Poole (114 N. Y. 371) in which it was held that it is immaterial that the party complained of as guilty was acting as agent for others. There, too, the scheme entered into by the parties was a misdemeanor. The Court of Appeals said: ‘ ‘ The learned counsel for the appellant insists that Kent & Co. were not principals, but were mere agents for the principals, and that they cannot avoid payment upon the ground that the transactions were illegal. When persons bnowitigly promote and participate in carrying out a criminal scheme they are all principals, and the fact that one of the parties acts, in some respects, in subordination to the others, and is to .profit less than the others, or not at all, by the consummation of the scheme, does not render such person less a principal.” (P. 378.)
Thé court added: “ The relief sought would require the court to investigate all of the várious transactions of these parties, from the beginning to the end of their unlawful enterprise, and adjust the differences between them. This is precisely what courts have always refused to do. The fraud which the trial court found, was practiced by these defendants upon their associates cannot be too' strongly condemned, but courts are not organized to enforce the saying that there is honor among lawbreakers, and the desire to punish must not lead to a decision establishing the doctrine that law-breakers are entitled to the aid of courts to adjust differences arising out of, and requiring an investigation of, their illegal transactions.” (Pp. 379-380;)
*605If it be urged that the counterclaims do not show the contract illegal in that they do not allege that paying commissions to the buyer’s agent was without the buyer’s knowledge, the answer is that with regard to purchasing agents the arrangement alleged in the pleadings is illegal under the third and fourth alternative clauses of subdivision 1 of section 439 of the Penal Law, even if made with knowledge of the principal.
That section, entitled “ Corrupt influencing of agents, employees or servants ”, in the first clause of subdivision 1 forbids giving a gratuity to an employee of another under certain conditions without the knowledge and consent of the principal. The same subdivision then proceeds in the alternative under clauses third and fourth to forbid without qualification a purchasing agent from receiving from the- seller a commission or the seller from giving or offering a commission to a purchasing agent. In the alternative provisions in such clauses, the qualifying phrases repeated in each of the preceding clauses referring to the principal’s knowledge, are completely omitted. So far as relevant that part of the statute in point reads: “ * * * or an agent * * * who, being authorized to procure * * * merchandise either by purchase or contract for * * * the credit of the principal * * * receives * * * for himself or for another, a commission * * * from the person who makes such sale or contract * * *; and any person who gives or offers such an agent * * * such commission * * * is guilty of a misdemeanor * *
Accordingly, under the statute as applicable to the facts alleged in the counterclaims, the giving or offering to give a commission to Piccard,, a purchasing agent, would be illegal irrespective of the knowledge or consent of the principal (People v. Davis, 160 N. Y. S. 769 [Court of Special Sessions, New York County, 1915, opinion by Russell, C. J.]). As pointed out in the opinion in that case, there is a distinction based on the custom of giving gratuities or tips to employees with the knowledge of the employer on the one hand, and the bribery of a purchasing agent on the other, as business experience demonstrates the necessity, in the latter case, of assuring complete fidelity to one master.
It is significant, though not determinative of this motion addressed solely to the counterclaims, that defendant in its amended answer alleges as a separate defense that the agreement set forth in the complaint and the activities alleged are “ in violation of the laws of New York and in violation of the public policy of New York ”.
*606The first and second counterclaims are based on illegal transactions and are not enforcible whether executed or executory (Sirkin v. Fourteenth Street Store, 124 App. Div. 384 [1st Dept. 1908]; Leonard v. Poole, 114 N. Y. 371, supra).
Accordingly, I dissent in part and vote to reverse the order of December 19, 1947, denying plaintiffs’ motion to dismiss the counterclaims contained in the amended answer and to grant the motion; I agree that the appeal from the order of October 9, 1947, should be dismissed as the amended answer makes the appeal from that order academic.
Peck, P. J., and Cohn, J., concur with Van Voorhis, J.; Does, J., dissents in opinion, in which Glennon, J., concurs, on appeal from the order entered December 19, 1947.
Order entered December 19, 1947, denying plaintiffs’ motion to strike out the counterclaims contained in the amended answer, as insufficient in law, affirmed, with $20 costs and disbursements. (Glennon and Dore, JJ., dissent.) Appeal from so much of order entered October 9, 1947 as denies plaintiffs’ motion- to strike out the counterclaim in the answer unanimously dismissed. Settle order on notice. [See 274 App. Div. 783.]