Dwight v. Badgley

Lawrence, J.

The complaint alleges that the defendant is indebted to the plaintiffs in the sum of $1,997.50 upon an account for certain goods purchased, services rendered, and moneys advanced between certain specified dates; that payment of said sum has been duly demanded, but that no part thereof has been paid. A bill of particulars showing the account between the parties follows the complaint in the printed case, by which it appears that the amount claimed by the plaintiffs is due to them. The defendant, in his answer, denies, among other things, any indebtedness to the plaintiffs, and avers as an affirmative defense that the plaintiffs at the times mentioned in the complaint were not dealers in the merchandise mentioned therein, nor had they possession or control thereof. Also “that at the times mentioned in said complaint, any and all transactions mentioned in said complaint, between these plaintiffs and this defendant, were had with the intent of the parties hereto not to make any actual sale or delivery thereof, but at maturity of the said contracts or transactions that the difference between the market value and the contract price should be paid by one party to the other. That the market price of such merchandise at the maturity of the contracts was at the times of making the contracts contingent and uncertain; and that the contracts were mere wagers on the future market price thereof, and contrary to the statute.” The learned justice before whom this cause was tried at the conclusion of the evidence of both parties directed a verdict in favor of the plain tiffs for thesumof $2,357.05 which verdict the defendant’s counsel moved to set aside as contrary to law. He also moved for a new trial upon the minutes, and upon the exceptions taken, and upon all the grounds stated in section 999 of the Code of Civil Procedure. This motion being denied, the defendant’s counsel excepted.

We will consider the exceptions taken by the defendant’s counsel in the order in which they appear in the case. On the cross-examination of Mr. Hodge, the broker of Dwight & Gillette, through whom the sales and purchases for the defendant were effected, the witness was asked this question: “Was that wheat ever delivered to Mr. Badgley?” It appeared by his previous testimony that prior to the transactions involved in this action the witness had other transactions with Mr. Badgley, the defendant, on account of the firm of Dwight & Gillette, the plaintiffs. We think the ruling of the learned justice was correct. In this case it is sought to stamp a transaction as illegal as being in contravention of the provisions of the Revised Statutes against wagers or gaming. The statute is penal in its nature, and the burden of proof is upon the defendant to establish the illegality of the-contract. Story v. Salomon, 71 N. Y. 420. Even 'if the parties had been guilty of entering into illegal contracts prior to the transactions upon which this action is based, as the plaintiff is entitled to the strictest proof in this case, we think that proof of former transactions alleged to be illegal, not embraced within the times specified in the bill of particulars, was not competent. The next exception was to the exclusion of the question as follows: “Question. At the time of making these contracts for the purchase of this wheat and corn, was it not your intention and the intention of Mr. Badgley to adjust the differences between the market price in buying and the market price in selling?” The exception was not well taken. The question was too broad. It called not only for the intention of the witness, which might have been admissible, but also for the intention of the defendant. As to the defendant’s intention the witness was clearly incompetent to speak. . The exception to the ruling as to what was the general custom as to the delivery of the wheat or corn cannot be sustained for the reason that no such custom is pleaded, and because no evidence had been given tending to show that the parties had any knowledge of such custom, nor that any general custom existed in relation to such transactions as are involved in this controversy. The establishment of the existence of a general custom by evidence should have preceded the question which was put to the witness, and before such custom was established the witness could not properly be called upon to give a.statement as to what the custom was. Harris v. Tumbridge, 83 N. Y. 93. The observations just made, apply with equal force to the exception upon disallowing the questions to the defendant, Badgley, as to his transactions with the plaintiffs prior to December 30, 1886.

The question put to the defendant as to his intention and understanding that none of the grain should be delivered to him, but that the difference in the market price should be adjusted between the parties, should, we think, have been allowed. While the answer to it would not have conclusively shown what the intention of the plaintiffs was in entering upon the course of dealings with the defendants referred to by the witness, it in valved an answer which the defendant was entitled to have, presented to the jury, and which might have aided them in determining what was the real intention of the parties. Peck v. Wright Co., 10 N. Y. Supp. 401; Kenyon v. Luther, 4 N. Y. Supp. 498, and cases cited. The case of Kenyon v. Luther, supra, decided by the general term of the fourth department, is directly in point. That was an action brought to recover for commissions earned and losses sustained by plaintiffs under a contract with the defendant for the sale of a large' amount of wheat. The defense set up was that such contract was intended as a cover for a gambling transaction, and that it was illegal and void under the statute. Upon the trial, the defendants were asked directly whether they intended at the time to purchase or hold any wheat, or to sell any wheat: or whether it was their intention to tender or call for the grain, or to settle the difference between the price at which it was sold and the market price at the future day. The questions calling for the intention of the defendants were objected to by the plaintiffs’ counsel and the objections were sustained. Upon appeal it was held that the exclusion of the questions was error, that the defendants were entitled to show what their intention was, and that such evidence should have been submitted to the jury. Upon a subsequent appeal, after a verdict had been rendered in favor of the defendants, the court ailirmed the judgment. .See 10 21. Y. Supp. 951. For the error of the learned justice in excluding this question, we are of the opinion that the judgment should be reversed, and a new trial ordered, with costs to appellant to abide event.