Thornton v. St. Paul & Chicago Railway Co.

Larremore, J.

Prior to June 9, 1868, the plaintiffs had agreed with the St. Paul and Pacific Railroad Company to *425furnish certain sums of money to aid in the construction of a branch road belonging to said company. On the day last named the defendant, the St. Paul and Chicago Railway Company (the successor of the St. Paul and Pacific Railroad Company) entered into a written agreement with John G. L. Childs in behalf of the plaintiffs who were partners, reciting the former agreement, that there was due plaintiffs the sum of £14,870, 6s. 3d., or $105,000 in currency, with interest-; and in consideration of the discharge of all liability therefrom, the said St. Paul and Chicago Railway Company thereby agreed to deliver to said Childs the first mortgage sever per cent land grant sinking fund bonds, to the amount of $140,000, par value, reserving the right to redeem the same upon payment of seventy-five cents to the dollar. Such bonds were to be delivered as collateral to the payment of certain acceptances to be given by said St. Paul and Chicago Railroad Company for a certain quantity of iron rails which plaintiffs were to purchase for said company.

It was further agreed that, in case of failure on part of plaintiffs to furnish and deliver said iron rails as provided, no title to said bonds was to pass, but the same were to be returned, and the claim of plaintiffs was to remain at £14,870, 6s. 3d., with interest, as an ordinary claim for moneys furnished against the said St. Paul and Chicago Railway Company.

It is then averred that an account was stated between said company and the plaintiffs, in and by which" the sum of $105,000 was found due the latter.

This is followed by an allegation that plaintiffs offered to perform the said contract, but that said company waived the performance thereof in writing, and agreed that there was due to the plaintiffs upon said contract 3,000 shares of $100 each of the capital stock; that the plaintiffs could have delivered all of said iron for the amount stated in the contract, leaving said stock as profit, and that plaintiffs have sustained damage thereby; that there is now due plaintiffs *426from, said company what would be an equivalent to the 3,000 shares of capital stock of $100 each, under the contracts set forth in said complaint.

Then follow separate averments as to the transfer of the property and assets of said company to the defendant Bice in trust, and agreement by him to deliver to plaintiffs said 3,000 shares of stock, and pay said sum of $105,000 and interest, the transfer of Bice to the Minnesota Railway Construction Company, with like agreement and trust on the part of said last named company to pay plaintiffs and deliver said stock, the transfer by said latter company to the defendant, the Milwaukie and St. Paul Bailway" Company, of the trust estate and property, with full knowledge of the previous transaction and the trust thereby imposed, who, in consideration thereof, assumed and agreed to pay and discharge plaintiffs’ claim, that such transfer of said property was in fraud of plaintiffs’ rights. These several averments, as laid, raise the presumption of liability on the part of the defendants of a trust impressed upon the property as against defendants, the Minnesota Bailway Construction Company and the Milwaukie and St. Paul Bailway Company, so as to require an appropriation of said trust property for the payment of the said sum of $105,000, and the delivery of the 3,000 shares of said stock or their equivalent.

It is true that part of the relief sought is that said transfers and each of them be declared fraudulent and void, and that they be set aside; but demurrer will not lie to the prayer of the complaint (Hall agt. Hall, 38 How., 97; Moses agt. Walker, 2 Hilton, 536; Myer agt. Van Collum, 28 Barb., 230; Andrews agt. Shaffer, 12 How., 443).

The cause of action is based upon the contracts set forth in the complaint and the subsequent acts of the defentants in dealing with said trust estate, and failure to satisfy the trusts relating thereto.

Upon the facts, as stated, it would appear that plaintiffs are entitled to some relief; and if defendants are aggrieved *427by any of the averments in said complaint, which are unnecessary or indefinite, the remedy is by motion and not by demurrer (Hall agt. The Omaha Nat. Bank., 49 N. Y., 626).

Russell Sage, as president of the Minnesota Railway Construction Company, under the act of 1853, was a proper party defendant in order to charge that company for interfering with the trust estate, and to secure a final adjudication of the rights of all concerned; and the plaintiff Stephenson being a resident and inhabitant of the city of Mew York, in which place one of the contracts was to have been performed, the court had jurisdiction of the action.

The order overruling the demurrer should be affirmed.