St. James Co. v. Security Trust & Life Ins.

O’BRIEN, J.

The plaintiff company, having shown that the defendant, through its vice president, had received at his instance from the plaintiff moneys from its treasury which were actually used for the payment of the taxes due on defendant’s building, had sustained the burden resting upon it, and the referee was justified in his conclusion in its favor. The contention is made, however, that the judgment' should be reversed for errors committed to the prejudice of the defendant in rulings upon evidence.

The defendant sought to prove that Mr. Price and Mr. Stout, the latter being principal owner of the plaintiff company, and both being large stockholders in the defendant company, were desirous of preventing the foreclosure of the mortgage held by the Mutual Life Insurance Company upon the St. James Hotel property, which was the largest and principal asset of the defendant company, and that on their own account, and for their own benefit, and gratuitously, and without any reference to whether they were or were not to receive back repayment, they undertook to discharge the obligation which rested upon the defendant company of paying the taxes which were due on the St. James Hotel property. To that end it was sought to examine into the transactions between Mr. Stout and Mr. Price as to the accounts between them, and as to what they said and did in and about the time that the $42,000 was borrowed from Mrs. Price by Mr. Stout, and by him placed in the treasury of the plaintiff company.

With respect to all this class of evidence it seems to us that it was entirely incompetent, immaterial, and irrelevant, because this ac*741tian was not for an accounting between Mr. Stout and Mr. Price, but was an action at law between the plaintiff corporation and the defendant corporation to recover moneys lent. If an accounting between Mr. Stout and Mr. Price could have any material bearing on the issues presented, it was herein made to appear by uncontradicted evidence that all their differences with respect to stock and borrowed money were adjusted and settled prior to the trial before the referee, and upon that basis Mr. Stout was released from any and all claims which Mr. Price might have had against him growing out of their relations as officers, stockholders, or persons otherwise interested in either of the two corporations. In any aspect, therefore, whether the taxes were, as the result of an agreement, paid out of the moneys which belonged to Mr. Price and Mr. Stout jointly before they were placed in the plaintiff’s treasury had no relevancy to the issue as to whether or not the plaintiff loaned to the defendant. It could make no difference nor was it any -concern of the defendant, whose moneys were deposited in the bank account of the plaintiff. It was conceded that the payment of the taxes was an obligation which rested on the defendant. It was also shown that it was the plaintiff’s check which paid the taxes, and so far as it was necessary to show that the money had actually gone into the plaintiff’s treasury, and from what source it was received, this clearly appeared from the cross-examination of Stout.

The most that could be claimed of such evidence is that it might have had a tendency to prove as matter of defense that the plaintiff was not the real party in interest. If it had been proved, however, that originally the money borrowed from Mrs. Price had been so borrowed by both Mr. Price and Mr. Stout, it was conclusively shown that it went into the plaintiff’s treasury, which thus got the legal title to the money, and that thereafter the taxes were paid with the plaintiff’s check. When it is recalled that there is no suggestion that the money was stolen by Mr. Stout or came wrongfully into his possession, nor is Mr. Stout or Mr. Price or anybody here asserting any claim to the money as against the plaintiff, and the further fact, proved without dispute, that the transaction was one between the plaintiff and the defendant by which moneys to which concededly the plaintiff had legal title were borrowed to pay the debt of the defendant, it becomes evident that the defense sought to be proved would not, if established, be available, because payment of the judgment to the plaintiff will fully protect the defendant against claims by third parties. This, under the authorities, is the test as to whether or not the plaintiff is the real party in interest. Sheridan v. Mayor, 68 N. Y. 30; City Bank New Haven v. Perkins, 29 N. Y. 554, 86 Am. Dec. 332; Gage v. Kendall, 15 Wend. 640.

It was further contended that it was erroneous to exclude evidence upon the question of whether or not Mr. Stout as vice president of the defendant had power or authority to borrow the money. If the claim had been made that he had special authority, and that was a crucial point in the case, such evidence would be relevant. Mr. Stout, however, did not claim express authority, but insisted that as an officer of the company, and pursuant to the resolution which gave *742him charge and management of the St. James property, he had implied authority to do all things necessary, including the borrowing of money to pay taxes, so as to avoid foreclosure anj save and protect the property for the benefit of the defendant. Whether he had such power did not depend upon any specific authority to negotiate the loan, but turned upon whether, by virtue of his position as vice president of the company and manager of this particular property under the resolution which gave him general powers in connection therewith, he was authorized and justified, for the benefit of the defendant, in making the payment so as to bind it. The exclusion of the evidence, therefore, bearing upon the question of specific authority, we think was proper.

The other points of the appellant we have examined, but find no reason therein presented calling for a reversal. Our conclusion, therefore, is that the judgment should be affirmed, with costs.

VAN BRUNT, P. J., and McLAUGHLIN, J., concur.