Pickrell v. Mendel , 84 N.Y.S. 70 ( 1903 )

Patterson, J.:

The plaintiff appeals from an order permitting the defendant Charles A. Mendel to serve a supplemental answer to the complaint. The affidavit upon which the motion for leave to serve the pleading was founded was made by the attorney for the defendant, but all the facts stated in that affidavit as grounds for the application were within the personal knowledge of the affiant. The plaintiff sued to recover from Mendel certain moneys belonging to the America’s Historic Families Publishing Company, which it was alleged Mendel had misappropriated; the complaint also alleged that Mendel was a large stockholder in the corporation, and by means of the stock which he owned and certain other stock which he influenced, was in control of it, and that the corporation had refused and neglected, after demand made by the plaintiff, to bring a suit to recover the amount so misappropriated. The defendant Mendel in his answer admitted that he applied certain money belonging to the corporation to his own use and alleges that he took such money as compem sation for services, but denies that the taking was wrongful or constituted a conversion or embezzlement of the same. The case was at issue, was on the day calendar for trial and was set down for trial for a particular day. Thereafter, a meeting of the stockholders of the company was held and at such meeting a resolution was passed by which it was recognized that Mendel was a creditor of the corporation in a much larger amount than that for which he was. sued in this action, and the stockholders accepted a proposition that the money which Mendel had erroneously paid to himself out of the funds of the company should be credited on an indebtedness of the company to him, and he claims that thus an accord and satisfaction of the claim set up in the plaintiff’s complaint was operated.

The motion for leave to file a supplemental answer setting up this accord and satisfaction was granted on the payment of fifteen dollars costs, an amount utterly inadequate to indemnify the plaintiff for the expenses to which he was necessarily put in bringing and maintaining this action and preparing it for trial. This new matter having arisen after .the case was upon the calendar and ready for trial, if the defendant Mendel is to be allowed to avail himself of it as a defense to the action at this late stage, the plaintiff should receive all the indemnity that can be allowed. Therefore, the order will be modified by requiring the defendant Mendel, as a condition for leave to serve a supplemental answer, to pay within twenty days from the service of a copy of the order to be entered on this appeal, the costs and disbursements of the action accrued up to the time the motion was made, and the order should also provide that the plaintiff have leave to discontinue the action, if he so desires, without costs.

As thus modified, the order will be affirmed, without costs to either party of this appeal.

Van Brunt, P. J., O’Brien, Hatch and Laughlin, JJ., concurred.

Order modified as stated in opinion, and as modified affirmed, without costs to either party of this appeal.