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App. Div.]

FOURTH DEPARTMENT, NOVEMBER TERM, 1901.

The exceptions of the defendants should be overruled and motion denied, and judgment ordered for the plaintiff on the verdict, with costs and disbursements.

All concurred, except RUMSEY, J., not sitting.

Defendants' exceptions overruled, motion denied and judgment ordered for the plaintiff on the verdict, with costs.

MARY OSBORNE, Appellant, v. SARAH E. PARKER, as Administratrix, etc., of FRANKLIN J. PARKER, Deceased, Respondent.

Reference of a claim against a decedent's estate - when the existence of a counterclaim thereto does not give a justice of the peace jurisdiction thereof — costs including disbursements, awarded by the referee where the recovery because of the counterclaim is less than $50 — power of the Special Term over the costs and disbursements.

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A claim of $114 and interest against a decedent's estate for the use of a right of way having been rejected by the administratrix, a reference of the claim was ordered pursuant to the statute. The referee allowed the claim of the plaintiff in full, but credited the defendant with the amount of a note, which she held against the plaintiff and a third party, on which there was concededly due the sum of $113.86. He, therefore, rendered judgment in favor of the plaintiff for the balance of her claim "besides the referee's and stenographer's fees and the disbursements of the action." The counterclaim grew out of a transaction entirely independent of the claim presented.

On a motion for retaxation the Special Term granted costs to the defendant and disallowed the disbursements allowed by the referee to the plaintiff.

Held, that the original taxation should be confirmed;

That section 2863 of the Code of Civil Procedure, as amended by chapter 527 of the Laws of 1895, which gives a justice of the peace jurisdiction of a demand against an executor or administrator "where the amount of the claim is less than the sum of fifty dollars, and the claim has been duly presented to the executor or administrator and rejected by him," did not render it incumbent upon the plaintiff to bring the action in the Justice's Court, as it was entirely optional with the defendant whether or not to offer the note as a counterclaim; That the provision of section 2718 of the Code of Civil Procedure, requiring the claim to be supported by an affidavit "that no payments have been made thereon and that there are no offsets against the same to the knowledge of the claimant," does not establish that the amount of the claim is the sum remaining unpaid after deducting existing offsets or counterclaims;

That section 317 of the Code of Procedure, providing that on a reference pursuant to the statute, "the prevailing party shall be entitled to recover the fees of

FOURTH DEPARTMENT, NOVEMBER TERM, 1901.

[Vol. 66.

referees and witnesses and other necessary disbursements to be taxed according to law," has not been repealed and is still in force.

Quare, as to the power of the Special Term on a motion for retaxation of costs to strike out the allowance of disbursements to the plaintiff and award costs to the defendant.

APPEAL by the plaintiff, Mary Osborne, from an order of the Supreme Court, made at the Genesee Special Term and entered in the office of the clerk of the county of Genesee on the 5th day of March, 1901, granting costs in the above entitled action in favor of the defendant and against the plaintiff and directing the clerk of Genesee county to retax the disbursements allowed by him to the plaintiff by disallowing the same, and that the judgment theretofore entered in the action be corrected accordingly.

The plaintiff presented a claim of $114, besides interest, for use of a right of way to the defendant, who was the administratrix of the goods, etc., of her deceased husband. The claim was rejected, and upon the written agreement of the parties an order of reference was entered with the approval of the surrogate and a trial had before a referee. The referee allowed the claim of the plaintiff in full, but he reduced it by reason of the promissory note held by the defendant against the plaintiff and one Nehemiah Osborne and on which there was concededly unpaid at the time of the trial $113.06, leaving due the plaintiff $9.18, for which the referee awarded judgment "besides the referee's and stenographer's fees and the disbursements of the action," which were subsequently taxed by the clerk at $152.01 and included in the judgment. The plaintiff upon presenting her claim accompanied it by her affidavit verifying that it was justly due; that "no part of the same has been paid and that there are no counterclaims thereto to the knowledge of deponent." At the time of the presentation of the claim the note was a due subsisting demand against the plaintiff and said Osborne, and was in the custody of the defendant's attorney, H. B. Cone, who was acting in her behalf in this action. The referee finds that at the time of the presentation of the claim "the said Cone, agent and attorney for the defendant, was asked by the agent of the plaintiff, Nehemiah Osborne, one of the makers of the note, whether he wanted the note paid then, and that said attorney and agent of said defendant intimated that said note might wait the result of the

App. Div.]

FOURTH DEPARTMENT, NovEMBER TERM, 1901.

reference to be taken upon the claim presented by the plaintiff, and that the claim need not be paid now, meaning at that time; that thereafter the aforesaid stipulation of reference was made and signed by the respective parties; that in entering into said stipulation the plaintiff relied upon aforesaid statements of said attorney and agent of the defendant; that during the trial of this action before me, the said attorney for the defendant introduced the note as a counterclaim; that thereupon the plaintiff, in open court, offered to pay the amount due upon said note and made a tender in open court on Sept. 28, 1900, of one hundred and ten dollars and fifty cents, the amount then due upon said note, which was not accepted."

Frank W. Ballard, for the appellant.

H. B. Cone, for the respondent.

SPRING, J.:

The amendment to section 2863 of the Code of Civil Procedure, giving a justice of the peace jurisdiction of a demand against an executor or administrator, was added by chapter 527 of the Laws of 1895, and vests that official with authority "where the amount of the claim is less than the sum of fifty dollars, and the claim has been duly presented to the executor or administrator and rejected by him."

Is the claim in the present case the one presented and rejected, or the amount of that claim, less the counterclaim allowed by the referee?

The counterclaim was for borrowed money, was entirely independent of the claim presented, and existed against the plaintiff and one Osborne. It was optional with the defendant whether this was offered as a counterclaim. The defendant might elect to sue the two makers of the note in a separate action, preferring to recover judgment against both of them than risk the hazard of collecting against the plaintiff. The defendant had disputed the claim presented, and the controversy upon the trial was wholly over that demand. If the defendant succeeded in defeating that demand she probably could not recover any affirmative judgment against the plaintiff. (Mowry v. Peet, 88 N. Y. 453; Eldred v. Eames,

FOURTH DEPARTMENT, NOVEMBER TERM, 1901.

[Vol. 66.

115 id. 401.) And even if that were possible she might not desire it. The plaintiff by admitting the validity of the note could not confer jurisdiction upon the justice. The defendant had control of the counterclaim, not the plaintiff or the justice. If the counterclaim had exceeded the claim presented by forty dollars, and Osborne, the other maker of the note, had resided in Suffolk county, and all the note except the forty dollars had been allowed as a counterclaim against the protest of the defendant and applied in extinguishment of the plaintiff's claim, if the plaintiff were irresponsible, that determination would leave the defendant to recover the balance due upon the note in a suit in a Justice's Court against Osborne in the county of Suffolk. The court would have no right to put the defendant to that extremity against her will. The point is that where the person sued upon a demand has a claim not arising out of the transaction which gave birth to the cause of action sued upon, there is no obligation that the defendant must have his claim determined in the forum chosen by the plaintiff. Jurisdiction cannot be bestowed upon a court of limited power to determine a demand where that jurisdiction depends upon an admission of a claim of this kind. The defendant has the sole dominion over his claim, and it rests with him to present it or not as he likes. It does not become a counterclaim until he consents to

make it so. If the plaintiff in this case had brought her action in a Justice's Court, and proved her claim and rested, a dismissal of her cause of action would have followed, because not within the jurisdiction of the justice. If she had admitted the claim and sued for the balance, the defendant could still have refused to submit the validity of her claim to be determined. She might not wish to have complicated it with the one she was contesting, and it could not be dragged in without her consent.

The soundness of this conclusion is well illustrated by another subdivision of this same Code section. A justice of the peace has no jurisdiction where "the sum total of the accounts of both parties proved to the satisfaction of the justice exceeds four hundred dollars." (Code Civ. Proc. § 2863, subd. 4.) In construing this provision, or rather a like provision in the Revised Statutes, the courts have repeatedly held jurisdiction was not conferred by the plaintiff admitting the demands of the defendant as a set-off or counterclaim

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where the two claims exceeded $400. In Lund v. Broadhead (41 How. Pr. 146) the plaintiff sued in the Supreme Court on a claim of $450 and admitted that the defendant had a counterclaim or set-off to the plaintiff's account amounting to $409.13. On the trial he recovered $40.87, and costs were taxed in his favor. On the motion for their readjustment on the ground that the justice of the peace had jurisdiction, Judge MARVIN, in a well-considered opinion, held that the admission of the counterclaim did not bring the action within the compass of a justice of the peace; that only by payments or where it appeared by the complaint "that the parties had settled the accounts and struck a balance" could the action be maintained in a Justice's Court. The learned judge says (at p. 150): "The admission is that the defendants have a counterclaim or set-off and the plaintiff asked judgment for the balance. Suppose the defendants had denied the complaint and had not plead a counterclaim or set-off, what would have been the condition of the plaintiff? If the demands of the defendants were counterclaim or set-off, the plaintiff had no power to apply them in the reduction of his account. If the defendants refused to plead and prove their counterclaim or set-off, they could have sued and recovered the whole amount, and if the plaintiff had contented himself with a judgment for the balance, he might be subjected to great loss." (See, also, Griffen v. Brown, 35 How. Pr. 372; Sherry v. Cary, 111 N. Y. 514, 517; Lablache v. Kirkpatrick, 8 Civ. Proc. Rep. 340; Hayes v. O'Reilly, published in connection with case last cited at page 347.)

It is contended that inasmuch as the Code of Civil Procedure, section 2718, provides that the executor or administrator may require the claimant to support his claim by his affidavit, "that no payments have been made thereon and that there are no offsets against the same to the knowledge of the claimant," that the real claim is the sum unpaid after deducting whatever offsets or counterclaims may exist. This provision was operative long before the amendment of the Code of Civil Procedure mentioned giving courts of the justice of the peace jurisdiction in entertaining claims under fifty dollars against an executor or administrator. (See 2 R. S. [4th ed. 1852], pt. 2, chap. 6, tit. 3, § 40 [35] p. 274.) The object of this requirement is to prevent imposition upon estates of

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