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satisfied, and to allow the plaintiff to recover again would be to allow him to receive satisfaction twice upon one debt."

So, in this case, defendant presented his claim to the town auditors as against the town, and accepted the sum that they allowed thereon in payment. We think the transaction extinguished his claim against the plaintiff, if any such claim ever existed. The judgment of the county court should be reversed, and that of the justice affirmed, with costs to appellant in this court and in the county court. All concur.

(70 IIun, 197.) WHITE et al. v. REID.

(Supreme Court, General Term, First Department. June 30, 1893.) ACTION ON FOREIGN JUDGMENT-DEFENSES-FRAUD.

In an action in New York on a judgment obtained in Massachusetts, defendant can show that he had a valid defense which he set up in the original suit, and that the judgment was obtained by the fraud of plaintiff, who induced him to abandon the further defense on assurance that he would discontinue the action.

Appeal from circuit court, New York county.

Action by David A. White and another against Wilson Reid. From a judgment entered on direction of a verdict, defendant appeals. Reversed.

Argued before VAN BRUNT, P. J., and FOLLETT and BARRETT, JJ.

Daniel D. Shermán, for appellant.
Kidder & Melcher, (J. S. Melcher, of counsel,) for respondents.

VAN BRUNT, P. J. This action was brought upon a judgment recovered by the plaintiffs against the defendant in the superior court of the commonwealth of Massachusetts. The defendant, in his answer, admitted the bringing of the suit, and that he appeared therein and set up his defense, and that judgment was thereafter entered in said suit as alleged in the complaint. In order to avoid the effect of this admission, the defendant, further answering, alleged that he had, and now has, a gcod and valid defense to said action, and the plaintiff had no valid cause of action; and that in November, 1890, said judgment being entered on the 5th of January, 1891, the defendant was induced by fraudulent representations and assurances of the plaintiffs, made to the defendant and one of his codefendants, and upon which he relied, to the effect that said action would be discontinued, to abandon his defense to said action, and not to appear further therein, and that the plaintiffs fraudulently and without the knowledge of the defendant procured the judgment mentioned in the complaint to be entered against him. Upon the trial a verdict was directed in favor of the plaintiffs upon the pleadings, upon the ground, we imagine, which is urged befcre this court, viz. that the fraud for which a judgment may be avoided must be such as prevented the defendant from ever appearing in the suit, and that when the defendant has appeared and set up his defense in the foreign state all subsequent proceedings in that suit, including the judgment, are conclusive upon him, because he has had his day in court, and should not be allowed to try the issues again. This, we think, is an entirely erroneous view to take of the sanctity of the judgment of a sister state, such judgment not being a foreign judgment. The constitution of the United States provides that full faith and credit shall be given in this state to the public acts, records, and judicial proceedings of every other state; but such provision does not give greater force to the judgment of a sister state than that which obtains in our own state. Many cases have occurred in our own state where the validity of judgments has been attacked upon the ground of fraud, and where the defendant has been deprived of his defense by the fraud of the plaintiff with the connivance of his attorneys; and we are somewhat surprised that the jurisdiction of the court in this respect should be questioned. That such jurisdiction exists is expressly recognized in Mayor, etc., v. Brady, 115 N. Y. 617, 22 N. E. Rep. 237; Pom. Eq. Jur. p. 400; and in U. S. v. Throckmorton, 98 U. S. 61, where the court, speaking of the evidence of this power, defines it as follows:

"If the court has been mistaken in the law, there is a remedy by writ of error. If the jury has been mistaken in the facts, the remedy is by motion for a new trial. If there has been evidence discovered since the trial, a motion for new trial will give appropriate relief. But all these are parts of the same proceeding. Relief is given in the same suit, and the party is not vexed by another suit for the same matter. So in a suit in chancery, on proper showing, a rehearing is granted. If the injury complained of is on erroneous decision, an appeal to a higher court gives opportunity to correct the error. If new evidence is discovered after the decree has become final, a bill of review on that ground may be filed within the rules of law on that subject. Here, again, these proceedings are all parts of the same suit, and the rule framed for the repose of society is not violated. But there is an admitted exception to this general rule in cases where, by reason of some. thing done by the successful party to a suit, there has been in fact no adversary trial, or decision of the issue in the case. Where the unsuccessful party has been prevented from exhibiting fully his case by fraud or deception practiced on him,-as by keeping him away from court by a false promise of a comprounise; or where the defendant never had knowledge of the suit, being kept in ignorance by the act of the plaintiff; or where an attorney fraudulently or without authority assumes to represent the party, and connives at his defeat; or where an attorney regularly employed corruptly sells out his client's interest to the other side,-these and similar cases which show that there has never been a real contest in the trial or hearing of the case, are reasons for which a new suit may be sustained to annul the former judgment and decree, and open the case for a new and a fair hearing.”

We think, therefore, that the court erred in directing judgment upon the pleadings, as seems to have been done, upon the ground that, the defendant having appeared in the action in Massachusetts, his defense could not be sustained. This being the only question presented upon this appeal, we think that the judgment should be reversed, and a new trial ordered, with costs to appellant to abide the event. All concur.

(70 IIun, 186.)
DOW v. IOWA CENT. R. CO. et al.

(Supreme Court, General Term, First Department. June 30, 1893.) RAILROAD COMPANIES-REORGANIZATION-LACHES OF STOCKHOLDERS.

Railroad bondholders agreed to purchase the road at foreclosure sale and reorganize it, and empowered a committee named to give to the holder of each share of stock a share in the reorganized company on payment of $15. It was further provided that holders of stock in the old company should be deemed to have declined such privilege after 20 days' notice, and that on failure to pay such sum the privilege of receiving new stock on making such payment should pass to other stockholders and creditors. The property was bought in as agreed, and the committee provided for payment of the $15 in seven installments. The holder of some of the old stock died after paying the first installment, when the stock passed into the hands of the public administrator, who received various notices of installments on the $15 assessment, but failed to respond thereto. Held, that since the holder of such old stock had no rights in the property after foreclosure nor under the agreement, which was between the bondholders inerely, his successor in interest could not, after the failure to pay the $15 assessment in the stipulated time, demand a transfer of new stock on payment of that sum, on the ground that the bondholders' committee had taken no action to forfeit the rights of such stock under the agree ment.

Appeal from special term, New York county.

Action by Robert K. Dow against the Iowa Central Railroad Company and others. From a judgment of special term dismissing the complaint, plaintiff appeals. Affirmed.

Argued before VAN BRUNT, P. J., and FOLLETT and BARRETT, JJ.

Leopold Wallach, for appellant.
Foster & Thomson, for respondents Perkins and others.

Giraud F. Thomson, (James Thomson, of counsel,) for respondent Iowa Cent. R. Co.

VAN BRUNT, P. J. This action was virtually an action for specific performance, although other relief was asked. The facts in the case appear to be substantially as follows: In 1887 the Central Iowa Railway Company had made default in payment of interest upon its mortgage bonds and upon its car-trust certificates secured upon its rolling stock, and proceedings were commenced for the foreclosure of its mortgages. In these circumstances the bondholders and the holders of the car-trust certificates of said company entered into an agreement in writing among themselves, under date the 12th of May, 1887, looking to the purchase of the railroad and properties of said company. By said agreement they appointed the individual defendants in this suit a committee to carry out the plan of reorganization therein provided for, who duly accepted. The agreement contemplated a purchase of the property, and a reorganization of the same in the interest of the bondholders and holders of the car-trust certificates, and of such of the stockholders, preferred and common, of the old company, as might go in and assent to the said agree


ment upon the terms therein stated. The various portions of the road were afterwards sold under decrees of foreclosure entered in the circuit courts of the United States for the southern district of Iowa and the northern district of Illinois, and bought in for the said committee, who thereafter caused to be organized the defendant corporation Iowa Central Railroad Company, and conveyed the property so purchased by them to it. Among the provisions of the bondholders' agreement is the following: “The said committee are empowered to give to the holders of each share of the common stock of the present company one share of common stock of the reorganized company upon payment by such holder to the committee of fifteen dollars upon each share,” to be used by the committee as provided in the third article of said agreement; that is to say, for pay rolls and supply bills, secured claims, repairs and improvements upon the road and property, expenses of the committee, including counsel fees, and compensation to the members thereof, and other disbursements needed to effectuate their trust. The surplus of the funds arising from assessments was to be paid over to the reorganized company. It is further provided: "Should any holder of

common stock decline or fail to pay the assessment

of fifteen dollars, the privilege of receiving common stock of the reorganized company upon making such payment shall be ratably distributed among the holders of debt certificates and of preferred and common stock who shall have paid their assessments;" and in case they did not accept such privilege the same shall be allotted by the committee, in their discretion, to other persons who may be willing to accept the privilege and make the required payments. "Holders of such

common stock whose address is lodged with the committee, or noted upon the stock ledger of the company, shall be deemed to have declined the offer of the said privilege after twenty days' written or printed notice mailed to such person at such address. All persons making said payments

as shall be required by the committee will be entitled to receive for the amount thereof certificates of indebtedness of the reorganized company, which certificates will bear no interest; and the time for the payment of the principal shall be at the option of the company, but shall be convertible into preferred stock of the company.” Under the provisions of the agreement, the committee fixed the installments in which the $15 per share on common stock should be paid at seven in number,-six of $2 each, and the last of $3. At the date of this agreement John H. Rickins owned 1,000 shares of the common stock of the old company, represented by 10 certificates, each certificate being for 100 shares. He paid the installment of $2 per share, and his certificates were thereupon indorsed as follows: "Assent to agreement of May 12, 1887, with Edward H. Perkins, Russell Sage, Giles E. Taintor, Simon Borg, Edmund E. Chase, Charles C. Allen, James Thomson, Horace J. Morse, Committee. First installment, two dollars per share, paid. For the Committee, [Signed] Mercantile Trust Co. of New York. By C.

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Hunter, Cashier.” Almost immediately afterwards, Rickins died, and when the time fixed by the committee for the payment of the second installment of $2 arrived in January, 1888, the stock was held by the public administrator, Mr. Morrison, as administrator of Rickins' estate, and was so held by the public administrator until some time in December, 1891. During the period that the stock was so held by the administrator, notices of the various installments called for by the committee were mailed to the public administrator and to one Mr. Owen Murphy, at Toronto, who seemed to be looking after the interests of the next of kin of the decedent. Both Mr. Murphy and Mr. Arnold, the assistant of the public administrator, had interviews with Mr. Morse, the secretary of the committee, and were aware of the provisions of the bondholders' agreement, and knew that assessments were due and unpaid, and also that the administrator had no funds with which to make payment. None of the assessments were paid by the administrator. The committee, about April 28, 1889, issued the following notice, which was mailed to the administrator:

"Final notice. Holders of coupon debt certificates, 1st and 2nd preferred and common stock, who have not paid their assessments on the same, must do so on or before Wednesday, May 29th, or forfeit all participation in the reorganization. This notice is peremptory, and no further extension of time will be made."

The remaining installments, other than the first, which was paid by Rickins, were not paid by the administrator, and the stock was, "some time after April, 1890," purchased by the plaintiff, and the certificates delivered to him, with the indorsements aforesaid thereon, for about $276. In the latter part of December, 1891, the plaintiff tendered the amount which was due upon the various assessments upon the stock in question, which was declined upon the ground that the time had passed for the receiving of assessments; whereupon this action was commenced to compel the delivery of the stock. Upon the trial the complaint was dismissed, and from the judgment thereupon entered this appeal is taken.

The learned counsel for the appellant throughout the whole of his argument seems to claim that it was necessary that some action should be taken upon the part of the bondholders' committee (because it is to be observed that the agreement for reorganization was a bondholders' agreement, and a bondholders' agreement only) to forfeit some rights which the owner of the stock, whom he now represents, had in that reorganization agreement; but it seems to us that this is an entirely mistaken view to take cf the relations of the parties.

As already observed, the reorganization agreement was one of the bondholders only, and when the mortgages to secure these bonds had been foreclosed, and the property purchased by the reorganization committee, the holders of the stock had no interest in such property, having been cut off by the foreclosure proceedings. This being the condition of affairs, under this reorganization agreement, the committee were empowered to give to the holders of stock in the prior organization certain privileges

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