In Powell v. Waldron (89 N.Y. 328) it was held that a membership in the New York Cotton Exchange was property and as such passed to a receiver appointed in supplementary proceedings on an execution against the owner, and that the receiver had a right to redeem the seat when it had been pledged by the judgment debtor as collateral for a loan.Summary of this case from People ex Rel. Lemmon v. Feitner
Argued May 5, 1882
Decided May 30, 1882
Raphael J. Moses, Jr., for appellants. Archibald C. Shenstone for respondent.
We think the right of the judgment debtor to a seat in the Cotton Exchange was property. That it had value was proved and is conceded; and that it could be transferred to a certain class of purchasers, under prescribed rules and conditions, is also established. The defendants took it as collateral to the note of Robbins and held it as security for that debt, and thereby plainly treated it as valuable property. Although of a character somewhat peculiar, its use restricted, its range of purchasers narrow, and its ownership clogged with conditions, it was nevertheless a valuable right, capable of transfer and correctly decided to be property. ( Hyde v. Woods, 4 Otto, 524; Ritterband v. Baggett, 42 Supr. Ct. [10 J. S.] 556; Grocers' Bank v. Murphy, 11 Week. Dig. 538; In re Kecham, a Bankrupt, Daily Reg. Feb. 9, 1880.) It was something more than a mere personal license or privilege, for it could pass from one to another of a certain class of persons and belong as fully to the assignee as it did to the assignor. That characteristic gave it not only value which might attach to a bare personal privilege, but market value which usually belongs only to things which are the subjects of sale. However it differed from the incorporeal rights earlier recognized and described, it possessed the same essential characteristics. It could be transferred from hand to hand and all the time keep its inherent value, and be as freely and fully enjoyed by the permitted purchaser as by the original owner. We should make of it an anomaly, difficult to deal with and to understand, if we failed to treat it as property. The authorities which determine it to be such, seem to us better reasoned and more wisely considered than those which deny to it that character, although the subject of ownership, of use, and of sale.
Being property, it passed to the receiver in the supplementary proceedings, subject to the lien or right of the defendants. It bears no resemblance to the resulting trust referred to in Underwood v. Sutcliffe ( 77 N.Y. 62), for that vested wholly in the creditor for whose benefit it was raised, and no estate or interest, legal or equitable, remaining in the debtor, there was nothing for his receiver to take. Nor does it matter that the creditor, by his judgment previously obtained, had gained some hold upon and right to the seat considered as property. If he had a double remedy it was not for the defendants to dictate which he should pursue. There is but one claimant and no conflict of title. Nor are the defendants aided by the alleged defects in the appointment of the receiver. The judgment debtor consented and thereby waived all irregularities. ( Tyler v. Willis, 33 Barb. 327; Morgan v. Potter, 17 Hun, 403.) The defects suggested were of that character, and cannot be considered between the present parties and in a collateral action. The right of the plaintiff, therefore, to redeem the seat of Robbins, upon payment to the defendants of the debt as security for which they held it, appears to us clear. Upon tender of that amount all right of the defendants to retain the seat and certificate disappeared, and they were bound to restore and assign it to the receiver. Whether he could make it available, or in what manner convert it into money, or how it might prove to be incumbered under the rules of the Exchange, are after questions in which the defendants have no present interest.
They insist, however, that the plaintiff mistook his remedy, and should have resorted to a legal instead of an equitable action. He came into court upon a complaint setting forth what he claimed to be an equitable cause of action and asking the appropriate relief. As to him no mistake was made in treating it and trying it as such. ( Davison v. Associates of Jersey Co., 71 N.Y. 340.) The defendants were at liberty to question its character, but what they did was merely to demand a trial by jury. The request was ambiguous. It was not necessarily inconsistent with a concession that the action was of an equitable character, for in such actions a jury trial of one or more of the issues of fact may be granted or refused in the discretion of the court. (Code, §§ 971, 972.) But probably the request meant and was understood to mean something else. It was doubtless intended as a contention, that upon the facts stated there was a legal cause of action which should be tried before a jury. The ruling held the contrary and the defendants excepted. This ruling was right on the assumption that it was an equitable and not a legal action which was being tried. That was certainly the fact. No common-law judgment was rendered. That, as the case stood, could only have been for damages, but the relief awarded was that the defendants assign the certificate to the plaintiff. Practically the defendants' demand and the ruling of the court made it impossible for the plaintiff to turn his equitable action into one at law; left him deprived of an alternative; and compelled him to stand or fall in equity. Thus far there was nothing of which defendant could complain. The case was narrowed to an equitable cause of action or none, and the way was cleared by the ruling of the court to a consideration of that question. But it was not raised. A motion to dismiss the complaint, or for judgment on the facts as proved, on the ground that no equitable cause of action was shown, would have reached and tested all that remained of the case. The motion which was made went upon other grounds. It did not deny or challenge the equitable jurisdiction. No exception was taken to the finding of facts, and none to the legal conclusion that upon those facts the plaintiff was entitled to the equitable relief demanded by his complaint, and the question now sought to be argued is in no manner presented for our review. The defendants submitted to the equitable jurisdiction by not objecting to it. The trial court was not asked to say that there was no equitable cause of action by reason of an adequate remedy at law, or for any other reason which would bar the jurisdiction of equity, and we cannot consider such objection when urged for the first time on appeal. ( Clarke v. Sawyer, 2 N.Y. 498; Truscott v. King, 6 id. 147; DeBussierre v. Holladay, 55 How. Pr. 210.)
We think no error was committed in the disposition of the case and the judgment should be affirmed, with costs.
All concur, except MILLER and TRACY, JJ., absent.