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and 120 New York State Reporter holding that there were presented questions of fact which should have been submitted to the jury. Upon the new trial the plaintiff contented herself with proving the signature and the amount of interest due, and, relying upon the presumption of delivery from the possession of the note, offered it in evidence, and rested. The defendants moved to dismiss the complaint, and to the denial of their motion ercepted, and then in turn rested; and, the plaintiff having moved for a direction in her favor, that motion was granted, and to this ruling the defendants excepted, so that it is these exceptions to the refusal to dismiss the complaint and to the direction of a verdict for the plaintiff which are now urged upon our attention.

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Had this been a negotiable promissory note in the usual form, we do not think it would be seriously contended that upon such a record as is here presented a direction of a verdict would not have been proper. The defendants contend, however, that, though this instrument be regarded as a promissory note, it is of an unusual kind, and that all the parts of the instrument must be read together, and that, inasmuch as on its face it purports to state a consideration which is neither a legal nor a valid consideration, the one expressed takes the place of the valid consideration which, if such a statement had not appeared upon the face of the note, would be presumed. For this proposition the appellant claims support by taking certain language in our former opinion away from its context, and considering it apart from the subject in the discussion of which it was used. The portion from which the appellants get most comfort is the following:

"The recital is that the deceased had been the cause of a money loss. This. standing alone, would be insufficient to show the existence of a present legal consideration, or that an enforceable obligation had ever existed. * we eliminate the declaration of the plaintiff that the deceased owed her a debt

, then we have nothing in the oral testimony or in the recital of the instrument to establish that there at any time existed a legal enforceable obligation against the deceased in favor of the plaintiff, or that the facts were of such a character as would estop the deceased from denying her legal obligation for the payment of the money."

This language was not intended to be, nor was it, confined to stato ing that the recital which preceded the promissory portion of the instrument was conclusive either upon the plaintiff or the defendant, What the court was discussing was whether, upon all the evidence —that presented on the face of the instrument, together with such corroborating evidence as the plaintiff adduced upon that subject, as offset by the testimony offered by the defendants--the situation was one which, upon the question of consideration, required that their case should be submitted to the jury (which was the conclusion we reached), or whether the trial judge was right on the first trial in directing a verdict. As we have pointed out, upon the present trial there was practically no evidence given except such as was needed to entitle the paper to be admitted in evidence. That the paper was a promissory note was expressly held upon the former appeal, and in the following language:

“Following the declaration of trust the instrument contains a promise to pas, one year after date, or on demand, to the order of the plaintiff, her heirs or assigns, $3,000, with interest. There are no words of limitation of this promise




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in the language preceding it. The promise to pay is express, and is to the order of the payee, and contains every essential element to constitute a promissory note as defined by the negotiable instruments law (chapter 612, p. 755, $ 320, Laws 1897) and by authority. Carnwright v. Gray, 127 N. Y. 92 (27 N. E. 835, 12 L. R. A. 845, 24 Am. St. Rep. 424)."

The contention of the appellants may be well founded that if, on the face of the instrument, it conclusively appeared that there was no consideration, or that there was an invalid consideration, then the instrument could not be enforced. For the reason, however, that neither of these appeared upon the face of the instrument, we think that, taking the legal presumption which arises in favor of there having been a valid consideration for the note, and in the absence of any evidence to rebut it, a prima facie case was made out.

In Hegeman v. Moon, 131 N. Y. 462, 30 N. E. 487, the deceased made an instrument as follows:

"One year after my death I hereby direct my executors to pay to Joseph Hegeman, bis heirs, executors or assigns, the sum of $1,976.90, being the balance due him for cash advanced at various times by him to Adrian Hegeman, my son, and others, as per statement rendered by him this day without interest."

In that case, as in this, the inference was sought to be drawn from the language employed in the note that there was no legal consideration; but the court said:

"The addition of the words that the money is due the payee 'for cash advanced at various times by him to Adrian Hegeman, my son, and others, as per statement rendered by hin this day,' does not alter the implication that the money is due the payee from the maker. It simply states the origin of the indebtedness of the maker. "It was not for money advanced directly to her, but to her son and others. There is nothing inconsistent with her indebtedness to the payee in the fact of this acknowledged advance of the money to the maker's

An original indebtedness may have arisen against the maker by the payee advancing at the maker's request moneys to her son. And when she says that a certain amount is due the payee, and signs the statement, with the addition of the origin of the indebtedness, the implication is neither forced nor unnatural that she means that the amount is due from her, or else she would not have signed the paper.”

We think the respondent is right in asserting that the principle of the Hegeman Case and the one at bar are precisely the same, and that, as in the former the court was bound to presume in support of the obligation that the money advanced to a third person by the payee was advanced at the maker's request, and thus constituted a legal obligation on the part of the maker, so, in the present case, the court is bound to assume that the money loss which the plaintiff, the payee, had suffered at the hands of the maker, was legally chargeable to the maker, and constituted a legal liability on her part.

Our conclusion therefore is that the disposition made by the learned trial judge was right, and that the judgment appealed from should be affirmed, with costs. All concur.


and 120 New York State Reporter


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(Supreme Court, Appellate Division, First Department. March 11, 1904.) 1. TEMPORARY INJUNCTION-PERMANENT RELIEF-VATURE OF Action,

Code Civ. Proc. 603, provides that where it appears from the complaint that the plaintiff demands and is entitled to judgment against defendant, restraining the commission or continuance of an act the commission or continuance of which during the pendency of the action would produce injury to plaintiff, an injunction may be granted to restrain it; the case provided for being one where the right to an injunction depends on the nature of the action. Held, that where, in a suit to restrain defendants. individually and as officers and directors of a corporation, from holding any meetings or from disposing of any of the treasury stock of the corporation until after final decree, the plaintiff made no demand for permanent relief which a court of equity might decree, the court had no au

thority to grant a temporary injunction. 2. SAME-EVIDENCE.

Where, on an application for a temporary injunction, plaintiff's alleggtion in his complaint and affidavit, so far as they set forth facts charging any improper management on the part of defendants as directors of a corporation, were either made on plaintiff's "understanding," or on informtion and belief, and the basis of complainant's understanding, or the source of his information, or the grounds of his belief, were not stated, such de fect was not cured by the joint affidavit of others that the allegations of plaintiff's complaint and affidavit are true; the effect of such joint affidavit being only that plaintiff's understanding, information, and belief

were as alleged. 3. SAME.

Where plaintiff, who was president and owner of the majority of the stock of a corporation, sought to restrain the sale of the corporation's treasury stock by defendants who formed the majority of the board of directors, on the ostensible ground that they were attempting to dispose of the stock, without consideration, to the injury of the corporation, and asked a temporary injunction restraining such sale until after a special meeting of the directors called by plaintiff for the election of directors, but it was manifest that plaintiff's object was not to obtain a permanent injunction, but was to restrain the directors from selling sufficient stock to render him a minority holder and prevent his controlling such election, an order granting such temporary injunction was erroneous.

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Appeal from Special Term, New York County.

Suit by George H. Gillette against Horatio T. Noyes and others. From different parts of an order granting a temporary injunction, both parties appeal. Reversed.


The relief demanded in the complaint is an injunction order restraining the defendants, individually and as officers and directors of the defendant corpora. tion, "and any and all other person and persons," from holding a special meeting of the board of directors of the defendant company on the 30th day of Norem. ber, 1903, and from disbursing any of the assets of the company, including its capital stock, "and from holding any meeting or meetings whatsoever pursuant to any alleged authority claimed to be invested in them, or either of them, or in any manner interfering with the assets, capital, or treasury stocks, patents, or other property of the defendant corporation," or interfering with the company or the rights of the plaintiff and other stockholders therein, "until the final judgment and decree in this action, and for such other and further relief in the premises, as may be just and equitable, besides the costs and disbursements of this action.” The plaintiff alleges that the defendant company was incorporated under the laws of the state of Maine; that he owns or controls the inajority of the capital stock issued and outstanding; that the individual de


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fendants are directors of the company, and constitute a majority of the board ; that the individual defendants received their stock upon the understanding that they would promote the interests of the company, and procure for it sufficient money to bring about the success of the patents which it owns, but that, instead of doing so, they “have repeatedly taken such steps and measures as would bring upon the company financial disaster"; that, at a conference of the board of directors, it was agreed that the number of directors should be increased from five to seven, and that from among the stockholders of the company two new directors should be elected, who would "insure the procurement of capital very necessary to the welfare" of the company; that, acting upon this understanding, the plaintiff on the 25th day of November, 1903, caused notice of a special meeting of the stockholders for that purpose to be mailed to each stockholder; that it was understood and agreed "that the corporation would continue as it was, without hindrance or molestation from any of the directors or stockholders," until such special meeting, but, notwithstanding such understanding, and in violation of the by-laws, the individual defendants, "with the avowed purpose of transferring and illegally disposing of the treasury stock, assets, franchises, and patents” of the company, have called a special meeting of the board of directors for the 30th day of November, 1903, and, if the meeting be held, “this plaintiff is informed and verily believes that the patents, assets, franchises, property rights, and treasury stock of the said defendant corporation will be disposed of, and said defendants threaten to and are about to dispose of the same, without any consideration, to the detriment and injury of the defendant corporation, and the irreparable loss to the stockholders thereof"; that the plaintiff is the president, and the by-laws provide that special meetings oć the board of directors shall be called by the president; that “this action is brought for the purpose of restraining the holding of said special meeting, and to prohibit the fraudulent transfer of the company's stock or assets, in the belief that, if the stock of the said defendant corporation is so disposed of, the said stockholders will have no adequate remedy at law, these defendants, as this plaintiff is informed and believes, would be unable to respond to a judgment for damages.” The order, among other things, enjoins the company, its officers, directors, and stockholders, from disposing of the assets or property of the company, including its capital stock, and from holding any meetings whatsoever, and “from in any manner interfering with the assets, capital, or treasury stock, patents, franchises, or other property” of the company, and “from in any manner interfering with” the company, or of the rights of the plaintiff and other stockholders therein.

The plaintiff appeals from so much of the order as enjoins a meeting of the stockholders, and the defendants appeal from the rest of the order. The affidavit of the plaintiff states that the purpose for which the company was organized was to further a patent invented by him for a cap on bottles, and that in his opinion the invention is of great value; that the individual defendants induced him to turn over to them certain capital stock upon representations that they would interest capitalists in the company, which they have not done; that it was recognized by all that the company was in need of capital, and, with that end in view, it was agreed that the board of directors should be increased from five to seven, substantially as stated in the complaint; that it was his understanding-but he does not say from what he derived the understanding—that the company would not be interfered with until the special meeting of the stockholders for the purpose of increasing the directors, "but I am now informed that, in utter disregard of said understanding, and with the deliberate purpose of injuring the company, and disposing of its treasury stock, assets, patents, and property holdings," the individual defendants, as stockholders and directors, have called a special meeting of the board, as stated in the complaint, "at which they intended to dispose of the said treasury stock and the assets of the said corporation before the special meeting of the stockholders can be held.” The plaintiff also presented a joint affidavit, made by three individuals, to the effect that the matters alleged in the complaint and in his affidavit are true, and that they have had numerous interviews and conferences with two of the individual defendants, “and, from what they told us, we believe and know that they intend to transfer, without any consideration, the treasury stock of the said corporation, as well as to injure the said com

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and 120 New York State Reporter pany, at the special meetings of the directors they have illegally called.” An affidavit made by each individual defendant was presented in opposition to the motion, showing that the special meeting of the board of directors was called for the sole purpose of considering the advisability of retaining in the employ of the company a brother of the plaintiff, whose term of service expired on the day for which the meeting was called; that, at the time for which the meeting was held, a conference was held, without a formal meeting of the board, and a satisfactory arrangement was made with reference to continuing the services of the plaintiff's brother, which rendered it unnecessary to hold the meeting, although no injunction had been served, and the individual defendants had no knowledge that it had been obtained; that the entire capital stock of the company was issued to the plaintiff in consideration of a transfer of certain let. ters patent, upon the understanding, however, that he was to turn over to the corporation capital stock of the par value of $200,000, which was to be sold by the corporation to provide funds for the purpose of promoting the patent

, and that he was also to turn over capital stock of the par value of $200,000 to the defendant Noyes, and a like amount to the defendant Horace G. Stripe, and retain capital stock of the par value of $400,000 for himself; that this agreement for the distribution of stock was consummated; that the company's only means of raising funds at present is by a sale of this treasury stock; that part of the treasury stock has been sold from time to time, but that the company is Dom in pressing need of funds for the purpose of completing and perfecting a ma: chine for the purpose of demonstrating the practicability of the patent, to enable them to make contracts with brewers for the use of the machine; that it is the custom of brewers to make their contracts on or about the 1st of January, Each of the individual defendants denies any intention to sell any property of the corporation, other than its treasury stock, which they deem it necessary to sell, as heretofore, for the purpose aforesaid.

Argued before VAN BRUNT, P. J., and HATCH, PATTERSON,

John P. Everett, for plaintiff.
Danl. P. Hays, for defendant.

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LAUGHLIN, J. As is shown by the statement of facts, the plaintiff makes no demand for any permanent relief which a court of equity may decree, and therefore there is no authority for granting a temporary injunction in this case, where the right thereto depends upon the nature of the action. Code Civ. Proc. $ 603. The allegations of the complaint and the statements contained in his affidavit, so far as they set forth facts charging any improper management on the part of the directors, are either made upon his understanding or upon information or belief, and neither the basis of his understanding, nor the sources of his information, nor the grounds of his belief are stated

. This defect is not cured by the joint affidavit, which, when applied to the allegations of the complaint and to the plaintiff's affidavit, merely is to the effect, so far as these matters are concerned, that it is true that plaintiff's understanding, information, and belief are as alleged and stated. The injunction order has had the effect of completely tying the hands of the board of directors, and it appears, as might be expected, that the business of the company is at a standstill in consequence thereof. The provision of the order enjoining special and annual meetings of the stockholders, of which the plaintiff complains, is drastic, but it was evidently imposed as a condition of awarding that part of the injunction which the plaintiff desired. It is evident that ihere is a serious disagreement between the plaintiff, who owns or controls a majority of the outstanding stock, and the individual



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