Opinion
March, 1901.
Walter J. Rosenstein, for appellants.
Max D. Steuer, for respondents.
This was an action brought to recover certain chattels, to wit, skirting, silks, etc. The chattels sought to be recovered were sold by the plaintiffs on credit, between December 2, 1898, and January 26, 1899, to Isaac Steinman; they were sold to him after he had made a so-called credit statement, to wit: "My assets are as follows: Merchandise on hand, $8,000; fixtures, valued at $500; my outstanding accounts and notes amount to $4,898.15; accounts past due, $300, which I value at $75.00; Cash in National Citizens Bank, $3,200.65; making a total of assets of $16,673.80; liabilities for merchandise, $727.25, leaving a surplus of $15,946.55."
The plaintiffs claim that they relied upon said statement, believed it to be true, but that they subsequently discovered it was false, and that it was known to Steinman to be false at the time he made it. The plaintiffs rescinded the sale and demanded the return of the property from Steinman, but the return of it was refused. Before the plaintiffs could get possession of the chattels, and on the 27th day of January, 1899, the defendants Marx and Jacobs obtained a bill of sale from Steinman, and took possession of all the property that Steinman had, and among other goods, the chattels mentioned in the complaint. On January 27, 1899, the plaintiffs demanded from Marx and Jacobs the return of these goods, but the return thereof was refused, and thereupon this suit was commenced against Marx and Jacobs, as well as Steinman, for the recovery of these chattels. Steinman, however, was never served with the summons and made a defendant herein; his name is simply mentioned in the title as a defendant.
This appeal is taken only on exceptions raised at the trial to the admission or rejection of evidence, and exceptions taken to the charge. This is authorized. Rosenstein v. Fox, 150 N.Y. 354.
The plaintiffs, to substantiate the question of fraud on the part of Steinman, called a witness by the name of Harry R. Rodman, to prove by him that although, in December, 1898, said Steinman in his credit statement stated that his cash in the National Citizens Bank was $3,200.65, he drew it nearly all out, and that on January twenty-sixth or twenty-seventh he only had a balance in said bank of $1.03, and that, having withdrawn all that money on the same day, to wit, January 27, 1899, sold all his property to the defendants Jacobs and Marx. Said witness Rodman testified substantially as follows: "I am employed at the National Citizens Bank as book-keeper. On January 25, 1899, I was in the receiving department of said bank. In order to enable myself to tell the facts to the jury, I have prepared a transcript of the account of Isaac Steinman. I have examined the books of the National Citizens Bank to ascertain what Steinman's balance was on January 26th and 27th, 1899. I am able to state from my transcript from those books what his balance was on the 26th and 27th of January, 1899; it was $1.03." On cross-examination he testified: "My duties in the bank at present are those of a book-keeper. In January, 1899, I was assistant in the receiving department, at the receiving teller's desk. The facts as testified to by me are as taken from the books, and the only knowledge I have on that subject is what was taken from the books entirely." This testimony was received under objection as being incompetent, and to which exception had been duly taken. There is no proof whatever that the witness had any knowledge as to the accuracy and correctness and regularities of such entries in the bank's books. It does not appear that he made those entries himself or that he saw them being made, and that they were correctly made. The rule of law seems to be that entries in the books of a bank can only be proven by the clerk making them, or who saw them being made, and knew them to be correctly made at the time. In no event can such entries be admitted in evidence nor testified to by anyone, unless that person testifies from personal knowledge as to the correctness of the entries. Ocean National Bank v. Carll, 55 N.Y. 440; Churchman v. Lewis, 34 id. 444; State Bank of Pike v. Brown, 165 id. 216. The evidence thus wrongfully admitted must have played a very material part in the minds of the jury in determining the question of fraud. It was, therefore, harmful to the defendants, and a reversal of the judgment must follow.
There is another exception taken, which we claim is well taken. We claim it was error to admit the testimony of Joseph Horowitz, one of the plaintiffs, as to a conversation between himself and Steinman in December, 1899, in the absence of the defendants, nearly a year after the defendants had purchased Steinman's stock of merchandise.
The defendants are the assignees of Steinman of the goods in suit and had taken possession of them on January 27, 1899. The conversation that Joseph Horowitz testified to was substantially as follows: "I asked Steinman, `how is it you made a statement to me that your assets were Fifteen thousand dollars on Dec. 1st, and only, it is not quite two months and you have lost all your money'? and he said, `well, I will tell you, I have not lost my money, but to tell you the truth I never had it. At that time I was not worth $15,000, or worth $10,000 or $8,000. At that time I was worth about $2,000, when I made that statement; but I don't know what happened to me; in an insane moment, it made me do it, and I made statements all around and obtained goods, and then went to Philadelphia and sold the place to Jacobs and Marx, and then went to Philadelphia, and then to England, and from England to Africa." The rule of law is that admissions of an assignor of chattels are not admissible against the assignee when made after the assignment and transfer of possession. Coyne v. Weaver, 84 N.Y. 386-392; Strauss v. Murray, 31 Misc. 69; Flannery v. Van Tassel, 131 N.Y. 639; Bush v. Roberts, 111 id. 278-282. We maintain that the evidence was clearly incompetent, being the declaration of an alleged fraudulent vendor, made after his conveyance and in the absence of his vendees, nearly a year after the sale was made and possession transferred. There are other exceptions, but deeming these two controlling, we do not propose to go into their details.
Judgment appealed from reversed and new trial ordered, with costs to the appellants to abide the event.
DELEHANTY and McCARTHY, JJ., concur.
Judgment reversed and new trial ordered, with costs to appellants to abide event.