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(158 N.E.)

moneys so paid is predicated upon the subsequent payment to Greger by the railroad company of a sum of money in satisfaction of a claim for damages caused by the collision through which the automobile was destroyed.

When the insurance company paid to the assured the loss for which it had agreed to indemnify him, it, of course, became subrogated to any claim for the same damages which the assured might have against a wrongdoer who has caused the damage. Ocean Accident & Guarantee Corporation v. Hooker Electrochemical Co., 240 N. Y. 37, 147 N. E. 351. The receipt, which Greger gave to the insurance company at the time he received the stipulated indemnity from it, expressly recognizes the company's right of subrogation and contains a formal assignment of all claims against third parties to the extent of the amount of the payment.

or of the United States, including all claims and demands that I may now have; or that I, or my executors, administrators, or assigns hereafter may have by reason of said accident, under all or any or either of said laws."

for the amount which the insurance company has previously paid to Greger, in accordance with the terms of its own contract of insurance.

When the insurance company learned that Greger had begun and thereafter settled an action against the railroad company for damages suffered in the same accident in which the insured automobile was destroyed, it began this action against Greger and the railroad company. In its complaint it alleges that the automobile was destroyed by the negligence of the railroad company, and that the railroad company settled the action brought against it by Greger "after being informed of the fact that Maurice N. Greger was insured against any damages to his automobile as a result of a collision." The theory of the complaint, at least against the railroad company, is that in spite of the settle[2] In August of the same year Greger be- ment of the action and the release, the insurgan an action against the New York, Susque-ance company's claim by subrogation against hanna & Western Railroad Company for the railroad company is still in existence; yet damages caused by the collision in which his because of this settlement, summary judgautomobile was destroyed. The complaint in ment has been awarded in favor of the insurthat action states that, as a result of the col-ance company against the defendant Greger lision, "the automobile of the plaintiff was destroyed and plaintiff, who was riding therein, was thrown out and his collar bone broken, his arm dislocated at the shoulder and elbow and plaintiff received other severe lacerations about the face, left hand, and elbow and other parts of his body. That said injuries are permanent, and plaintiff underwent great pain and suffering as a result of said negligence. His clothing was destroyed and in divers other respects he suffered considerable damage and will continue to suffer damage in the future." Greger settled and discontinued his action against the railroad company, receiving in satisfaction the sum of $3,000. At that time he executed a release to the railroad company "from all debts, claims and demands whatsoever, and particularly such as have arisen by reason of, or in any manner grow out of but in no wise limiting this release for all damages sustained as a result of an automobile owned and operated by me colliding with a train of the defendant on or about April 1, 1923, at Rochelle avenue, Rochelle Park, Bergen county,, N. J., and for which suit was instituted by my attorneys, Messrs. Mackay & Mackay, by summons dated August 20, 1923, in the Bergen county circuit court." The release further recites:

"I understand and intend that this release shall operate to discharge the said New York, Susquehanna & Western Railroad Company and said other lines and companies from all claims or demands arising under the laws of any state

If the affidavits filed in support of the plaintiff's motion for summary judgment showed without dispute that the plaintiff had received from the railroad company full payment of the same damages for which he had been indemnified previously by the insurance company, then, doubtless, recovery against Greger for the amount paid to him might be sustained, upon the theory that the law will create an implication of a promise to repay an amount paid as indemnity for damages suffered, when the party, who caused such damages, has also made good the damages to the injured party. Darrell v. Tibbitts, 5 Q. B. Div. 560. Indeed, if such circumstances exist in the present case, the plaintiff insurance company would not be compelled to resort to the device of a promise implied in law; for Greger's claim against the railroad company for damages caused by the destruction of his automobile has been transferred to the insurance company to the extent of $2,000, and any payment thereafter made by the railroad company upon the claim which belongs to the insurance company would be held by the insured for the benefit of the insurance company. Weber v. Morris & E. R. Co., 35 N. J. Law, 409, 10 Am. Rep. 253; Hartford Accident & Indemnity Co. v. Chartrand, 239 N. Y. 36, 145 N. E. 274. The affidavits in this case do not, however, show

whether in view of all the circumstances, including the form of the complaint and of the release, the parties to the release ever contemplated that the railroad company should be released from any claim already transferred to the insurance company for damages to the automobile. Connecticut Fire Ins. Co. v. Erie Ry. Co., 73 N. Y. 399, 29 Am. Rep. 171. [5, 6] Even if it should appear that in fact the release was taken by the railroad com

company was subrogated to part of Greger's claim against the railroad company and was intended to cover all the damages suffered by Greger, it would still appear that the insur

that the railroad company has paid to the, instance. There is, indeed, a question of fact insured the damages for which he has already received indemnity from the insurance company. Even after the insurance company was subrogated to the claim of Greger, the insured, against the railroad company for the destruction of the automobile, Greger still had the right to proceed against the railroad company to recover for his own benefit any damages for personal injuries or to other property which were caused by the same accident. The complaint in the action brought | pany without knowledge that the insurance by Greger against the railroad company included a claim for personal injuries and for injury to property other than the automobile. Indeed the complaint is so phrased that it is not entirely clear that it was intended to in-ance company should recover only for the loss clude any claim for the loss of the automobile. Even a judgment entered upon a general verdict in an action which was brought to recover every loss suffered by negligence of the railroad company might not allow the inference that the judgment included the full sum paid to the insured for the loss of the automobile. Costello v. New York Cent. & H. R. R. Co., 238 N. Y. 240, 144 N. E. 514. Here no verdict was rendered, and it is not claimed that the amount paid by the railroad company to Greger represented more than a compromise of a disputed liability, and no inference can be drawn that it constituted a full payment for damages suffered. The judgment in the present action in favor of the insurance company against Greger can therefore not be sustained upon the theory that Greger has received from the railroad company moneys which equitably belonged to the insurance company.

it has sustained by that release. If Greger has acted wrongfully and in derogation of the rights of the insurance company, he should pay the damages which he has caused. After payment of the insurance money, the insurer became the equitable owner of any right of action of the assured to recover the same damages against the person primarily liable. The courts of some other jurisdictions have held that a release given by the assured to an alleged wrongdoer before payment by an insurance company of the damages caused by the alleged wrongdoer constitutes a defense to an action upon the policy, regardless of whether or not recovery might have been had against the wrongdoer if no release had been given. Sims v. Mutual Fire Ins. Co., 101 Wis. 586, 77 N. W. 908. We are not called upon to decide whether in the same circumstances we would reach a like conclusion. Here the insurance company asserts a claim [3, 4] It is urged that it may be sustained on against the assured for wrong and damages the ground that by the release to the railroad alleged to have been caused to it by the assurcompany the defendant Greger has destroyed ed. See Vooth v. McEachen, 181 N. Y. 28, the right of action which the insurance com- 73 N. E. 488, 2 Ann. Cas. 601; McAleenan v. pany had against the railroad company. The Massachusetts Bonding & Insurance Co., 232 release has certainly not destroyed the right to recover against the railroad company which the insurance company obtained by subrogation when it paid Greger for the loss sustained by the destruction of the automobile, if the railroad company paid less than the full damages caused by its negligence and obtained the release with knowledge that the insurance company had paid to Greger part of these damages under the insurance policy. Fire Ass'n of Philadelphia v. Wells, 84 N. J. Eq. 484, 94 A. 619, L. R. A. 1916A, 1280, Ann. Cas. 1917A, 1296; Ocean Accident & Guarantee Corporation v. Hooker Electrochemical Co., supra. There is evidence in this case from which it might be inferred that the railroad company did acquire such knowledge from an examination of Greger held at its

N. Y. 199, at page 205, 133 N. E. 444. It must in such case show that in fact the wrong has been committed and also the damages caused thereby. In order to prove damage, it must show that in fact it might have recovered against the railroad company as a wrongdoer. There is no such proof in this case. For all these reasons the judgment of the Appellate Division should be reversed, and the order of the Special Term affirmed, with costs in the Appellate Division and in this court.

CARDOZO, C. J., and POUND, CRANE, ANDREWS, KELLOGG, and O'BRIEN, JJ.,

concur.

Judgment accordingly.

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(246 N. Y. 169)

DIXON v. ROBBINS.

DIXON v. ROBBINS
(158 N.E.)

Court of Appeals of New York. July 20, 1927. Innkeepers 3-Lodging house, not furnishing food or maintaining public rooms and keeping no register, held not "hotel," within statute requiring fire escapes (General Business Law, §§ 200, 201, 205, 206).

Lodging house where no food is furnished, no public rooms maintained, keeping no register, and not held out to public as hotel except by sign on front that rooms were rented, held not "hotel," within General Business Law (Consol. Laws, c. 20), § 205, requiring fire escapes, in view of sections 200, 201, 206, and proprietor was therefore not liable for guest's injuries while endeavoring to escape from burning build

ing.

[Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Hotel.] Pound and Crane, JJ., dissenting.

63

night." The building contained about 35
rooms that could be used for lodgings. Some
of the rooms were rented for light house-
keeping, and the defendant did not take care
of the rooms so rented. The other rooms
were rented by the day, week, or night, or
The price was
even for part of a night.
always stated when the rooms were rented,
and in each room there was a sign: "Room
rent paid in advance." As long as any rooms
were vacant, the defendant would rent to any
person who applied. The defendant kept no
register. The building had no office or public
room. The rooms had no call bells or speak-
ing tubes. No meals were served to lodgers
in the building, and no other service provided
except in the care of the rooms. The plaintiff
had occupied his room for two or three
months before the fire, and by agreement paid
$3 a week for the room.

The Legislature did not in the statute define the word "hotel." We must presume that it

Appeal from Supreme Court, Appellate Di- intended that the word should be construed vision, Fourth Department. according to its common acceptance. In this Action by Charles M. Dixon against Lottie country the term "hotel" has largely superRobbins. Judgment of the Trial Term, en-seded the term "inn." All recognized lexicogtered on a verdict of a jury in favor of the raphers indicate that the words may be replaintiff, was affirmed by the Appellate Divi-garded as synonymous. In the construction of sion, Fourth Department (220 App. Div. 746, an earlier statute of a different nature, it has 221 N. Y. S. 814), and defendant appeals. Re- been said that: versed, and complaint dismissed. "The terms 'inn, tavern or hotel,' mentioned See, also, 218 App. Div. 813, 218 N. Y. S. in the statute, are used synonymously, to desig734. nate what is ordinarily and popularly known as an inn or tavern, or place for the entertainFloyd E. Whiteman, of Hornell, for appel- ment of travelers, and where all their wants

lant.

Edwin J. Carpenter, of Corning, for respondent.

can be supplied. The words 'inn or tavern' were so used in the prior corresponding enactments. 1 R. S. p. 679, § 10; Overseers of the Poor of Crown Point v. Warner, 3 Hill, 150. A

'hotel' is an inn or house for entertaining strangers or travelers. An 'inn' is a house for the lodging and entertainment of travelers." People v. Jones, 54 Barb. 311.

In construing a much later statute it has been said:

LEHMAN, J. In January, 1924, the plaintiff occupied a room in a building which the defendant owned and maintained. A fire occurred in the building, and the plaintiff sustained personal injuries of some severity while endeavoring to escape from the burning building. The building was not fireproof and was three stories in height. Concededly there were no fire escapes on the outside of the building, and no “rope or other better apa traveler is furnished, as a regular matter of pliance, to be used as a fire escape" had been placed in the room occupied by the plaintiff as a lodging room, as required by section 205 of the General Business Law (Consol. Laws, c. 20), if the building of the defendant was a "hotel," within the meaning of the statute.

The trial judge submitted to the jury, as a question of fact, the determination of whether or not the building was a hotel. The jury found a verdict in favor of the plaintiff. Upon the undisputed evidence it seems plain to us that the defendant's building is not a hotel. In front of the building there was a sign: "New Alpine. Rooms by the day, week, or

"The hotel, as it was first called, was the old inn, which is well defined as 'A house of entertainment for travelers,' or 'A house where

business, with food and lodging while on his journey.'' Waitt Construction Co. v. Chase, 197 App. Div. 327, 188 N. Y. S. 589.

In Cromwell v. Stephens (3 Abb. Prac. [N. S.] 26) the court in an elaborate opinion traced the derivation and history of the word "hotel" and reached a similar conclusion.

While none of these cases were reviewed by this court, there can be no doubt that they correctly hold that the word "hotel" is, in the common acceptance of the word, synonymous with "inn," especially an inn of the better class, and that the word "inn" at common law

meant a place where a traveler is furnished with both lodging and entertainment, including food. Multiplication of old decisions as to the meaning of the term "inn" would be useless. Beyond possibility of dispute, in times now past a place where travelers could obtain lodging only, without other entertainment, was not an inn. It is said, however, that with changing times, the terms "inn” or "hotel" have acquired a new significance, and that any place is a "hotel" where transient guests are received and lodged. In effect, the trial justice so charged the jury.

It may be that under changing conditions the common-law liability of an innkeeper may be extended by analogy and the compelling logic of particular facts to cases where at common law the person sought to be charged with that liability was not an innkeeper. The courts in some other jurisdictions have reached that conclusion. We need not analyze those decisions, nor determine now whether in similar circumstances we should follow them. They present a different question, arising under different circumstances, from that now under consideration.

Here the question is only whether the Legislature intended to include in the term "hotel" a building maintained as a lodging house where rooms are rented to transients or more permanent guests only after price is agreed upon, where no food is furnished, no public rooms are maintained, and no other entertainment or service is provided; which keeps no register, and which is not held out to the public as a hotel nor seeks the patronage of transients except by the sign on its front, "New Alpine. Rooms rented by day, week, or night." It may be that a building is a "hotel" within the meaning of the statute, though a person cannot receive there all the "entertainment" he might have obtained in other times at an "inn." We may not look solely to old definitions when we determine the meaning of a word which must be applied under changed conditions. Even under new conditions the term "hotel" is not applicable to a building, maintained as the evidence shows the defendant's building was maintained, with few, if any, of those characteristics which mark a "hotel" or "inn" as understood and defined both in legal decisions and common speech. The statute construed according to its letter and spirit does not apply to such a building. Other sections of the General Business Law show that the Legislature did not so intend (see sections 200, 201, and especially 206).

The judgment of the Appellate Division and that of the Trial Term should be reversed and the complaint dismissed, with costs in all

courts.

CARDOZO, C. J., and KELLOGG and O'BRIEN, JJ., concur.

POUND and CRANE, JJ., dissent.

ANDREWS, J., absent.

Judgment accordingly.

(246 N. Y. 174)

YOUSSOUPOFF v. WIDENER.

Court of Appeals of New York. July 20, 1927. 1. Appeal and error 1094(2)—In reviewing judgment in contest over contract, Court of Appeals considers only findings made at Special Term and affirmed by Appellate Division.

In reviewing judgment dismissing the complaint in an action claiming right of repurchase under a sales contract, Supreme Court of Appeals considers only findings made at Special Term and affirmed by the Appellate Division. 2. Sales 91-Finding that £100,000 was adequate price for pictures held not inconsistent with finding of previous offer of £150,000.

In contest over contract for sale of pictures. where plaintiff claimed he had received inadequate price, finding that £100,000 was reasonable price held not inconsistent with finding that experienced art dealer had previously offered £150,000.

3. Sales

35-Where seller of pictures understood contract and there was no duress, contract held enforceable whether or not buyer obtained exceptional bargain when seller was financially embarrassed.

Where seller of pictures was 38 years old. had the advice of an experienced business man understood, the meaning of the contract, and and of his own lawyer, and there was no duress, buyer held entitled to enforce terms of contract whether or not he obtained an exceptional bargain when the seller was financially hard pressed.

4. Chattel mortgages 6-Where parties intended loan on security, equity will disregard form of transaction and permit redemption, though borrower cannot comply with strict terms of contract.

Where parties to a transaction intended a loan or advance, a court of equity will disregard the form in which the transaction is clothed and permit the borrower to redeem the security, though he cannot comply with the strict terms chase" it. of the contract upon which he might "repur

5. Chattel mortgages 6-Where consideration is grossly inadequate for transfer in form a sale with repurchase provision, it is permissible inference that loan was intended.

consideration which is grossly inadequate, subWhere a transfer of property is made with ject to right of defeasance by repayment of amount received with interest, inference may

(158 N.E.)

ordinarily be drawn that parties intended only, 24), dismissing the complaint, plaintiff apa loan. peals. Affirmed.

6. Chattel mortgages 39-Evidence held to negative intention that contract in form a sale with repurchase option was intended to be loan on security.

Evidence that buyer of certain pictures was never willing to make a loan on the pictures held to negative the contention that, although

the contract was in form a sale with a limited repurchase option, it was intended by the parties to be a mere loan on security so that seller had right of redemption without complying with the strict terms of the contract.

7. Sales 55—Construction of sales contract made in England, selling pictures in England, held governed by English law and not law of Pennsylvania, where seller had right to exercise repurchase option.

Construction of a contract for the sale of Rembrandt pictures made in England, when the pictures were also in England, held governed by English law rather than by law of Pennsylvania, where the buyer resided and intended to take the pictures, and where the seller had the right to exercise a repurchase option.

8. Contracts 144-Where both parties execute contract, rule that instruments executed by one party are sometimes governed by law of maker's domicile held inapplicable.

Rule that the construction of instruments which are the act of one person only may sometimes be governed by the law of the maker's domicile is inapplicable, where an instrument is executed by both parties and is the contract of both parties.

9. Chattel mortgages 6-Instrument intended to be sales contract cannot be changed into mortgage by fictitious inference.

Court may not by fictitious inference change an instrument, which the parties intended should be a contract of sale, into a mortgage. 10. Sales 91-Conditions that seller might repurchase pictures only when in position to personally enjoy them, and for 10 years thereafter should dispose of them to no one except buyer, held strictly enforceable.

Conditions of contract for sale of Rembrandt pictures that the seller might repurchase the pictures within a limited time only if in a position to personally enjoy them, and that for 10 years thereafter he should dispose of them to no one except the buyer, held strictly enforceable, notwithstanding contention that buyer's "representation" of future intention was not equivalent to a condition or covenant.

Clarence J. Shearn, of New York City, for appellant.

Nathan L. Miller and H. Bartow Farr, both of New York City, for respondent.

LEHMAN, J. The plaintiff on August 12, 1921, signed a contract in the city of London

which reads as follows:

"Prince Youssoupoff has this day sold and delivered to Mr. Widener his two well-known Rembrandt portraits of a man and a woman which are illustrated and described in the Bode catalogue, for the price or sum of one hundred thousand pounds (£100,000), and has received the full purchase money. Title to the said pic

tures has passed to Mr. Widener and he accepts delivery of the same.

"Mr. Widener recognizes that Prince Youssoupoff would not have parted with these wonderful pictures for any consideration had it not been for the unhappy plight which has fallen upon him and his countrymen due to the dreadful revolution in Russia, and recognizing the very proper and deep-seated wish of Prince Youssoupoff to repossess himself of these pictures in case the present terrible conditions in Russia should readjust themselves within a reasonable time, Mr. Widener grants to Prince Youssoupoff the right and privilege to be exercised on or before January 1, 1924, and not thereafter, of repurchasing these pictures at the purchase price, one hundred thousand pounds (£100,000) plus eight per cent. (8%) interest from this date to the date of repurchase; the repurchase to be made in the city of Philadelphia and the pictures to be redelivered to Prince Youssoupoff upon payment of the full purchase money.

"This privilege is a purely personal one grantlove and appreciation of these wonderful piced to Prince Youssoupoff in recognition of his tures. It is not assignable nor will it inure to the benefit of his heirs, assigns, or representatives, and Prince Youssoupoff represents that this privilege of repurchase will be exercised only in case he finds himself in the position again to keep and personally enjoy these wonderful works of art. It is therefore agreed that if the repurchase should be made by Prince Youssoupoff, it will be made only under and subject to conditions to be at that time properly stipulated, that the title to the said pictures then acquired by Prince Youssoupoff will be subject to the right in Mr. Widener or his representatives to take back the pictures upon the payment to Prince Youssoupoff or his representatives of the gross sum which Prince Youssoupoff has paid to Mr. Widener in case Prince Youssoupoff or his representatives should at

Appeal from Supreme Court, Appellate Di- any time within 10 years after the date of the vision, First Department.

Action by Felix Youssoupoff against Joseph E. Widener. From a judgment of the Appellate Division (219 App. Div. 712, 219 N. Y. S. 942), which affirmed a judgment of the Special Term (126 Misc. Rep. 491, 215 N. Y. S. 158 N.E.-5

said repurchase wish to dispose of the same, against any party into whose possession the which right may be enforced by Mr. Widener pictures may have come in any manner in contravention to the reserved right of Mr. Widener. "Mr. Widener will, of course, take every precaution to preserve and protect these wonder

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