formed Petterson that he had sold the mortgage. That was a definite notice to Petterson that the defendant could not perform his offered promise, and that a tender to the defendant, who was no longer the creditor, would be ineffective to satisfy the debt. "An offer to sell property may be withdrawn be fore acceptance without any formal notice to the person to whom the offer is made. It is sufficient if that person has actual knowledge that the person who made the offer has done some act inconsistent with the continuance of the offer, such as selling the property to a third person." Dickinson v. Dodds, 2 Ch. Div. 463, headnote. To the same effect is Coleman v. Applegarth, 68 Md. 21, 11 A. 284, 6 Am. St. Rep. 417. Thus it clearly appears that the defendant's offer was withdrawn before its acceptance had been tendered. It is unnecessary to determine, therefore, what the legal situation might have been had tender been made before withdrawal. It is the individual view of the writer that the same result would follow. This would be so, for the act requested to be performed was the completed act of payment, a thing incapable of performance, unless assented to by the person to be paid. Williston on Contracts, § 60b. Clearly an offering party has the right to name the precise act performance of which would convert his offer into a binding promise. Whatever the act may be until it is performed, the offer must be revocable. However, the supposed case is not before us for decision. We think that in this particular instance the offer of the defendant was withdrawn before it became a binding promise, and therefore that no contract was ever made for the breach of which the plaintiff may claim damages. The judgment of the Appellate Division and that of the Trial Term should be reversed, and the complaint dismissed, with costs in all courts. LEHMAN, J. (dissenting). The defendant's letter to Petterson constituted a promise on his part to accept payment at a discount of the mortgage he held, provided the mortgage is paid on or before May 31, 1924. Doubtless, by the terms of the promise itself, the defendant made payment of the mortgage by the plaintiff, before the stipulated time, a condition precedent to performance by the defendant of his promise to accept payment at a discount. If the condition precedent has not been performed, it is because the defendant made performance impossible by refusing to accept payment, when the plaintiff came with an offer of immediate performance. "It is a principle of fundamental justice that if a promisor is himself the cause of the failure of performance either of an obligation due him or of a condition upon which his own liability depends, he cannot take advantage of the failure." Williston on Contracts, § 677. The question in this case is not whether payment of the mortgage is a condition precedent to the performance of a promise made by the defendant, but, rather, whether, at the time the defendant refused the offer of payment, he had assumed any binding obligation, even though subject to, condition. The promise made by the defendant lacked consideration at the time it was made. Nevertheless, the promise was not made as a gift or mere gratuity to the plaintiff. It was made for the purpose of obtaining from the defendant something which the plaintiff desired. It constituted an offer which was to become binding whenever the plaintiff should give, in return for the defendant's promise, exactly the consideration which the defendant requested. Here the defendant requested no counter promise from the plaintiff. The consideration requested by the defendant for his promise to accept payment was, I agree, some act to be performed by the plaintiff. Until the act requested was performed, the defendant might undoubtedly revoke his offer. Our problem is to determine from the words of the letter, read in the light of surrounding circumstances, what act the defendant requested as consideration for his promise. The defendant undoubtedly made his offer as an inducement to the plaintiff to "pay" the mortgage before it was due. Therefore, it is said, that "the act requested to be performed was the completed act of payment, a thing incapable of performance, unless assented to by the person to be paid." In unmistakable terms the defendant agreed to accept payment, yet we are told that the defendant intended, and the plaintiff should have understood, that the act requested by the defendant, as consideration for his promise to accept payment, included performance by the defendant himself of the very promise for which the act was to be consideration. The defendant's promise was to become binding only when fully performed; and part of the consideration to be furnished by the plaintiff for the defendant's promise was to be the performance of that promise by the defendant. So construed, the defendant's promise or offer, though intended to induce action by the plaintiff, is but a snare and delusion. The plaintiff could not reasonably suppose that the defendant was asking him to procure the performance by the defendant of the very act which the defendant promised to do, yet we are told that, even after the plaintiff had I cannot believe that a result so extraordinary could have been intended when the defendant wrote the letter. "The thought behind the phrase proclaims itself misread when the outcome of the reading is injustice or absurdity." See opinion of Cardozo, C. J., in Surace v. Danna, 248 N. Y. 18, 161 N. E. 315. If the defendant intended to induce payment by the plaintiff and yet reserve the right to refuse payment when offered he should have used a phrase better calculated to express his meaning than the words: "I agree to accept." A promise to accept payment, by its very terms, must necessarily become binding, if at all, not later than when a present offer to pay is made. (161 Ν.Ε.) done all else which the defendant requested, (248 Ν. Υ. 93) the defendant's promise was still not binding DELINOUSHA et al. v. NATIONAL BISCUIT because the defendant chose not to perform. I recognize that in this case only an offer of payment, and not a formal tender of payment, was made before the defendant with drew his offer to accept payment. Even the plaintiff's part in the act of payment was then not technically complete. Even so, under a fair construction of the words of the letter, I think the plaintiff had done the act which the defendant requested as consideration for his promise. The plaintiff offered to pay, with present intention and ability to make that payment. A formal tender is seldom made in business transactions, except to lay the foundation for subsequent assertion in a court of justice of rights which spring from refusal of the tender. If the defendant acted in good faith in making his offer to accept payment, he could not well have intended to draw a distinction in the act requested of the plaintiff in return, between an offer which, unless refused, would ripen into completed payment, and a formal tender. Certainly the defendant could not have expected or intended that the plaintiff would make a formal tender of payment without first stating that he had come to make payment. We should not read into the language of the defendant's offer a meaning which would prerent enforcement of the defendant's promise after it had been accepted by the plaintiff in the very way which the defendant must have intended it should be accepted, if he acted in good faith. The judgment should be affirmed. CARDOZO, C. J., and POUND, CRANE, and O'BRIEN, JJ., concur with KELLOGG, J. LEHMAN, J., dissents in opinion, in which ANDREWS, J., concurs. Judgments reversed, etc. CO. Court of Appeals of New York. May 1, 1928. 1. Master and servant 348-Workmen's Compensation Law is construed liberally (Workmen's Compensation Law). Workmen's Compensation Law (Consol. Laws, c. 67) is to be construed liberally, and death benefits are allowed if injury results naturally and unavoidably from disease, and disease causes death. 2. Master and servant 373-Death by suicide, resulting from brain derangement or insanity, which in turn is produced by industrial accident, is compensable; "proximate and direct result" (Workmen's Compensation Law, §10). Where industrial injury causes insanity, and insanity directly causes suicide, death is "proximate and direct result" of the accident, within the meaning of the Workmen's Compensation Law (Consol. Laws, c. 67), § 10, and death benefits are recoverable. [Ed. Note. For other definitions, see Words and Phrases, Second Series, Proximate Result.] Appeal from Supreme Court, Appellate Division, Third Department. Proceedings under the Workmen's Compensation Act by Demetras Delinousha and others for death benefits, opposed by the National Biscuit Company. An award of the State Industrial Board in claimant's favor was affirmed by the Appellate Division (221 App. Div. 827, 224 Ν. Y. S. 785), and the employer appeals. Order of Appellate Division affirmed. Charles A. Vilas, of New York City, for appellant. Albert Ottinger, Atty. Gen. (E. C. Aiken, Deputy Atty. Gen., of counsel), for respond ents. ANDREWS, J. Concededly, if an injury causes insanity, which in turn causes suicide, death benefits may be awarded under the pro visions of section 10 of the Workmen's Compensation Law (Consol. Laws, c. 67). Here the finding is to the effect that the injury suffered by the deceased caused him to "develop and suffer from a psychosis," which caused him to commit suicide, "his death being naturally and unavoidably the result of the injuries which he sustained," and that it "resulted from an uncontrollable impulse and without conscious volition to produce death." As there is some evidence to justify this finding, we would content ourselves with affirming without opinion were it not for the test as to the meaning of the word "insanity" to be applied in such cases, as stated by the Appellate Division upon an earlier appeal. It may be said safely that insanity is a symptom of some functional derangement of tissues of the brain. As this derangement is more or less deep seated, so the resulting symptoms are more or less profound. The legal effect differs under varying circumstances. Insanity for one purpose may not be insanity for another. The defendant is guilty of crime, if he knows the nature and quality of the act he commits, and knows that it is wrong. A testator may make a will if he has capacity to comprehend the condition of his property, his relation to those who would, or should, or might, be the natural objects of his bounty, and the scope and bearing of its provisions. A contract may be avoided only if a party is so affected as to be unable to see things in their true relations and to form correct conclusions in regard thereto. A policy of insurance, excepting death by suicide, may be enforced, if the insured kills himself while insane. Here, however, there is no agreement as to the precise meaning of the wordthe extent of the mental deficiency which it connotes. In some courts it means inability to recognize the physical nature of the act. Cooper v. Massachusetts Mut. Life Ins. Co., 102 Mass. 227, 3 Am. Rep. 451. In others, unconsciousness that the act will cause death, or the presence of an irresistible insane impulse. Van Zandt v. Mutual Ben. Life Ins. Co., 55 N. Y. 169, 14 Am. Rep. 215. Still else where such an impairment of reason that, while the act is intentional and voluntary, the insured still does not understand its moral quality and its general nature or effect, or where an irresistible impulse is present. Connecticut Mut. Life Ins. Co. v. Akens, 150 U. S. 468, 14 S. Ct. 155, 37 L. Ed. 1148. And again the absence of criminal intent of an evil motive. Eastabrook v. Union Mut. Life Ins. Co., 54 Me. 224, 89 Am. Dec. 743. The New York rule, a compromise between the two extreme views, and formulated in the Van Zandt Case, 55 N. Y. 169, 14 Am. Rep. 215, has been followed here. Newton v. Mu tual Ben. Life Ins. Co., 76 N. Y. 426, 32 Am. Rep. 335; Penfold v. Universal Life Ins. Co., 85 N. Y. 317,39 Am. Rep. 660; Meacham v. New York State Mut. Ben. Ass'n, 120 N. Y. 237, 24 Ν. E. 283. In Newton v. Mutual Ben. Life Ins. Co., Judge Rapallo restates it. If, he says, the insured "acted under the control of an insane impulse caused by disease, and derangement of his intellect, which de prived him of the capacity of governing his own conduct in accordance with reason," the suicide is not a voluntary act. [1,2] While helpful, the decisions as to insurance policies are not strictly analogous to claims arising under the Workmen's Compensation Law. The courts there are attempting to decide the meaning of an ambiguous clause in a contract. What was the intent of the parties. But here we deal with a statute intended to redress the incidence of that economic loss inevitable in industry. It is to be construed liberally. Death benefits are allowed if the injury results naturally and unavoidably in disease, and the disease causes death. This is so if the injury causes insanity from gangrenous poisoning or otherwise, and the insanity directly causes suicide; in other words, if the suicide is not the result of discouragement, of melancholy, of other sane conditions, but of brain derangement. If that is the cause, an award may be made. Death is then the proximate and direct result of the accident within the meaning of the statute. The order appealed from should be affirmed, with costs. CARDOZO, C. J., and POUND, CRANE, LEHMAN, KELLOGG, and O'BRIEN, JJ., concur. Order affirmed. (248 Ν. Υ. 97) PEOPLE ex rel. GRAND TRUNK RY. CO. OF CANADA. v. GILCHRIST et al. Court of Appeals of New York. May 1, 1928. I. Taxation 144-Right derived from state to operate railroad above navigable stream is taxable as special franchise (Tax Law). Right derived from state to operate railroad above a navigable stream is a special franchise, which may be taxed under Tax Law (Consol. Laws, c. 60), since in such case state grants special privilege which is not enjoyed by all the people of the state. 2. Railroads 33(1)-Railroad corporation's right to exercise corporate powers depends upon state's permission or authority. Railroad corporation may not exercise its corporate powers within state except by permission or authority granted by state. 3. Taxation 144-Where bridge companies received permission from state to operate bridge, railroad acquiring from bridge companies right to place tracks thereon could operate with only general franchise. Where railroad acquired from bridge companies right or privilege to place its tracks upon bridge, and bridge companies in turn had secured permission from state to construct and operate bridge over navigable river, railroad's operation was legal without further grant or authority except permission to exercise its general corporate powers. (161 Ν.Ε.) 4. Taxation117-No special franchise within tax law is involved, where corporate exercise of franchise in public place is not based upon state's authority (Tax Law, § 2). If exercise of corporate franchise in public place is not based upon authority granted by the state, no special franchise within definition of Tax Law (Consol. Laws, c. 60), § 2, is in volved. 5. Taxation 117-As regards taxation, right of bridge company to construct bridge over navigable river and to contract for operation of railroad over it is special privilege; "spe cial franchise." Right of bridge company to construct bridge over navigable river and to contract for its own benefit with railroad company for operation of railroad across bridge is a special privilege or right granted by the state, even though not taxable as "special franchise" because not within definition of Tax Law (Consol. Laws, c. 60) § 2. [Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Special Franchise.] 6. Taxation 144-Railroad's exercise of right to operate trains over bridge under contract with bridge companies, authorized by state to construct and operate bridges, held not taxable as "special franchise" (Laws 1846, c. 104; Laws 1853, c. 622; Tax Law, § 2). Where state, under Laws 1846, c. 104, and Laws 1853, c. 622, gave to bridge company the authority to construct and operate bridge over navigable river, railroad operating its train over bridge with consent of bridge companies and under general authority of state to exercise its corporate privileges therein did not enjoy special franchise from state within definition of Tax Law (Consol. Laws, c. 60) § 2, and railroad was therefore not subject to special franchise tax assessment. Crane, Andrews, and O'Brien, JJ., dissenting. Appeal from Supreme Court, Appellate Division, Fourth Department. Proceeding by the People, on the relation of the Grand Trunk Railway Company of Canada, against John F. Gilchrist and others, constituting the State Tax Commission. A judgment of the Special Term, made on the report of a referee in certiorari proceedings, vacating a special franchise tax assessment, was reversed on the law and facts by the Appellate Division (221 App. Div. 19, 221 N. Y. S. 613), and the assessment reinstated, and relator appeals. Judgment of the Appellate Division reversed, and that of the Special Term affirmed. S. Fay Carr, of Buffalo, for appellant. Albert Ottinger, Atty. Gen. (Alexander L. Saul, of Syracuse, and Frederic Merriman, of Madrid, of counsel), for respondents. 161 Ν.Ε.-28 LEHMAN, J. The relator, Grand Trunk Railway Company of Canada, is a railroad corporation organized under the laws of the Dominion of Canada. It maintains and operates a railroad which crosses the Niagara river upon a bridge which was constructed by Niagara Falls Suspension Bridge Company, a Canadian corporation, and Niagara Falls International Bridge Company, a New York corporation. The Niagara river is a navigable stream forming part of the boundary between the United States and Canada. The state of New York might grant or withhold the privilege or right to construct, maintain, and operate a bridge or other crossing above a navigable stream within its own territory. The right to construct a bridge across a navigable boundary stream could be granted only by the action of both abutting sovereignties. The state of New York, by the law which created the Niagara Falls International Bridge Company (Laws of 1846, c. 104), granted to that corporation the right to construct and operate a bridge across the Niagara river. In association with the Canadian corporation, which had received similar powers in its domicile, Niagara Falls International Bridge Company constructed the bridge. The upper floor of the bridge was designed to pass railroad trains with locomotives, and the lower floor was designed for carriages, for pedestrians, and for animals. The two bridge companies had no power to maintain or operate a railroad across the bridge or that part of it lying within the state of New York; but by chapter 622 of the Laws of 1853 the Niagara Falls International Bridge Company was given full power and authority, by itself or in union with the Niagara Falls Suspension Bridge Company of Canada West, to enter into any contract or agreement with any individual, railroad company, or railroad companies, with reference to the terms of crossing locomotives and cars, passengers, and freight over said railroad bridge, and the construction, repairs, insurance, and maintenance of the same, upon such terms and conditions, and for such time or times as may be agreed upon by and between the parties. Accordingly in October, 1853, the two bridge companies jointly agreed with the Great Western Railway Company in Canada West, the predecessor in title and interest of the relator, to lease to said company the railroad floor and structure. Since that time the bridge has from time to time been altered and reconstructed, and other agreements have been made between the bridge companies and the relator or its predecessor in title. The relator still occupies the railroad floor of the bridge under lease from the bridge companies. Under the terms of the contract it is provided that the "Grand Trunk shall be entitled to all rails, guard rails, ties, tie plates, spacers, expansion joints, tracks, and other track equipment now or hereafter placed upon the upper floor of the said bridge and approaches, and the same shall remain the property of the Grand Trunk." The relator operates its railroad within the state of New York from a point on the bridge, above the boundary line of the state, to the Lehigh Valley railroad passenger station, located about 300 yards easterly from the easterly end of the bridge structure. A special franchise tax assessment, which the relator now attacks, has been placed upon the "franchise right or permission of the relator to construct, maintain, or operate its railroad above the Niagara river." [1] A right derived from the state to operate a railroad above a navigable stream is unquestionably a special franchise. The state in such case has granted a special privilege in a highway or public place which is not enjoyed by all the people of the state. Such a right, permission, or privilege may be taxed. Tax Law (Cons. Laws, c. 60), § 2; People ex rel. Harlem River & P. C. R. R. Co. v. State Board of Tax Commissioners, 215 N. Y. 507, 109 N. E. 569, L. R. A. 1916B, 1222; People ex rel. Metropolitan Street Railway Co. v. State Board of Tax Commissioners, 174 N. Y. 417, 67 N. E. 69, 63 L. R. A. 884, 105 Am. St. Rep. 674. The relator in this case operates its railroad on a bridge over the Niagara river, not under a permission or authority granted by the state to it, but under a right or permission granted to it by the bridge companies acting under authority derived from the state. The question is whether right or permission so derived is a special franchise within the meaning of the Tax Law. [2, 3] A railroad corporation may not exercise its corporate powers within this state, except by permission or authority of the state. The lease by the bridge companies to the relator of the railroad floor of the bridge could not confer upon the relator any corporate power to operate its railroad within the state. It is said that the railroad company may not claim that its right to operate a railroad on the bridge is not derived from permission of the state, since without such permission its operation would be illegal. That argument disregards the distinction between a general franchise and a special franchise. "The general franchise of a corporation is its right to live and do business by the exercise of the corporate powers granted by the state. When a right of way over a public street is granted to such corporation, with leave to construct and operate a street railroad thereon, the privilege is known as a special franchise, or the right to do something which, ** except for the grant, would be a trespass." People ex rel. Harlem River & P. C. R. R. Co. v. Board of Tax Commissioners, 215 N. Y. 507, 511, 109 Ν. E. 569, 571 (L. R. A. 1916B, 1222). A mere permission of the state to the relator to operate its railroad within the state in itself confers upon the relator no special right or privilege to encroach upon the rights of the public in a highway or public place. At most it is equivalent to a general franchise. Without lease or permission from the bridge companies, the relator's operation of its railroad on the bridge over the Niagara river would constitute a trespass even though the state had expressly conferred a corporate power upon the relator to construct a railroad across public places and waters. After the relator acquired from the bridge companies the right or privilege to place its tracks upon the bridge, the operation by the relator was legal without further grant or authority from the state, except permission to exercise its general corporate powers within the state. Unless we find, therefore, that the permission or privilege derived from the contract made with the bridge companies constitutes a spe cial franchise within the definition of the Tax Law, the assessment must be set aside. [4, 5] If the exercise by the relator of its corporate franchises in a public place is not based upon authority granted by the state, if it does not rest upon public favor rather than private right, the relator enjoys no special franchise. People ex rel. N. Y. Cent. & H. R. R. Co. v. Woodbury, 203 N. Y. 167, 96 Ν. Ε. 431; People ex rel. New York Cent. & H. R. R. Co. v. Priest, 206 N. Y. 274, 99 Ν. Ε. 547; People ex rel. Hudson & M. R. Co. v. State Board of Tax Comrs., 203 N. Y. 119, 96 N. E. 435; People ex rel. Long Island R. Co. v. State Board of Tax Com'rs, 148 App. Div. 751, 133 N. Y. S. 348, aff'd on opinion below, 207 N. Y. 683, 101 Ν. Ε. 1117. The state granted to the Niagara Falls International Bridge Company the authority to construct a bridge across the Niagara river and to enter into a contract with a railroad company or companies for the operation of a railroad. The bridge company was not authorized to operate a railroad across its bridge, but it was given the right to grant such privilege to another for its own profit. The right of the bridge company to construct a bridge over a navigable river and to contract for its own profit with a railroad company for the operation of a railroad across the bridge, is a special privilege or right granted by the state to do an act on public property which would otherwise be illegal, even though it may be that the right or privilege granted to the bridge company is not taxable at the present time as a special franchise because it does not fall strictly within the legislative definition of section 2 |