Saltzman v. Neuman

263 A.D. 832, 31 N.Y.S.2d 528, 1941 N.Y. App. Div. LEXIS 5187

Opinion

In an action to foreclose a chattel mortgage, the defenses and counterclaims are based on failure of consideration and fraud. Order of the Appellate Term, affirming a judgment of the Municipal Court, City of New York, in favor of defendants, and the judgment of the Municipal Court, reversed on the law, without costs, and judgment directed in favor of plaintiff for the amount demanded in the summons, with costs in the Municipal Court. The evidence establishes plaintiff’s theft of defendant Henry Neuman’s records, as well as his dishonesty in interfering with a customer with whom said defendant had an agreement. Plaintiff’s breach of the covenant amounted only to partial failure of consideration, and was not sufficient to abrogate the entire contract, under which said defendant had already received substantial benefits. The breach does not appear to have resulted in damage. Plaintiff’s theft of the said defendant’s records and his probable fraudulent use thereof in connection with his newly-formed partnership were not shown to have caused damage to said defendant, and the counterclaim to recover such damages was withdrawn on the trial. Lazansky, P. J., Carswell, Adel, Taylor and Close, JJ., concur.