Levy v. Popper

This is an action for an accounting .brought by a customer of the defendants, who are stockbrokers. They separately demurred to the complaint, the demurrers were overruled, and they appeal from the interlocutory judgment entered to that effect. " . .

The demurrers were placed upon five'grounds, four of which, in our opinion, were properly disposed of by the learned judge at Special Term, and need not be further Considered. The remaining objection, however, that there is a defect of parties, we think is well taken, and the demurrers should have been sustained on that ground. '

The complaint alleges that in the month of October, 1900, the plaintiff and one Jacob Hirsch opened an account, under the name of Levy & Hirsch, with the firm of Popper & Stern, as stockbrokers, and thereafter had various and numerous transactions with' them; that about the 1st of July, 1903, the plaintiff and saifd Hirsch “ directed the firm of Popper & Sternbach,” successors to . 'the former firm, “to*divide the account of Levy &' Hirsch and to credit to the account of thé plaintiff one-half of the stocks,” etc., “ on hand to the credit of the account of Levy & Hirsch and to charge ” the plaintiff’s individual account with one-half of the indebtedness of the Levy & Hirsch account.”

/It iso nowhere alleged',, however, that the defendants made . the division as directed, or that they consented tó make any division of *459the Levy & Hirsch account, or that they consented to charge one-half the indebtedness thereof to the plaintiff; nor does it appear that they were under any duty to follow the instructions to do so. In this condition of the pleading we think Hirsch was a necessary party to the action. The .defendants having certain relations with the plaintiff and Hirsch jointly, were under no obligation to cancel the joint liability of those two individuals for the entire indebtedness of the account and to accept as a substitute a separate liability of each party for one-lialf of that indebtedness. Hor were they under any obligation to sever the joint relation or to recognize either Levy or Hirsch as the sole separate owner of half the account. If it/had appeared, in addition to the request of the plaintiff and Hirsch to sever the account, that the defendants had complied with that request or direction, or that they had in fact severed the account or consented to sever it, then an accounting between the plaintiff and the defendants could have been had without the presence of Hirsch. In the absence, however, of any of these essential allegations, we think that Hirsch was not only, a proper but a necessary party, and' the failure to join him either as plaintiff or defendant renders the complaint vulnerable - to attack by demurrer on the ground that there is a defect- of parties.

It follows accordingly that the judgment overruling the demurrers should be reversed, with costs, and the demurrers sustained upon this ground, with leave to the plaintiff to amend the complaint upon payment of the costs in this court and in the. court below.

Van Brunt, "P. J., Ingraham and Laughlin,- JJ.,‘concurred; Patterson,. J., dissented.

Judgment reversed, with costs, and. demurrers sustained, with costs, with leave to plaintiff to amend on payment of costs in this court and in the court below.