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Second Department, May, 1921.

[Vol. 197

Tested in this way, could the matter complained of in the case at bar by any possibility be relevant under any circumstances at some stage of the proceedings in the action?

Defendant urges that the alleged libel was pertinent and material in answer to the allegations contained in the 8th paragraph of the complaint, quoted above, in which plaintiff alleged ownership of the bonds. Ordinarily, it would hardly seem that in an action seeking the recovery of certain shares of stock the ownership of bonds not the subject of the action, were relevant or pertinent, nor that plaintiff's allegations in the complaint of such ownership would make it pertinent or material. But a close analysis of the complaint shows that there was something more involved in the former action than the mere ownership of the stock; something more than the plaintiff's right to its recovery as property of value. If that were all, probably plaintiff's remedy at law for damages would have been adequate. The ownership of the stock, however, was a mere incident to a far greater right which plaintiff was seeking to attain; that is, the control and management of the corporation. The suit was, therefore, brought in equity to compel specific performance of defendant's agreement to return the stock upon the payment of the indebtedness, and in such an action it was essential that plaintiff show that he would suffer irreparable damage unless this relief were afforded him and that an action at law for the value of the stock as damages would be utterly inadequate, because he would lose the control and management of the corporation, a right so valuable that in comparison the value of the stock became insignificant. Seeking such relief in equity every fact which could possibly be alleged in his complaint, showing the necessity and value to him of this right of control, was of importance to establish that the right was a valuable one not to be measured by the mere value of the stock as damages, and that unless return of the stock were compelled in equity, he could secure no adequate relief. This, it seems to me, was clearly the purpose of alleging in his complaint, not simply the agreement with defendant and plaintiff's right to the stock upon payment of the indebtedness, but also facts showing the importance and value to him of the control of the corporation, and that defendant's refusal

App. Div. 551]

Second Department, May, 1921.

to return the stock threatened plaintiff with the loss of such control. He, therefore, alleged in substance that he founded the corporation, was its president and treasurer, and had had its sole control and management; that its future would be greatly jeopardized if such management and control were interfered with; that he organized and carried on the business, owned nearly one-third of the capital stock, and that of the $76,000 in bonds issued and outstanding he owned $50,000, and that of the remaining indebtedness of the corporation, aggregating $55,000, he was the indorser and liable on its notes. It seems to me that viewed in this light the allegations contained in plaintiff's complaint were more than mere surplusage; they were relevant and material to support his right to specific performance of defendant's agreement in equity. I do not think, therefore, that it can be said that the matter alleged by defendant in his third defense and counterclaim, which controverted plaintiff's ownership of the bonds, was not relevant or pertinent. It is true that defendant might have raised the question of ownership by a simple denial, but it seems to me that he might go further and set up in addition facts tending to disprove plaintiff's ownership, and that such acts would be pertinent and material.

I think also there is another aspect in which the alleged libel might have been material and pertinent. Plaintiff, among other things, prayed for an injunction restraining the defendant from voting the stock and the corporation from holding any meeting of its stockholders until plaintiff had secured the stock. Upon a motion for a preliminary injunction can it be said that the alleged libelous matter could not have been interposed by the defendant in answering affidavits seeking to put in issue plaintiff's right to control and manage the corporation? Clearly it seems to me that upon such a motion it would have been both material and pertinent.

Other incidents might be noted showing the relevancy and pertinency of the alleged libel to the issues in the former motion, but I think sufficient already appears to bring it within the rule as to absolute privilege.

The motion for judgment on the pleadings is, therefore, granted.

APP. DIV.- VOL. CXCVII. 36

First Department, July, 1921.

[Vol. 197

THE PEOPLE OF THE STATE OF NEW YORK ex rel. AGINS & KLUGERMAN, INC., Respondent, v. THE BOARD OF HEALTH OF THE DEPARTMENT OF HEALTH OF THE CITY OF NEW YORK, Appellant.

First Department, July 1, 1921.

Municipal corporations - city of New York alternative writ of mandamus to compel vacation of order of board of health revoking relator's permit to sell milk-powers of board administrative — writ will not issue where there is no abuse of discretionary power. An alternative writ of mandamus will not issue to require the board of health of the city of New York to vacate an order which revoked the relator's permit to sell milk and milk products, where it appears that the relator's record of violations of the Sanitary Code were numerous, and that the action of the board was not capricious, unreasonable or arbitrary. The powers of the members of the board of health being adminstrative merely, they can issue or revoke permits to sell milk in the exercise of their best judgment, and their action is not subject to review unless it is arbitrary, tyrannical or unreasonable, in which case the remedy is mandamus.

APPEAL by the defendant, The Board of Health of the Department of Health of the City of New York, from so much of an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 21st day of May, 1921, as directs the issuance of an alternative writ of mandamus requiring it to vacate, set aside and revoke an order of said Board of Health which revoked the permit of the relator theretofore issued by it in 1920 to sell milk and milk products in the city of New York.

Willard S. Allen of counsel [George P. Nicholson, John F. O'Brien and Russell Lord Tarbox with him on the brief; John P. O'Brien, Corporation Counsel, attorney], for the appellant.

Benajmin F. Schreiber of counsel [Alfred Rathheim with him on the brief; Schreiber & Collins, attorneys], for the respondent. GREENBAUM, J.:

Defendant's authority to issue milk permits is conferred by section 155 of the Sanitary Code which in part reads as follows: "No milk, skimmed milk or cream, condensed or

App. Div. 562]
First Department, July, 1921.

concentrated milk, condensed skimmed milk or modified
milk shall be held, kept, offered for sale, sold or delivered
in the City of New York without a permit issued therefor
by the Board of Health or otherwise than in accordance
with the terms of said permit and with the regulations of
said Board. * * * ""
(See Code of Ordinances of City of

New York, chap. 20, § 155.)

The practically undisputed facts appearing from the papers before us are as follows: The previous record of Agins, relator's president, is that on September 15, 1916, he was fined fifteen dollars in the Court of Special Sessions for violation of section 152 of the Sanitary Code, for offering for sale adulterated cream; that on or about February 2, 1917, he was fined five dollars in the Municipal Term for violation of section 331, subdivision b, of the Sanitary Code for having in his possession two pounds of unwholesome eggs; that on or about May 1, 1918, he was fined ten dollars in the Municipal Term for violation of section 152 of the Sanitary Code, for offering for sale cream which was found to be below the standard required by law, and that on or about October 25, 1918, he was fined fifty dollars in the Municipal Term for violation of section 152 of the Sanitary Code, for offering for sale cream below the legal standard.

In or about the month of January, 1920, Agins, together with others who were theretofore engaged in the sour cream business, organized the relator corporation under the name of Agins & Klugerman, Inc.

On June 23, 1920, a permit was issued to the relator upon its assurance that it would comply with the provisions of the Sanitary Code.

In July, 1920, relator's president was summoned to the office of the acting director of the bureau of food and drugs of the department of health of the city of New York and notified that the bureau had found at different times five samples of cream offered for sale by the relator which were adulterated with foreign fat or were otherwise below the standard, and he was then warned that unless that practice was discontinued immediately it would be subjected not only to prosecution, but also to revocation of the permit issued to the relator. These five cases subsequently came on for trial;

First Department, July, 1921.

[Vol. 197 in one the relator was convicted on September 17, 1920, in the Court of Special Sessions for violation of section 152 of the Sanitary Code in selling cream below the standard and sentence suspended. In the other four cases it was convicted on January 13, 1921, in the Court of Special Sessions for violation of section 152 of the Sanitary Code in offering for sale cream containing a foreign fat and was fined twenty-five dollars for each of the four offenses.

Despite the warning of the acting director of the department, samples of cream below the standard were found in the possession of the relator on five other occasions.

On February 9, 1921, the acting director recommended the revocation of the permit issued to the relator.

On March 11, 1921, the relator was convicted on three of the charges in the Municipal Term for violation of section 152 of the Sanitary Code and was fined $150 for each of the three offenses.

On March 24, 1921, the board of health revoked the relator's permit. The remaining charges were then pending trial.

The defendant is charged with duties of the highest importance to the health of the community and the exercise of the power vested in it by law to revoke licenses will not be disturbed by the court excepting where its action is arbitrary, tyrannical or unreasonable.

In People ex rel. Lodes v. Department of Health (189 N. Y. 187) the court in the prevailing opinion said: "The powers of the members of the board of health being administrative merely, they can issue or revoke permits to sell milk in the exercise of their best judgment, upon or without notice, based upon such information as they may obtain through their own agencies, and their action is not subject to review either by appeal or by certiorari. (Child v. Bemus, 17 R. I. 230; State ex rel. Cont. Ins. Co. v. Doyle, 40 Wis. 220; Wallace v. Mayor, etc., of Reno, 63 L. R. A. 337.) If, however, their action is arbitrary, tyrannical and unreasonable, or is based upon false information, the relator may have a remedy through mandamus to right the wrong which he has suffered."

From the record before us it conclusively appears that the relator does not come into court with clean hands. Moreover, there is not the semblance of a fact in relator's petition which

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