Case ID: ny-super-ct_47/html/0242-01.html
Source: Caselaw Access Project
Author: {"author": "By the Court.—Sedgwick, Ch. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

DAVID HENRY JONES, Respondent, v. THE MAYOR, ALDERMEN AND COMMONALTY OF NEW YORK, Appellant.
    I. Statutes.
    1. Construction of. Act of 1877, chap. 478, relative to claims for labor, &c., on armories and drill rooms.
    
      {a) Assignment of claim, presentation of, clause calling for. A clause in the act requiring any person holding an assignment of a claim, to present the same before a commission created by the act,
    
      applies only
    
    to a case where the whole claim has been assigned.
    II. Assignment of pact of a claim.
    
    1. Carries wha-t.
    
      (a) Equitably, carries a pro tanto portion of such sum as the party against whom the claim is made, is legally bound to pay in respect of the claim.
    
      2. Parties to an action to recover the assigned part.
    («) Where the party against whom the claim exists pays to the assignor, after notice of the assignment, the whole amount of the claim, the assignor is not a necessary party to an action brought by the assignee to recover the assigned portion.
    3. Acknowledgment.
    
      (a) Not necessary to protect the assignee against a payment to the assignor, or to enable the assignee to recover.
    Before Sedgwick, Ch. J., and Trdax, J.
    
      Decided April 4, 1881.
    Appeal from judgment in favor of plaintiff, entered upon a decision at special term.
    One Stephen Knapp furnished material and did certain work to an armory in this city to the value of more than $9,000. He claimed that this was a valid indebtedness on the part of the defendant to him, and brought an action therefor. During the pendency of the action, Knapp made an assignment to the plaintiff" in the following form: “Whereas, I have certain claims against the county of New York for fitting up armories and drill rooms, amounting to about fourteen, thousand dollars. I do hereby sell, assign, transfer and set over to David Henry Jones the sum of four-hundred dollars, for wages due him as carpenter ; the-above claims having been audited by the board of supervisors, and are now in the office of the comptroller.”
    “Signed February 21, 1874.
    Stephen H. Knapp.”
    The plaintiff filed this assignment in the office of the comptroller of the defendant. Knapp was defeated in his action, on the ground that the regiment for which the armory was fitted up, had failed to comply with certain requirements of the Military Code. Knapp died in 1874. In 1877 the legislature passed an act (L. 1877, c. 473), which enacted among other things that “ whenever any goods, &c., have been furnished or labor performed in fitting up, &c., any armory, &c., it shall be lawful for the comptroller of the city of New York to, and he shall, and the mayor, &c., are hereby made liable to pay for such goods, &c., such compensation as shall be awarded by a commission consisting of, &c. The executrix of Knapp presented the claim of Knapp to the commission, and it awarded her the sum of $9,281. This was compensation for all the work done by the deceased. The plaintiff did not present his claim as assignee to the commission. After the award was made, and before it was paid, the city received further notice that the plaintiff claimed to be paid out of the award the amount of his assignment. At one time the city reserved an amount to meet the assignment, but after-wards paid it out to third parties. The court below found and ordered judgment, that defendant was liable to plaintiff in the amount of the amount of the assignment.
    
      William G.' Whitney, counsel to the corporation, for appellant:
    I. Upon the facts presented upon the trial of this action, the respondent was not entitled to any judgment whatsoever in his favor. 1. The proof shows that the assignment in question was never acknowledged, nor was any proceeding ever taken by the respondent to enforce the same until after the appellants had parted with the money in their hands. 2. By •chapter 473 of the Laws of 1877, any person holding an assignment of any claim of this character, either for ■the whole or any portion thereof, was required to present bis assignment before the said commission. This was not done. The award was made directly to the ■executrix, and she, as representing the estate, was, pursuant to the act of the legislature, entitled to receive all this money without reference to any claims, whether in judgment or not, and could be only answerable to these claims when presented in the proper court. 3. The instrument of assignment was not drawn •on any fund, because Knapp, the assignor, had then no claim ; and no funds were then in existence, nor did any afterwards come into existence on which it could attach or become operative. The instrument could have created no lien, as an existing fund was-necessary to have done so (Attorney-General v. Continental, 71 N. Y. 325). The city did not ever have the money in its possession,- nor could it pay it out except as directed by the act and the terms of award and Mrs. Knapp, as executrix, as by law required, procured the moneys in an installment in July, and by final payment again in November, 1878. The-plaintiff, therefore, was not to be protected for his own tardiness. The money in the hands of the executrix was practically in possession of the court, which could have secured the plaintiff’s claim in a proper proceeding, had he pursued her therefor. The city had parted with the fund before suit; and the executrix was not made a party defendant.
    II. The executrix was not made a party to this action, no opportunity was given to her to contest this claim, and if the judgment in the present action should be allowed to stand, the effect would be that possibly the respondent would be paid a claim which has no foundation in face.
    
      FranJcenheim & Rosenblatt, attorneys, and of counsel, for respondent.
    I. The instrument executed by Stephen H. Knapp, and filed with the comptroller, operated as an' equitable assignment to the extent of $400, of whatever sums might eventually be paid to Knapp or his representatives on account of his claim for fitting up armories and drill rooms. (1) No particular form is necessary to constitute an equitable assignment. Any order, writing or act which makes an appropriation of a fund, amounts to an equitable assignment of that fund (2 Story Equity, § 1047; Munger v. Shannon, 61 N. Y. 251). (2) Far less specific orders have been upheld as equitable assignments by the court of appeals (Field v. Mayor, &c., 6 N. Y. 179; Parker v. City of Syracuse, 31 Id. 376; Hall v. City of Buffalo, 1 Keyes, 93; Morton v. Naylor, 1 Hill, 583).
    II. It is no defense that payment of these “claims ” could not be enforced at the time of the assignment. The legislature, by chapter 473 of the Laws of 1877, having thereafter provided a mode of ascertaining these “claims,” and of paying the amount to be awarded thereon, the lien of Jones under the assignment attached to the award the moment it was made. Courts of equity will support assignments, not only of choses in action, but of contingent interests and expectations, and of things which have no present actual existencó,' but rest in possibility only, provided the agreements are fairly entered into, and it would not be against public policy to uphold them (followed in Hall v. City of Buffalo, 1 Keyes, 193 ; Stover v. Eyclesheimer, 3 Keyes, 620 ; Field v. Mayor, 12 N. Y. 179 ; Mitchell v. Winslow, 2 Story, 630). The same principles have been applied to mortgages of future acquired property (McCaffrey v. Woodin, 65 N. Y. 459; Holroyd v. Marshall, 10 H. L. Cas. 191; Williams v. Winsor, 17 Alb. L. J. 359 ; Wyatt v. Watkins, 16 Id. 205 ; Williams v. Briggs, Id. 387 ; Laning v. Tompkins, 45 Barb. 308).
    III. The award to Jane Knapp, executrix, under the statute (L. 1877, c. 473, p. 552), cannot be construed as a gift or gratuity to her. The object of the statute was to provide equitable compensation for services performed and materials furnished for which no recovery could be had at law. The executrix of Knapp could not claim to hold the award free from the equitable liens of his assignees (Munsell v. Lewis, 2 Den. 224 ; Bank of Auburn v. Roberts, 44 N. Y. 192; Spears v. Mayor, 10 Hun, 160).
    IV. Plaintiff’s equities against the moneys awarded to the Knapp estate could not be cut off by any proceedings under the act to which he was not a party. As between Knapp and the plaintiff the award, being based on the identical “claims” specified in plaintiff’s assignment, became subject to the equitable lien thereof, and if the act operated to divest plaintiff of this lien, it was to this extent unconstitutional. (1) Section 4. of the act (L. 1877, c. 473, p. 552), provides that the commission shall examine and inquire as to any assignment of the claim, and that payment of the amount awarded shall be made directly to the claimant or his jjersonal representatives, only where the claim has not been sold and assigned. It was evidently the intention of the legislature to preserve the rights of assignees. To put any other construction on the statute would be to impute a most unjust motive to the draughtsman and almost criminal ignorance to the legislature. (2) Besides, the act, so far as it provides for the interests of assignees of a claim under the statute, clearly refers to assignees of the whole claim. It nowhere provides for notice to the assignees of only portions of any claim. No notice was given to the plaintiff of the proceedings before the commission, and he had no knowledge of the same. (3) As between Knapp and his representatives and the plaintiff, the award, not being a gratuity, was subject to the equitable lien of the assignment, and to the amount therein specified, the money payable under the award was appropriated to the use of the plaintiff. No act of the legislature could divest the plaintiff of this right. It could not take the property of the plaintiff and give it to another (N. Y. Oswego R. R. Co. v. Van Horn, 57 N. Y. 473 ; Embury v. Connor, 3 Id. 511; Taylor v. Porter, 4 Hill, 180; Matter of Albany Street, 11 Wend. 148).
    Y. The defendants are in no better position than Knapp would have been. The filing of the assignment with the comptroller was notice to the defendants of plaintiff’s lien, and bound the funds payable under the award without any formal acceptance (Field v. Mayor, 6 N. Y. 179; Hall v. City of Buffalo, 1 Keyes, 193 ; Parker v. City of Syracuse, 31 N. Y. 376 ; Morton v. Naylor, 1 Hill, 583; People ex rel. Dannat v. Comptroller, 77 N. Y. 45).
    YI. It is no defense that the award directed the payment of the whole amount to Knapp’s legal representative. The award, upon its face, showed that it was based on the claims for fitting up armories and drill-rooms, recited in the assignment; the comptroller, with whom the assignment had been filed, was a member of the commission, and must have known that the claims included in the award were the same as those mentioned in the assignment; and finally, as conclusive-proof of defendant’s knowledge and recognition of plaintiff’s lien, it appears by plaintiff’s Exhibit C,- that the comptroller expressly reserved from the amount of the award a sufficient sum to cover plaintiff’s claim. Under these circumstances the defendants became, in equity, trustees for the plaintiff of the amount specified in the assignment, and were bound to hold it for his benefit (Dannat v. Comptroller, 77 N. Y. 45 ; Hall v. City of Buffalo, 1 Keyes, 193).
    YII. The defendants are estopped from setting up the payment of the whole award to the Knapp estate (Continental National Bank v. Bank of Commonwealth, 50 N. Y. 575 ; cited and approved in Phelps v. People, 72 Id. 372 ; Knight v. Wiffen, L. R. 5 Q. B. 660 ; Moore v. Mayor, 73 N. Y. 238 ; Curnen v. Mayor, 79 Id. 511; Weismer v. Village of Douglas, 64 Id. 91).
   By the Court.—Sedgwick, Ch. J.

The first position taken by appellant’s counsel, is that the assignment was never acknowledged, nor was any proceeding ever taken by the respondent to enforce the same, until after the appellant had parted with the money.

The validity of the assignment did not, in any part, depend upon its being acknowledged. Thé making of it, and notice to defendants, operated, through equitable principles to make the defendant a debtor to the plaintiff. The plaintiff lost no right, by not enforcing his cause of action before this suit.

The next position is, that by chapter 473 of the Laws of 1877, any person holding an assignment of a claim of this character, was required to present his assignment before the commission. I do not find any such requirement. The act provided that, in case any person who had furnished goods for armories had sold or assigned his claim, no award should be made to the assignee of a sum greater than was paid by him for such claim; and on the hearing of each . case arising under this act, the commission was to examine and inquire as to any such assignment, and the amount paid (section 4).

This section does not, in fact, apply to this case or to any. other than where the whole of the previous claim has been assigned.

The parties before the commission were the executrix and the present defendant. Both knew of the existence of the assignment to the plaintiff. Both took part in a transaction by which an award was made to the executrix for that portion of the claim that belonged to the defendant. It seems to me but equitable that, as between these parties, it should be considered that the executrix was, in such transaction, acting for and on behalf of the plaintiff, and that the result should ■enure to his benefit.

There is no doubt that the executrix’s claim included the subject assigned to the plaintiff. The city does not take the position that she had no right to what had been assigned to the plaintiff. Gn the contrary, they pay over the whole of the award to the executrix, or to others who claim under Knapp. It must be kept in mind that the plaintiff gave full consideration for the amount he now demands.

The next objection is, that the instrument of assignment was not drawn upon any fund. It was not in form, but it was an assignment of a claim, the same in nature as a chose in action, and the proceeds of that, jpro tanto, belong equitably to the plaintiff.

The executrix was not a party to the action. The plaintiff’s position is that he is owner of the fund, pro tanto. It was not necessary that he should make the representative of his assignor a party defendant.

Judgment affirmed, with costs.

Truax, J., concurred.