Case ID: ny-st-rep_47/html/0643-01.html
Source: Caselaw Access Project
Author: {"author": "Landon, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Capital City Bank, App’lt, v. Adolphus Parent, Impl’d, Resp't.
    
    
      (Court of Appeals, Second Division,
    
    
      Filed October 1, 1892.)
    
    1. Attachment—Levy upon funds in hands of bank subject to draft-
    One N. obtained from plaintiff and other banks in Atlanta, Ga., large-sums of money by fraud amounting to larceny under the laws of this* state, and then absconded. Subsequently he bought for cash of defendant, a ha-nk in Syracuse, its draft for $5,000, drawn on another defendant, a bank in New York, made payable to a fictitious name which N. assumed N fled to Canada, and there transferred it for value to defendant Parent. In an action to recover a judgment for money only against. N., who was served by publication, the sheriff attempted to attach the. $5,000 paid by N. for the draft to the Syracuse bank by service of notice. Held, that the bank was not indebted to N.,_ the attachment was not levied, and there was no jurisdiction to enter the judgment against N.
    2. Same—Creditor’s action.
    As the judgment against N. would affect only the attached property,, plaintiff was in no position to bring a creditor’s action.
    3. Same.
    Plaintiff procured the arrest of N. in Canada, and then, as the offense-was not an extraditable one, made a settlement with him, and acknowledged full satisfaction of all demands upon the payment of $6,000; part of the money was raised by the sale of the draft to defendant. Held, that if plaintiff was not bound by its acquittance made upon part payment, it was bound by its representations to defendant upon which he parted with his money.
    Appeal from a judgment of the general term, fourth department, affirming a judgment- for defendant entered upon the decision of the court upon the trial at the Onondaga special term.
    
      W. Nottingham, for app’lt; Frank H. Hiscock, for resp’t.
    
      
       Affirming 34 St. Rep., 826.
    
   Landon, J.

—This is an action in the nature of a creditor’s bill. It is based upon an execution returned unsatisfied upon a judgment for money only, entered in an action in the supreme court in favor of this plaintiff against Charles C. Nelson, who-was a non-resident, was served by publication, did not appear, but in which a warrant of. attachment was issued and proof by affidavit produced and filed upon the motion for judgment that the-attachment had been levied upon property of the" defendant, which levy it was shown upon this trial was never made.

We think the complaint was properly dismissed.

The only attempt to levy under the attachment was as follows: Nelson, who had been a resident of Atlanta in the state of Georgia, on June 30, 1888, by fraudulent practices, which under our laws would amount to larceny, obtained $6,500 of the plaintiff, a banking corporation in Atlanta, and also $4,600 of two other banks of the same place, and then absconded. July 6, 1888, he bought of the defendant, the First National Bank of Syracuse, its draft for $5,000, upon another defendant, The First National Bank of New York, and paid $5,000 in cash for the •draft. The draft was payable to the order of W. G. Lee, a fictitious name which Nelson assumed. Nelson then fled to Canada, taking the draft with him, and there July 2, 1888, transferred it "•for value to the appellant, who then became the owner of it in good faith and still is its owner and holder.'

July 26,1888, the sheriff of Onondaga county, holding the warrant of attachment, assumed to levy upon the $5,000 paid by Nelson to the First National Bank of Syracuse, by serving a notice upon the bank that he thereby levied the warrant of attachment upon the moneys in its hands belonging to the defendant, and all deposits and moneys deposited by him with the bank and debts owing by the bank to him. The bank thereupon gave the .sheriff a certificate stating the facts respecting the purchase of the draft. The draft being outstanding and no default having been made upon it, the Syracuse bank was not indebted to Nelson or to the holder of the draft. It was not the. depositary or bailee of the money paid for the draft. It sold the draft for cash in the usual course of business, and that ended the transaction, unless the draft should be dishonored upon presentation, or unless plaintiff’s moneys could be identified, payment of the draft stopped, and the moneys reclaimed before the rights of third parties intervened, which would be a very different proceeding from a judgment for money only as upon contract, and an action in the nature of a creditor’s bill to secure its payment. The draft itself was not attached. Thus the attachment was not levied, and hence no jurisdiction to enter a judgment against Nelson existed.

The Code, §§ 1216, 1217, requires that in case where the defendant is a non-resident and the summons has not been personally served upon him within the state, and he has not appeared, and a warrant of attachment has been issued, proof by affidavit that the warrant of attachment has been levied upon property of the defendant must be produced and filed upon the application for judgment. Like the proof of the personal service of a summons in other cases this is jurisdictional. True, the proof by affidavit was produced and filed, but this is not conclusive, and is overcome, where as in this case proof of the actual facts shows the contrary. Ferguson v. Crawford, 70 N.Y., 253.

Besides, a judgment for money only, rendered against a nonresident who has not appeared, and upon whom service of the summons is'made by publication, and an attachment issued and levied, “ can only be enforced against the property which has been levied upon by virtue of the warrant of attachment at the time when judgment is entered.” Code, § 707.

The execution is limited to the property attached. Section 1370. Jurisdiction of the person is not obtained out of the property'attached. McKinney v. Collins, 88 N. Y., 216; Schwinger v. Hickok, 53 id., 280; Bartlett v. McNeil, 60 id., 53; Bartlett v. Spicer, 75 id., 528; Cromwell v. Gallup, 17 Hun, 49.

If, therefore, anything was levied upon under the attachment, the plaintiff’s remedy was limited to it, and whatever action in aid -of the attachment was proper, should have been brought by the sheriff, under § 655 of the Code. See Backus v. Kimball, 62 Hun, 122; 41 St. Rep., 446.

As the judgment against Nelson would affect only the attached property, it follows that the plaintiff was in no position to bring the present action. Plaintiff could in the first action only exhaust its legal remedies against the property attached, and not its legal remedies generally. It could issue no execution against Nelson’s other property.

If, indeed, a valid levy was made under the attachment, it seems to have been abandoned; if it was not made, the plaintiff’s case rests upon its failure to take any legal remedy.

The findings of the trial court which have been approved by the general term, show that with respect to this defendant the case was properly disposed of upon the merits. The plaintiff procured the arrest of Nelson in Canada, and then before the action in which the attachment was issued was commenced, upon being advised that he was not extraditable, made a settlement with him, and acknowledged full satisfaction of all demands, in consideration of $6,000, which Nelson then paid, less $320 to be paid afterward by the defendant; this was by him tendered when due, but its acceptance was refused. The defendant was present at such settlement, and for the purpose of furnishing Nelson part of the money with which to effect the same, and at the procurement and solicitation of the plaintiff, and upon its representation that it was perfectly proper and safe for him to do so, purchased the draft of Nelson for its face value, less $50, and paid $3,825.85 upon the purchase price, besides the $320 tendered to and refused by the plaintiff.

The evidence amply sustains the findings of the trial judge. If we assume that the plaintiff settled with a thief and was not bound by its acquittance of its whole demand made upon only part payment of it, yet it was bound by its representations .to the defendant upon the faith of which he parted with his money, and it cannot dispute the title which it induced him for its benefit to accept.

There may be a small surplus in the appellant’s hands as between him and Nelson, but if so, it cannot be reached in this action.

Judgment affirmed, with costs.

All concur, except Vann, J., not sitting.