Case ID: misc_90/html/0304-01.html
Source: Caselaw Access Project
Author: {"author": "Pendleton, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Richard Doughty and Max S. Grifenhagen, as Sheriff of the County of New York, Respondents, v. Sidney F. Weston, as Chairman of a Committee of Creditors of Felber Engineering Works, Appellant.
    (Supreme Court, Appellate Term, First Department,
    May, 1915.)
    Assignments — when notice of, need not he given to debtor — when assignment valid against assignor — attachment.
    Notice of the assignment of a debt need not be given to the debtor.
    In an action brought in aid of an attachment held by the sheriff to compel payment of a debt due from defendant to plaintiff, an assignment of said debt before levy by the sheriff under the attachment cannot be called" in question, for though voidable as to creditors the assignment is valid against the assignor and his attaching creditors.
    Appeal by an interpleaded defendant from a judgment of the City Court of the city of New York, entered after a trial by the court without a jury.
    Frederick M. Harris, for appellant.
    Sidney R. Lash, for respondents.
   Pendleton, J.

The action was brought originally in aid of an attachment by the plaintiff in the attachment suit and the sheriff holding the attachment to compel payment of a debt due by defendant to the plaintiff in the attachment suit. The defendant paid the money into court and interpleaded an alleged assignee of the debt, who has appeared and is the appealing defendant, and he now claims the debt was assigned to him before the levy by the sheriff under the attachment. The defendant on the trial offered in evidence an assignment to him of the debt in question in writing by the defendant in the attachment suit dated long prior to the levy under the attachment after evidence of 'delivery and of notice thereof to the debtor. This was excluded and the court directed judgment for plaintiffs, holding that the debt had not been assigned. The ground of the refusal to admit the assignment in evidence, as given by the court, was that1 it had not been served ’ ’ on the Sicilian Asphalt Company, the debtor.

It is very clear that the reason given is untenable. Notice even of the assignment to the debtor is unnecessary (Columbia Bank v. Equitable Life Assurance Soc., 61 App. Div. 594), but, if it were, the evidence shows such notice. Plaintiffs’ objection to the paper was not confined to the reason given by the court and the ruling is now sought to be sustained on the ground that the assignment did not conform to the requirements of section 3 of the Debtor and Creditor Law, relating to assignments commonly known as insolvent general assignments for the benefit of creditors. The question is presented in a two fold aspect: First, that the assignment offered is inadmissible under the pleadings, because nothing less than an assignment in accordance with the statute would satisfy the allegations of the answer, and, second, that the assignment offered was invalid or ineffective as an assignment as against plaintiff, because not made in the form prescribed by said statute. Neither ground is well taken. The allegations of the answer do not necessarily call for, nor do the circumstances require, an assignment of the class covered by that statute. Conformity with the statute was neither required by the allegations of the answer nor the facts. That statute relates to general assignments by insolvents of all their property to an assignee for the benefit of creditors, to be administered by the assignee in accordance with the rules of law applicable to such proceedings. The assignment in question was not a general assignment of property, but only of the debt in question and some other claims. It is not alleged in the answer, nor does it appear that the assignor was insolvent. There is a vast difference between insolvency and inability to pay. debts. It was not made to an assignee for creditors, such as is contemplated in the statute, but apparently to a committee in accordance with some special plan agreed upon.

It was unnecessary, therefore, either to conform to allegations of the answer or to establish the validity of the assignment that it should be shown to conform to the.requirement of the statute in question. Moreover, assignments of choses in action, even if voidable as to creditors, are valid as against the assignor and attaching creditors. They cannot be called in. question, except by a judgment creditor’s action. Throop Grain Cleaner Co. v. Smith, 110 N. Y. 83; Thurber v. Blanck, 50 N. Y. 80. Although judgment had been rendered in the attachment suit, this was an action in aid of the attachment and not a judgment creditor’s action, as execution had not been returned unsatisfied •—a necessary prerequisite to such a judgment creditor’s action. Code Civ. Pro., § 1871.

The refusal to admit the assignment in evidence was error, and judgment must be reversed and new trial ordered, with costs to appellant to abide the event.

Guy and Bijur, JJ., concur.

Judgment reversed and new trial ordered, with costs to appellant to abide event.