Case Name: Lewis & Pelton vs. Berry
Court: New York Supreme Court
Jurisdiction: New York
Decision Date: 1873-04-01
Citations: 64 Barb. 593
Docket Number: 
Parties: Lewis & Pelton vs. Berry.
Judges: Mullin, Talcott and E. D. Smith, Justices.]
Reporter: Barbour's Supreme Court Reports
Volume: 64
Pages: 585–590

Head Matter:
Lewis & Pelton vs. Berry.
An order drawn upon a particular fund, or for the payment of particular money in the hands of the drawee, not otherwise appropriated, with notice of such order, and particularly upon its presentment to the drawee for payment, is an equitable assignment of the money of the drawer in the hands of the drawee, to the amount of such order.
Where a paper, given as, and understood by the parties to be, an order for the payment, by the drawee, of $100 out of wages or payments earned or to be earned, and payable to the drawer, under a building contract, between him and the drawee, is duly presented to the latter for payment, when he has in his hands the sum of $100 due and payable to the drawer, the holder has the right to have that sum paid to him, upon the order; and, upon the refusal of the drawee to pay it, may recover it of him.
Where it was proved that the order was drawn in pursuance of an agreement made with the drawee, before it was given, and the drawee, upon its being shown to him, by the drawer, admitted it to be good, and that a sum equal to tiie amount of the order was due from him to the drawer, upon the contract between them; held that the holder was entitled to recover the amount of the order; although there had been no acceptance, on presentment.
THIS action was brought upon an order in favor of the plaintiffs, drawn by one Starring upon the defendant, for $100, as foEows:
“Illicit, H. Y., June 14,1871. George Berry, pay to Lewis & Pelton one hundred doEars and charge to my account.
(Signed) Jacob H. Starring. ”
Starring, the drawer of said order, was indebted to the plaintiffs in the amount of said order at the time it was given, and was at work for the defendant on a contract for building a house, under which he was entitled to receive from the defendant payments as foEows: Two hundred doEars when the ceEar was completed; three hundred doEars on the 15th of June; two hundred doEars when the frame was up; two hundred doEars when the casing was done; seven hundred and fifty doEars when the job was completed.
It appears that the said order was presented to the defendant on the 17th day of July, and the defendant refused to accept it, but said to the plaintiffs he would let them know when the payment was due, and said also, at the same time, that Starring was progressing with the job. On the same day, at an earlier hour, the said Starring showed the order to the defendant, and asked him if it was not good,, and the defendant said he presumed it was, and asked him how he made it out, and Starring said he “left $100 back.” The defendant testified that he “looked, and found there was $100 back on the contractalso, that he “knew, that morning, that the order had bepn given to Lewis & Pelton,” (the plaintiffs.)
The case was tried, in the first instance, in a justice’s court, where the plaintiff recovered a verdict for $100 and costs. The case was appealed to the county court, where a new trial was had, and a verdict found for the defendant The plaintiff then applied to that court for a new trial, which was denied, and hence the appeal to this court.
Burrows & Palmer, for the appellants.
I. An order of this nature operates as an equitable assignment of the fund on which it is drawn, and the drawee being notified of the assignment must pay accordingly, though there is no formal acceptance, either written or verbal. (Morton v. Naylor, 1 Hill, 583. Hall v. City of Buffalo, 1 Keyes, 193. Lowery v. Steward, 25 N. Y. 239. Bradley v. Root, 5 Paige, 632. Clark v. Mauran, 3 id. 373.) The specific fund was desig nated (if not on the fade of the order) by the setting apart by Starring’ of $100 of the $300 dne to him from the defendant, and leaving it in the defendant’s hands with directions to pay the plaintiffs, and his promise to do so.
II. The pretended agreement with Starring, and the payment by the defendant of the note which he signed with him, did not relieve him from liability to the plaintiffs ; for, payment by a debtor of his debt to the original creditor, after notice that the debt has been assigned, constitutes no defence to a suit brought by the assignee. (Field v. Mayor &c., 2 Seld. 179.)
III. Barring the question of equitable assignment, the plaintiffs were entitled to recover upon the promise made by the defendant to Starring for the benefit of the plaintiffs. An action may be maintained on a promise made by the defendant to a third person for the benefit of the plaintiffs, without any consideration moving from the plaintiffs. Accordingly, where B. being indebted to the plaintiff sold property to the defendant, who agreed to pay the price of it to the plaintiff ón account of his demand against B., held that the plaintiff might maintain an action against the defendant on such a promise. (Barker v. Bucklin, 2 Denio, 45. Burr v. Beers, 24 N. Y. 178. Seaman v. Hasbrouck, 35 Barb. 151. Lawrence v. Fox, 20 N. Y. 268.. Farley v. Cleveland, 4 Cowen, 432;. S. C., 9 id. 639. Elwood v. Monk, 5 Wend. 235.)
IV. The verdict should have been for the plaintiffs. They were entitled, under the undisputed evidence, to a verdict for the amount left by Starring in the defendant’ s hands for them. The county court should have granted a new trial on the grounds stated in the case and exceptions.' The judgment should be reversed and a new trial granted, on the ground that the verdict was against evidence.
S. S. Morgan, for the respondent.
I. The order was not drawn on any particular fund, and therefore was not an assignment of any particular fund or any part thereof. An order drawn in the ordinary form, not describing any particular fund, or using any words of transfer of the whole or any part of the account, but containing the usual request to pay a certain amount of money, is of the same legal effect as a bill of exchange, and does not amount to an assignment of the funds of the drawer in the hands of the party upon whom the same is drawn. And there is no liability of the party upon whom such an instrument is drawn until after it is accepted, and until payment or acceptance it is always revocable by the drawer. (Lunt v. Bank of North America, 49 Barb. 221, 227-231. See Harris v. Clark, 3 N. Y. 93 ; Cowperthwaite v. Sheffield, Id. 243.) There is no difference between a bank check and a bill of exchange. (Harker v. Anderson, 21 Wend. 372.) An unaccepted check on a bank, not expressly naming the fund upon which it is drawn, does not work an assignment of the fund in the bank, or create a lien on it. (11 Paige, 612. 5 N. Y. 243. 6 id. 412, 417.) The order in question was general in form, and not being accepted by the defendant, the plaintiffs were not entitled to recover, and the defendant’s motion for a nonsuit should have been granted.
II. Starring, the drawer of the order, had the right, on the 17th of July, to revoke the order. (Lunt v. Bank of North America, 49 Barb. 221.) But the order was not presented for acceptance or payment until after the arrangement with Starring on the 17th of July. It was presented between 12 o’clock, noon, and 3 p. m. Then there was nothing due Starring, and Starring left the job that day and assigned the contract to his father, Jeremiah Starring. Starring failed to fulfill his contract ; and neither he nor Ms assignees (Lewis & Pelton who held the order) could recover any part of the contract price, after Starring had made default in his contract, by abandoning the job. The plaintiff has had the benefit of submitting the question to the jury, and the finding of the jury should be sustained.

Opinion:
By the Court, E. Darwin Smith, J.
It does not distinctly appear in the case upon what ground the cause was put to the jury.
The charge is not given, and no points seem to have been made at the trial, in respect to it. We must therefore assume that the charge was satisfactory to both parties, and presented the case upon the correct legal principles to the jury.
Assuming, as we must, therefore, that upon the law the jury were advised that the plaintiffs had no legal right of action upon the order, the same not having been accepted, but if they believed that it was given as, and understood by the plaintiffs, Starring and the defendant, to be, an order for the payment of $100 out of the wages or payments earned or to be earned and payable under the contract between the said Starring and the defendant, for the building of the house which said Starring was then erecting for the defendant, and that was the account referred to in said order to which the defendant was requested by said order to charge the $100 mentioned in the same, on payment, then if said order was duly presented to the defendant for payment when he had in his hands the sum of $100 due and payable to said Starring by the tenor of said order, the plaintiffs had the right to have such money paid to them upon said order; and that the refusal of the defendant to make such payment entitled the plaintiffs to a verdict for said sum of $100; then I think a verdict for the defendant was erroneous, and clearly against the evidence. An order drawn upon a particular fund, or for the payment of particular money in the hands of the drawee, not otherwise appropriated, with notice of such order, and particularly upon its presentment to the drawee for payment, is an equitable assignment of the money of the drawer in the hands of the drawee, to the amount of such order. (Lewis v. Shuart, 24 N. Y. 242. Martin v. Naylor, 1 Hill, 583. Hall v. City of Buffalo, 1 Keyes, 199.)
[Fourth Department, General Term, at Rochester,
April 1, 1873.
Mullin, Talcott and E. D. Smith, Justices.]
It appears from the testimony of Starring that the order was drawn by him in pursuance of an agreement made with the defendant, before it was given; that he also talked with him about it on the morning of the 17th of July, the day of its presentment, and exhibited it to him about 8 or 9 o'clock in the morning of that day, and the defendant then admitted it to be good, and that he had $100 back out of the $700 previously earned by Starring on the contract, which Starring then informed him he had left back to pay this draft. Upon these facts, admitted and testified to by the defendant himself, it seems to me the plaintiff was clearly entitled to a verdict. Upon the undispted facts of the case, the verdict for the defendant was against the clear evidence in the case.
The judgment should, therefore, be reversed, and a new trial granted, with costs to abide the event.