Case Name: In the Matter of the Industrial Commissioner of the State of New York, Judgment-Creditor-Respondent, against W. E. Hedger Transportation Corporation, Judgment Debtor. Haight, Deming, Gardner, Poor & Havens, Third Party; Horace M. Gray, Claimant-Appellant
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1956-07-11
Citations: 1 N.Y.2d 503
Docket Number: 
Parties: In the Matter of the Industrial Commissioner of the State of New York, Judgment-Creditor-Respondent, against W. E. Hedger Transportation Corporation, Judgment Debtor. Haight, Deming, Gardner, Poor & Havens, Third Party; Horace M. Gray, Claimant-Appellant.
Judges: 
Reporter: New York Reports
Volume: 1
Pages: 503–507

Head Matter:
In the Matter of the Industrial Commissioner of the State of New York, Judgment-Creditor-Respondent, against W. E. Hedger Transportation Corporation, Judgment Debtor. Haight, Deming, Gardner, Poor & Havens, Third Party; Horace M. Gray, Claimant-Appellant.
Argued June 5, 1956;
decided July 11, 1956.
Horace M. Gray, in person, and Edward R. Phillips for Horace M. Gray, claimant-appellant.
I. Claimant has not claimed an attorney’s lien. II. The third party was not indebted to the judgment debtor. (Lawrence v. Fox, 20 N. Y. 268.) III. The Special Term was without jurisdiction to do other than dismiss the proceeding. (Bank of United States v. Canal Securities Corp., 250-App. Div. 505; Foley v. Foley, 257 App. Div. 154; Rodman v. Henry, 17 N. Y. 482; Rosenberg v. Rosenberg, 259 N. Y. 338; Matter of Delaney, 256 N. Y. 315; Matter of Powley v. Dorland Bldg. Co., 281 N. Y. 423; Liberty Stor. & Warehouse Co. v. Van Wyck, 256 App. Div. 641; People v. Square Deal Poultry Corp., 218 App. Div. 781; Kenney v. South Shore Natural Gas & Fuel Co., 201 N. Y. 89.)
Jacob K. Javits, Attorney-General (Emanuel Strauss, James O. Moore, Jr., and Francis R. Curran of counsel), for judgment-creditor-respondent.
I. The courts below have properly rejected the claim of ownership by appellant of the settlement fund of $10,000. (Miller v. Clayton Coffee Pot, 238 App. Div. 121; Matter of Strand v. Piser, 291 N. Y. 236; Matter of Wickwire Spencer Steel Co. v. Kemkit Scientific Corp., 292 N. Y. 139; Matter of Dawnenberg v. Leopold & Co., 188 Misc. 250; Matter of Flynn, 157 App. Div. 241; D., L. & W. Coal Co. v. Kenlon, 164 Misc. 32; Matter of Levitt v. Fichtner, 191 Misc. 610; Recher v. Gumpp, 253 App. Div. 731; Andrewes v. Haas, 214 N. Y. 255; Moldauer v. Walzer, 197 Misc. 649.) II. The court at Special Term did not violate any constitutional rights of appellant. (Matter of Brock, 245 App. Div. 5; Hanna v. Mitchell, 202 App. Div. 504, 235 N. Y. 534; General Inv. Co. v. Interborough R. T. Co., 235 N. Y. 133; Stewart v. Ahrens, 273 N. Y. 591; Matter of Palmer, Barber, Matters & Merritt v. Stewart, 273 N. Y. 592.)

Opinion:
Desmond, J.
The order should be reversed and the third-party proceeding dismissed. On the undisputed facts appellant necessarily occupied one of two positions, either of which makes him entitled absolutely to the $10,000 check. At the least, he was an equitable assignee, from the time of commencement of the Hedger-Aluminum suit, of the recovery therein for his attorney's fees, with priority over any later attaching tax or other lien (Judiciary Law, § 475; Beecher v. Vogt Mfg. Co., 227 N. Y. 468, 472; Matter of Herlihy, 274 App. Div. 342, 345). Respondent does not even argue that its claim has priority over appellant's lien, if any, as attorney, and there is no real dispute that appellant's services were worth at least the agreed $10,000.
Actually on these facts, appellant individually was the sole beneficiary of an agreement by Aluminum to pay to appellant, individually, $10,000 in consideration of his furnishing a release and discontinuance of the Hedger suit, and so he had title to the $10,000. That being so, no sovereign right of the State enters into the picture.
Procedurally, appellant's claim of title to the fund could not properly be tried out in these supplementary proceedings (Kenney v. South Shore Natural Gas & Fuel Co., 201 N. Y. 89; Rosenberg v. Rosenberg, 259 N. Y. 338, 341; Matter of Delaney, 256 N. Y. 315, 321). But regardless of procedure, appellant has clearly shown his right to the fund and the proceeding should be dismissed on that ground.
The order of the Appellate Division and that of Special Term should be reversed, with costs in all courts, and the third-party proceeding dismissed.