Case Name: Davies, Hardy, Ives & Lawther, Plaintiff, v. George Abbott et al., Appellants, and Phebe W. Erdman, Respondent, et al., Defendant
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1975-12-22
Citations: 38 N.Y.2d 216
Docket Number: 
Parties: Davies, Hardy, Ives & Lawther, Plaintiff, v George Abbott et al., Appellants, and Phebe W. Erdman, Respondent, et al., Defendant.
Judges: 
Reporter: New York Reports
Volume: 38
Pages: 216–220

Head Matter:
Davies, Hardy, Ives & Lawther, Plaintiff, v George Abbott et al., Appellants, and Phebe W. Erdman, Respondent, et al., Defendant.
Argued November 17, 1975;
decided December 22, 1975
Robert S. Smith and Jay H. Topkis for appellants.
I. Phebe W. Erdman expressly assumed her husband’s obligation to pay for the stock. (Corhill Corp. v S. D. Plants; Inc., 9 NY2d 595; General Elec. Co. v Hatzel & Buehler, 19 AD2d 40, 14 NY2d 639.) II. Reliance is not a prerequisite to enforcement of a third-party beneficiary agreement. (Lawrence v Fox, 20 NY 268; Nicholson v 330 Broadway Realty Corp., 7 NY2d 240.)
Martin F. Brecker for respondent.
I. Mrs. Erdman has never agreed to pay the purchase price of the capital stock. (United States Cas. Co. v Jungreis, 21 AD2d 769; Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395; Langel v Betz, 250 NY 159; Duryee v Mayor, Aldermen & Commonalty of City of N. Y., 96 NY 477; Towle v Remsen, 70 NY 303; Carleton v Lombard, Ayres & Co., 149 NY 137; Madawick Contr. Co. v Travelers Ins. Co., 307 NY 111; Millerton Agway Coop, v Briarcliff Farms, 17 NY2d 57.) II. The court below held that the assignment indenture did not impose an obligation upon Mrs. Erdman. (Byrne v Barrett, 268 NY 199.) III. Mr. & Mrs. Erdman did not intend to benefit the Abbotts by the assignment. (Resinol v Valentine Dolls, 14 AD2d 853; Cerullo v Aetna Cas. & Sur. Co., 41 AD2d 1; Cerp Constr. Co. v J. J. Cleary, Inc., 59 Misc 2d 489; Matter of Witkind, 167 Misc 885.) IV. Mr. & Mrs. Erdman have always contested liability on her part for the unpaid purchase price of the capital stock. V. Abbotts’ motion searched the record and justified the dismissal of their cross claims against Mrs. Erdman. (Weiseman v Knaus, 24 AD2d 869.)

Opinion:
Memorandum. In this interpleader action appellant sellers have appealed only from that portion of the order of the Appellate Division which denied their motion for summary judgment against Phebe W. Erdman and dismissed their cross claim against her to recover the purchase price of stock her husband had agreed to buy. To this extent the order of the Appellate Division should be reversed.
Defendant Ellis E. Erdman agreed to purchase shares of stock from the sellers. The issue on this appeal is the interpretation to be placed on the instrument which was attached to the stock purchase agreement, bore the same date and was denominated an "assignment".
On the sellers' motion for summary judgment the affidavits submitted by the parties "raise no issues of fact or credibility, anticipate the availability of no additional extrinsic evidence, and identify no factual inferences to be drawn from extrinsic evidence. In this circumstance then there is no occasion for fact-finding by a jury and the issue is to be determined by the court as a matter of law." Matter of (Surrey Strathmore Corp. v Dollar Sav. Bank of N. Y., 36 NY2d 173, 177.)
Turning then to the provisions of the writing we hold that it constitutes not only a transfer to the wife by her husband of his rights as purchaser under the stock purchase agreement, but as well an assumption by the wife of the obligations of her husband under that agreement.
Initially we infer from the fact that the assignment was signed by the wife her intention thereby to undertake some legal obligation; her signature would normally be superfluous to the mere transfer of rights to her. We reject her present contention that she signed only to evidence her recognition that her right to receive the stock was contingent on her husband's payment of the purchase price. One provision of the assignment states: "Phebe W. Erdman, wife of the Purchaser desires to obtain this Assignment and agrees to assume the conditions of the Agreement between Purchaser and Sellers". In view of the evidently operative content of other so-called "recital paragraphs" (with reference, for instance, to the husband's retention of voting rights on the stock), we attach no significance to the fact that in form this "agreement to assume" is found in a recital paragraph of the instrument. Then, while it may be argued that the denotation of the word, "conditions", does not normally include obligations, there are contexts in which the word "conditions", as is true of such a word as "terms", may refer to all the provisions of a contract. It is even clearer, in our view, that the use of the verbal phrase, "agrees to assume" can only be. understood as manifesting a commitment to some obligation. Finally, in what might in form be termed the operative paragraph, i.e., the paragraph following the recital paragraphs and opening with the word, "Therefore", is found the clause, "the Assignee does hereby accept the herein described Assignment".
While we acknowledge that this instrument was not drafted with unmistakable clarity, we think it undeniable that the wife manifested an intention by her execution of the assignment to undertake some obligation in connection therewith. That obligation we conclude was to assume the commitments which her husband had made under the stock purchase agreement.
There is no serious argument that if this be the legal significance of the wife's participation in the assignment the commitment she thereby made to pay the purchase price may not now be enforced by the sellers.
Chief Judge Breitel and Judges Jasen, Gabrielli, Jones, Wachtler, Fuchsberg and Cooke concur.
Order insofar as appealed from reversed, with costs, cross claim of defendants Abbott against defendant Phebe W. Erdman reinstated and summary judgment granted to defendants Abbott against defendant Phebe W. Erdman in a memorandum.