Court Opinion

ID: 6236368
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:33:27.693671+00
Date Added: 2024-06-11T08:58:03.767526
License: Public Domain

Mr. Justice Gordon
delivered the opinion of the court, January 5th 1880.
In Nesmith v. Drum, 8 W. & S. 9, an equitable assignment is said to be an agreement in the nature of a declaration of trust, which a chancellor, though deaf to the prayers of a volunteer, never hesitates to execute when it has been made on valuable, or even good consideration. Hence, an order upon an attorney to pay over the proceeds of a claim, when collected, to a surety for the extinguishment of a note on which he was endorser for the drawers, was held to be an assignment. Following this authority, had there been a copy of the resolution, of the 14th of July 1874, served on the appellants, defendants below, at the time of the assignment of the bills against Porter, Moreland & Co. and others, or even had they had notice of that resolution, we would have been compelled to hold them as trustees for the employees of the company. But the auditor finds that Guthrie v. Byles had no such notice; on the other hand, when the assignment of these claims was made to them, they were instructed to apply the money when collected; 1st, upon a judgment of Julius Byles; 2d, to a claim of Guthrie & Byles; 3d, to such employees as should be designated by the book-keeper of said company. Now, as was said in Beans v. Bullitt, 7 P. F. Smith 221, the mere avowal of an intention to apply a fund, or have it applied, in a particular way, has never yet been held to be an application of it. Suppose then, the resolution had remained on the books without anything further having been done, would that have been a valid assignment of the claims specified to the employees? Would it have protected those claims from attachment by other creditors ? Surely not. It was the mere declaration of an intention to appropriate these claims to a particular purpose, and until there was an execution of that resolution by an actual assignment of the claims to the trustees there was no application of them; no interest vested in the employees, and in the meantime the company might repeal its resolution or disregard it, and appropriate the bills as it saw fit. But when the assignment was made to the appellants they were directed by the officers of the company to apply the fund, which might come into their hands, in the manner above stated. *273If then, they were trustees, and not mere agents or attorneys of the company, they can be held to no other trust than that which they agree to take upon themselves, neither can they be called to an account by persons between whom and themselves there is no privity of contract. The officers of the corporation, doubtless, had a general power to appropriate its assets to the payment of such of its debts as they might designate, and hence when they put certain claims into the hands of the appellants to collect and appropriate in a particular manner, it was not the duty, neither Avas it in the power of the appellants, to search the books of the' company to ascertain Avhether the officers were not transgressing some resolution which might have been previously passed by that company. It is possible, as we have already intimated, that had Guthrie & Byles been officially notified of the resolution, they would have been bound by it rather than by the instructions of the officers, for then the question of the power of those officers to disregard that resolution would have arisen, and they would have been held to a proper determination of that question. As the matter stands, however, all this is out of the case; the appellants did what they undertook to do, and, having so done, they can be held to nothing more.
The decree of the court below is now reversed and set aside and the petition of the appellees is dismissed at their costs.