Court Opinion

ID: 5411132
Source: CourtListenerOpinion
Date Created: 2022-01-08 16:09:19.200627+00
Date Added: 2024-06-11T08:30:48.736298
License: Public Domain

McCall, J.
The undisputed facts in this case show that one Lynch began an action in the Supreme Court against one Bloch, the plaintiff’s assignor herein, and, in that action, obtained an order of arrest. The defendant herein executed an undertaking on behalf of said Lynch, wherein it undertook and guaranteed that, if in such action Bloch should recover a judgment, or it was finally decided that Lynch was-not entitled to the order of arrest, he should pay all costs which might be awarded to said Bloch, and all damages which he might sustain by reason of such arrest. This action came on for trial and resulted in a verdict for the defendant (Bloch), and a judgment was entered in his favor for the sum of $125.59 costs. Subsequently an execution was issued *624against the property of Lynch and, on June 20, 1906, was returned wholly unsatisfied. Thereafter, and on January 14, 1907, the judgment was sold and assigned by Bloch to this plaintiff. On January 31, 1907, Bloch sold and assigned all his “ right, title and interest of, in and to the undertaking,” together with “ any and all causes of actions which I now have or hereafter may have upon said undertaking ” to one Kinstler. This plaintiff, the owner of the judgment, seeks in this action to recover the amount thereof from the defendant and did obtain a judgment therefor in the court below. Inasmuch as there is nothing in the assignment, pleading or proof, which signifies that plaintiff’s assignor intended to or did convey any of his rights under the undertaking to this plaintiff, the plaintiff must establish the legal effect of the assignment of the judgment to be such as to entitle him to recover the amount thereof of the defendant, and in this action, in which he and the defendant are the only parties. Reduced to its lowest terms, the claim of the plaintiff is that the legal effect of the assignment of the judgment was to vest in the plaintiff the right to recover of the defendant the amount of costs evidenced by the judgment and unpaid by Lynch, and this without regard to the fact that the undertaking itself had been assigned by Bloch to said Kinstler. The undertaking of the defendant is an entire one, although it provides for the payment, upon the happening of a contingency, of several items of damages, viz., the costs awarded to the defendant (Bloch) and all damages which he may sustain by reason of the arrest not exceeding $250. The items of damages that may be recovered, aside from the costs, consist of counsel fees in efforts to vacate the order of arrest, in securing bail, in the trial of the case and for loss of earnings during imprisonment, etc. Bamberger v. Kahn, 43 Hun, 411; Tyng v. American Surety Co., 48 App. Div. 240; Krause v. Rutherford, 45 id. 132. The respondent urges, however, that, as there is no evidence that Bloch attempted to procure the vacating of the order of arrest, it must be deemed to have been properly granted, and that he or his assignor is estopped from claiming any “ special ” damages because of his arrest. Plaintiff also *625asserts that, because Kinstier did not ask to be joined as a party, and presented no evidence of any kind as to damage, there is no foundation for the claim that a judgment in favor of the plaintiff would injure the rights of Kinstier. This argument is in support of a proposition that the plaintiff’s recovery herein bars any claim that Bloch or-his assignee may have against the defendant for damages other than the costs evidenced by the judgment assigned to the plaintiff, and that, in fact, there was no tenable claim, at the time of the assignment of the undertaking, against the defendant, except the amount of the costs awarded Bloch by the judgment in his favor. There is no validity or force in this contention. Bloch’s cause of action accrued when the action brought by Lynch terminated in his favor; and he was then, and, for aught that appears, his assignees are now, entitled to recover, not only the costs awarded him, but also for the damages that were caused him by his arrest; and that it does not appear that up to the present time either Bloch or his assignee have asserted any claim to recover for damages is no ground or reason for affirming that proof of such damage cannot be given and a recovery be had therefor. .-Keither was Bloch’s assignee, Kinstier, compelled to ask that he be made a party to the present action; and that he has not, as yet, pressed his claim is not evidence that he has none. Assuming then, but not deciding, that the legal effect of the assignment of the judgment against Lynch for costs vested in the plaintiff’s right or interest in the amount recoverable upon the undertaking, it is clear that the plaintiff’s claim therein would be limited to the amount of such costs; and by no theory could it be extended to the other elements of damage covered by the bond. The plaintiff would, therefore, have only an equitable interest, bounded by the amount of the judgment, in any sum that might be recovered of the defendant in an action in which all interested claimants were parties. The assignment of the judgment to the plaintiff would not create the right to divide defendant's liability into as many complete causes of action as there might be owners or claimants to the several items of damage which the defendant was obliged to pay, in accordance with the con*626ditions of the bond. The defendant is liable but for one cause of action, and has a right to insist that, having incurred but one liability, all the parties claiming an interest, in any sum of money which it may be found obligated to pay, shall be made parties in one action; and it cannot be subjected to costs in several separate actions brought by each claimant. If, therefore, the plaintiff, hy operation of law, or otherwise, acquired any right or interest in the amount which may be recovered of the defendant by reason of its having given the undertaking aforesaid, those rights must be fixed and determined in an action in which all the claimants in the subject-matter are made parties. The authorities referred to in respondent’s brief add no strength to his position. The rule that the transfer of the principal debt carries with it all collaterals, etc., is well known (Allen v. Brown, 44 N. Y. 233), and is applicable only in cases where equity requires it and not where it would work an injury to the assignor, as where the securities stand for several distinct debts. How the judgment assigned to plaintiff is merely an item of damage which, when proven in an action on the undertaking, would fix defendant’s liability to that extent, the defendant still remaining liable up to $250 in amount for all other proved items of damage, showing that said security beyond peradventure stands for several possible distinct debts, held by several distinct persons, all of whom, we believe, are necessary parties to a complete and final settlement of the issues involved. This, of course, will present the suggestion that the proper tribunal for a disposition of these issues is a court of equity; but, in any event, this judgment must be reversed.
Gtldebsleeve and Fobd, JJ., concur.
Judgment reversed, with costs, and complaint dismissed.