Court Opinion

ID: 3619653
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:01:46.845004+00
Date Added: 2024-06-11T14:25:06.757099
License: Public Domain

The sureties, by the terms of the contract, undertook that the assignee Campbell "should faithfully execute and discharge the duties of such assignee and duly account for all moneys received by him as such assignee." It is alleged in the complaint and admitted by the demurrer that the sum of $2,769.45, which, by the decree on the accounting the assignee was directed to pay to the plaintiff, was in his hands as assignee at the time of the accounting, being part of the proceeds of the assigned estate, but that he has not obeyed said decree, but has paid no part of that sum except $1,250. The decree appropriated this fund to discharge the claim of the plaintiff for services rendered as attorney for the assignee "in the care, protection and preservation of the assigned estate." The obligation of the sureties plainly extended to this fund and rendered them liable for its proper administration by the assignee. The performance of the decree would have relieved the sureties from their obligation. The claim that they are not liable for the default of the assignee in omitting to pay over to the plaintiff the sum adjudged, is founded, we think, upon a too narrow interpretation of the language of the bond and a misconception of the term "jurisdiction" as applied to the part of the decree in question.
The undertaking of the sureties, that their principal should "duly account" for all moneys received by him as assignee, extended not merely to his rendering an account of the moneys in his hands, but also to the making of distribution according *Page 51 
to the terms of any lawful decree made on the final accounting. The court, no doubt, must have had jurisdiction to make the decree before there could have been a legal default of the assignee in its non-performance. The claim here is that the court had no jurisdiction to adjudge payment out of the estate for services rendered by the plaintiff as attorney for the assignee, as if it were a claim against the estate, and not merely a claim against the assignee.
The sureties, together with the creditors, and the assignor and the assignee, were parties to the accounting. No appeal was taken from the part of the decree in question. The circumstances which induced the court to create a charge against the trust estate in favor of the plaintiff for his services do not appear. It is sufficient that circumstances might have existed which, in equity, would justify a court in decreeing compensation to an attorney out of the trust estate, for services rendered upon the employment of a trustee in its care and preservation. (Randall
v. Dusenbury, 7 J.  S. 174; 63 N.Y. 645; Noyes v.Blakeman, 6 id. 567; New v. Nicoll, 73 id. 131.)
It is sufficient that there was jurisdiction in a proper case to make a decree like the one in question. If improperly made in this case, because not justified by the circumstances, the remedy was by appeal. The decree was not void for want of jurisdiction in the sense that it was utterly null and of no force, whether reversed or not, and bound nobody. By the operation of the decree the portion of the proceeds of the assigned estate appropriated to pay the plaintiff is discharged from the claims of the general creditors, and the assignee and the sureties are released from liability to them therefor. As between the assignee and the plaintiff the latter is clearly entitled to it. The sureties, if they are compelled to pay the plaintiff, will have simply performed their original obligation that the assignee should duly account for the trust fund.
It is, we think, immaterial that the decree was not conclusive upon the plaintiff as to the amount of his compensation, or did not prevent him from resorting to the personal liability of the assignee. He accepts the provisions of the decree by bringing *Page 52 
the action, and thereby becomes a party in interest and entitled to prosecute the bond for his benefit. (Casoni v. Jerome,58 N.Y. 321; Marsh v. Avery, 81 id. 29.)
We concur in the view of the counsel for the appellant that the provisions of section 9 of the Assignment Act of 1877, are not to be construed as limiting the right to the benefit of the bond exclusively to the original creditors of the assignor, but are intended primarily to prevent one creditor gaining an undue priority over another from the mere fact he first procured the bond to be prosecuted.
The judgments of the Special and General Terms should be reversed and judgment rendered for the plaintiff on demurrer, with costs in all courts.
All concur.
Judgment reversed.