Flynn v. Lowery — 1 N.Y.S. 235

Majority

p. 235

Flynn v. Lowery et al.

(Supreme Court, General Term, Third Department.

May 17, 1888.)

Headnote

Sake—Rescission op Contract—Proof of.

Plaintiffs, at Pittsburgh, Pa., sold goods which were shipped to the vendee at Albany, N. T. He did not receive the goods or pay the charges thereon, and after-wards, April 19,1886, wrote that he was in trouble, and could not receive them. On-the 22d plaintiffs wrote that he need not. This was received on the 84th. On the ■ 20th the vendee made an assignment to defendant, who on the 26th took possession-of the goods. Reid, that the sale was rescinded, and that plaintiffs would recover" the goods from the assignee.

Appeal from circuit court.

Suit brought by John Flynn, John Lowery, and others against Edwin C'.~ Ledger, as assignee of Simon Bell. Trial'at the circuit by the court without-a jury, and from the judgment in favor of defendant plaintiffs appealed.

Argued before Learned, P. J., and Landon and Ingalls, JJ.

A. Vanderzee, for appellants. Eugene Burlingame, for respondent.

This action was brought by the plaintiffs against the defendant, as assignee of Simon Bell, under a voluntary assignment for the benefit, of creditors, to recover the value of a quantity of glass chimneys which came-to the possession of the defendant under the following circumstances. On the-8th day of April, 1886, Simon Bell, who was a merchant doing business in the • city of Albany, ordered from the plaintiffs, who were doing business at Pittsburgh, Pa., a quantity of glass chimneys. The chimneys were shipped by rail- • road on the 12th day of April, 1886, and arrived in Albany April 16, 1886. ■ Bell was notified that the goods were at the depot at Albany, but allowed them. to remain there, and did not receive the same, or pay the charges thereon. On the 19th of April, 1886, having discovered that he had become insolvent, he • addressed to the plaintiffs the following letter: “Simon Bell, Importer and' dealer in China, Glass, and Earthen Ware, 96 and 98 South Pearl Street, Albany, N. Y., April 19, 1886. Excelsior Glass Co.—Dear Sirs: Your' chimneys have just arrived, but I am not in condition to receive them, as I am in trouble. If you are not too angry with me, I can no doubt tell you how to • dispose of them in Albany. I am awfully sorry to cause you any trouble, but • I could not help it. Truly yours, S. Bell.” This letter was mailed to the-plaintiffs the day of its date. On the 22d day of April, 1886, an answer to the-above letter was mailed by plaintiffs at Pittsburgh, addressed to Simon Bell,, which was as follows: “In reply to yours of the 19th inst., would say that we* are not angry with you. In fact, we are under many obligations for protecting our interest in this matter. You sell the goods, give us the name of the party to whom you make sale, and we will make invoice to them; or perhaps,

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-after you get matters fixed up, you can take the goods yourself.” This letter was received by Mr. Bell on the 24th of April, 1886. On tile 20th day of April, 1886, Bell made a voluntary assignment to the defendant for the benefit of •creditors. On that day the assignee took actual possession of the assigned property, but did not take actual possession of the chimneys on that day, but -they remained in the custody of the railroad company until the 26th day of April, when the defendant went and took the chimneys, and paid the charges .thereon. On the 27th of April, 1886, Mr. Bell addressed to the plaintiffs the following letter: “Office of Simon Bell, Importer and Dealer in Qhina, Glass, •and Earthen Ware, 96 and 98 South Pearl St., Albany, N. Y., April 27,1886. Excelsior Flint Glass Oo.—Dear Sir: Yours of the 22d is received, and would have been answered sooner if I had good news to send; but the news is bad. The lawyer for the assignee compelled him to put your goods in with the assets, -and told him he might get into trouble if he did not, as they were beyond any -doubt part of my assets, being in Albany nearly a week before the assignment. The whole thing is out of my hands, and I am unable to do as I would like. - This trouble came on by a sharp trick of a well-known glass man. I will lose heavily by his trickery. Respectfully yoúrs, Simon Bell.” The letters of .the 19th and 22d April were received in the due course of mails between Albany -and Pittsburgh. On the 19th day of April, 1886, the plaintiffs and Simon Bell were authorized to rescind the contract of sale. Bell had paid no part of the price of the chimneys, nor had he paid the charges thereon, nor had he assumed .to control the same. He had ascertained that he was insolvent, a fact not known to the plaintiffs when they shipped the goods, as their first information in regard to his embarrassed circumstances was probably derived from his letter of the 19th April. The chimneys were in the custody of the railroad company, and the charges remained unpaid,-and the assignment had not been executed when the last-mentioned letter was mailed to the plaintiffs, and ’the title to the chimneys had not at that time certainly vested in the defendant under the assignment, which was not executed until the day following. The plaintiffs promptly accepted the offer of the purchaser Bell, as appears by this letter of 22d of April, which was received by Mr. Bell on the 24th April. In Parsons on Contracts (volume 2, p. 190, 4th Ed.) the author remarks: “The defendant may rely on the fact that the contract has been rescinded. And this may have been done by mutual consent, or by the plaintiff, -who had the right to do so, or by the defendant, if he had the right. Whichiever party has the right to rescind must do it within a specified time, if there Ibe such a time, or otherwise within a reasonable time.” We think the plaintiffs’ contention finds support from the following cases: Harris v. Pratt, 17 N. Y. 250 ; Babcock v. Bonnell, 80 N. Y. 244 . Manifestly, the facts herein ¡present a case somewhat exceptional. Ordinarily one party to the contract -Insists upon performance thereof; but in this case Mr. Bell, prompted by an honest motive, mailed a letter which contained aproposedrescission of the con¡tract, which was intended for- the benefit of the plaintiffs, and they promptly .accepted the same, and informed Bell thereof by letter, which was received ■by him in the due course of the mail, and which was previous to the time the ■assignee took the chimneys from the railroad company. If Bell had made a -.sale of the chimneys to a bona fide purchaser for value, a very different question would be presented. The defendant, as assignee under the voluntary .assignment for the benefit of creditors, acquired no title superior to that which Bell possessed at the time the assignment was executed. The mere fact that the plaintiffs charged the price of the chimneys to the defendant as assignee, after they were informed that the defendant had taken possession thereof, cannot reasonably be regarded as amounting to a consent on their part that the chimneys should be considered a part of the assets under the assignment. The circumstances rather favor the view that the plaintiffs intended to hold the defendant liable for the value of the chimneys, upon the assumption that

p. 237

he had taken the same without authority, and therefore became liable for their value. We can hardly infer from the facts that the plaintiffs intended to contribute to the assets, for the benefit of the creditors generally, to the value of the chimneys, and then accept a pro rata share under the assignment. The-strong equity which exists in favor of the plaintiffs, under the facts of this case, entitle them to all the protection which the court can properly extend to them. They are chargeable with no improper conduct, and were not guilty of loches. They acted promptly upon the suggestion of Mr. Bell, and did all that they could to preserve their rights. The judgment should be reversed,, and a new trial ordered, with costs to abide the event of the action.

Learned, P. J., and Landon, J., concur.

Cases cited

Babcock v. Bonnell 80 N. Y. 244 N.Y. 1880-02-24 p. 236