Locomobile Co. of America v. Nichols

This action is for moneys had and received. In March, 1908, two automobiles belonging to plaintiff were destroyed while in transit on the International & Great Northern Railway Company, with a resultant loss of $3,553. Plaintiff was also protected to the extent of $2,139 by a policy of insurance by the Columbia Insurance Company. The latter company paid the amount for which it was liable to plaintiff, receiving from the latter a paper, which assumed some importance in the trial of the case, and was known as Exhibit B. This paper reads as follows:

“In consideration of your advancing us the sum of twenty-one hundred thirty-nine and 00/100 dollars §2,139.00 as a loan to be repaid without interest as recovery may be effected from the carriers in respect of the undernoted merchandise, we hereby agree to put forward a claim against the carriers and/or bailees of the said merchandise in whose hands the same received damage and upon receiving payment from them we hereby undertake to refund you whatever is recovered up to the amount of this loan §2,139.00. All over this amount to be retained by us.

“It is further understood and agreed that you are to be responsible for all the costs, attorney’s fees and expenses incurred in connection with the claim.”

It is to be observed that while the paper speaks of the money paid by the Insurance Company as a loan to be repaid without interest, such promise of repayment' is contingent upon a recovery from the carrier, and also that there is no assignment of the claim to the Insnr

[1] The plaintiff’s right to have been paid the sums for which it now sues is so clear that we should content ourselves with affirming the judgment without writing an opinion were it not for a defense which is strenuously insisted upon and which deserves consideration. In collecting the money defendant acted, as he well knew, as plaintiff’s agent, and the money collected belonged to plaintiff. He was chargeable with the knowledge, which he could have acquired by inquiry, of plaintiff’s rights, which were to receive the whole amount collected, less $2,139, due to the Insurance Company. Indeed, strictly

[2] The one defense.which seems to call for consideration rests upon the following facts: It was on October 20, 1911, that defendant sent his check to plaintiff. As already' said, plaintiff at once protested to the amount, and began active negotiations to induce defendant to pay more. There never was any question but that plaintiff was entitled at all events to the amount represented by the check. Pending these negotiations plaintiff held the check and did not deposit it for collection until April 4, 1912, when it was paid. The defendant now insists that the retention and deposit of this check operated as an accord and satisfaction. To support this defense he relies upon Fuller v. Kemp, 138 N. Y. 231 , 33 N. E. 1034 , 20 L. R. A. 785 , and Nassoiy v. Tomlinson, 148 N. Y. 326 , 42 N. E. 715 , 51 Am. St. Rep. 695 , both of which had to do with claims wholly unliquidated. Both of these cases were examined and distinguished in Eames Vacuum Brake Co. v. Prosser, 157 N. Y. 289 , 51 N. E. 986 , the court saying:

“In these cases the doctrine of accord and satisfaction was carried to the extreme limit, and it is not our purpose to further extend the rule.”

The case last cited was similar to the present in this: That the controversy was between a principal and its agent; that the agent' had collected money belonging to the principal, and had paid over a sum concededly due, retaining a further sum claimed to be due for commission, which claim, however, the principal repudiated; that the principal kept and retained the amount paid over to it, as well as statements on account showing the amounts collected, the amounts paid over, and the amounts retained for commissions claimed. The court, after discussing the general principles of an account stated, said;

“Ordinarily the retention of a check inclosed in a letter, which refers to the amount as a balance due on accounts between the parties, will not be held to be an accord and satisfaction so as to bar an action for the balance due. McKay v. Myers, 168 Mass. 312 [ 47 N. E. 98 ]; Day v. McLea, L. R. 22 Q. B. Div. 610. It is only in cases where a dispute has arisen between the parties as to the amount due and a check is tendered on one side in full satisfaction of the matter in controversy that the other party will be deemed to have acquiesced in* the amount offered by an acceptance and a retention of the check. Nassoiy v. Tomlinson, supra; Fuller v. Kemp, supra. In this case the defendants were engaged in collecting money for the plaintiff; their character was that of agents. From time to time they remitted balances to the plaintiff. It was the plaintiff’s money. It objected early to the retention of commissions by the defendants, and continued such objection through several months, to nearly every account rendered in which commissions were charged. We think that the court below properly held that no accord and satisfaction were established.”

See, also, Komp v. Raymond, 175 N. Y. 112 , 67 N. E. 113 ; Fireproof Const. Co. v. Butterfield, 143 App. Div. 708 , 128 N. Y. Supp. 407 .

The language we have quoted fits exactly the facts in the present case. The money which defendant collected was the plaintiff’s money. No dispute arose until the check was received by plaintiff, and no dispute ever arose as to plaintiff’s right to receive and retain, at all events, the amount represented by the check. It concededly belonged

The determination of the Appellate Term is affirmed with costs. Order filed.

INGRAHAM, P. J., and CLARKE and HOTCHKISS, JJ-, concur. DOWLING, J., dissents upon the ground of an accord and satisfaction between the parties.