Warburton v. Camp — 14 N.Y. St. Rep. 755

Majority

p. 755

Adolphus F. Warburton, as Survivor, etc., Resp’t, v. John T. Camp, App’lt.

(New York Superior Court, General Term,

Filed January 3, 1888.)

Headnote

1- Agreement to pay debt of another out of specific fund—When creditor can maintain action against promissor.

The owners of a certain award (that had been made) assigned said award to the defendiint. At the time of the assignment and as part of the transaction, the assignor said that the assignee must agree that the plaintiff should he paid first a certain sum. Held, that hy accepting the assignment the assignee bound himself to pay to the plaintiff out of the fund the said sum. That an action could he maintained by the plaintiff against him therefor.

3. Same — Hot an equitable assignment — Creditor has no lien on fund.

An agreement, either by paroi or writing, to pay a debt out of a designated fund does not of itself give an equitable lien upon the fund or operate as an equitable assignment thereof.

■ 3. Evidence — To vary written instrument may be offered by one. NOT A PARTY THERETO.

One not a party to a written instrument is not precluded from contradicting or varying such instrument hy paroi evidence.

4. Trust of personalty—How created.

A trust of personalty may be created without writing.

Appeal from a judgment in favor of the plaintiff.

The case was tried before the court without a jury.

A. B. Cruikshank, for resp’t; Wingate & Cullen, for app’lt.

In the year 1877, the plaintiff was doing, business with one Bonynge, since deceased, under the name and style of Warburton & Bonynge.

The plaintiff at the instance and request of one Heath, rendered certain services for said Heath during the years 1877, 1878, in certain proceedings between said Heath and one Loren Ingersoll and another.

It had been agreed between Heath and Isaiah T. Williams and Royal S. Crane, that they, said Williams and Crane, should have an interest to the amount of $10,000 in

p. 756

the claims against Ingersoll and another, which were then in the process of litigation. Prior to the 22d of August, 1878, plaintiff had rendered services of the value of $186.48, which sum the said Crane promised to pay.

On that day the said Crane, who was the attorney for the said Heath, also, agreed with the plaintiff that he should receive the said sum of money and interest thereon, from July 1, 1877, out of any sum of money thereafter obtained from the said Ingersoll; and said Crane, as attorney for the said Heath, signed an instrument, which purported to give plaintiff a' lien upon the said sum to that amount. There is no evidence in the case that Crane was authorized by Heath to make such a contract.

In September, 1878, Heath was awarded $10,000. Plaintiff’s services were of the value of $900.

On the 13th day of February. 1879, the said Williams & Crane assigned to the defendant, their interest in the said sum of $10,000, and thereafterwards, and in May, 1884, the defendant received said sum, with interest and costs.

In May, 1879, Crane entered into another agreement with plaintiff which is not binding upon the defendant, because, prior to the time this agreement was made, Heath had assigned all his interest in the claim against the Ingersolls to the defendant, and, therefore, had nothing which ■ he could assign, or on which he could give an equitable lien to plaintiff.

It was claimed on the trial, and on the argument of this appeal, that the defendant took said assignment in trust for various purposes, among which was the payment to the plaintiff of said sum of $900 and interest, and that said assignment was made with notice to the defendant of plaintiff’s lien.

The assignment to the defendant is in writing. It mentions the consideration that the defendant was to pay for the assignment, and provides for the distribution in a certain way of the proceeds of the award.

The plaintiff’s name was not mentioned in ttiis assignment, nor was there any provision in the assignment that any sum should be paid to him.

It is not claimed that at the time of the making of the assignment the defendant personally had notice of any lien that the plaintiff had on the award; but it was alleged that one Loomis was the agent of the defendant in the transaction in which said assignment was made, and as such agent he had notice of the lien.

The negotiations relating to the assignment from Williams & Crane to the defendant were conducted entirely ¡by said Loomis.

At the time this assignment was made, and as part of

p. 757

the transaction, Mr. Crane, one of the assignors, told said Loomis that he, said Loomis, must agree that the plaintiff should be paid first, and thereupon, said Loomis wrote on a card a memorandum of the sums to be paid out of the award, and one of the sums mentioned in the memoran ■dum is the sum claimed by the plaintiff herein.

It is to be noticed that the assignment was made after the award had been made.

This evidence warranted the finding of the trial judge that Loomis was the agent of the defendant in the transaction, but it did not warrant the further finding that the assignment to defendant was made with notice of plaintiff’s lien, for at that time plaintiff had no lien on the thing assigned.

I am of the opinion that the agreement under which the plaintiff is entitled to recover, if at all, is to be found in the transaction of February 13. Part of that agreement is in writings signed by the said Williams & Crane.

By accepting the assignment, the defendant bound himself to pay out of the award certain sums of money which were specified in the assignment, but as part of the transaction and as part consideration for the assignment he, through his agent Loomis, agreed to pay to the plaintiff, out of the fund, the sum of $900, and an action can be maintained against him therefor. Remington v. Palmer, 62 N. Y., 31 .

It is well settled in this state that an agreement, either hy paroi or writing, to pay a debt out of a designated fund, does not of itself give an equitable lien upon the fund, or operate as an equitable assignment thereof, (Williams v. Ingersoll, 89 N Y , 509 ) and for this reason, if for no other, the plaintiff cannot recover, under the alleged agreement testified to by hiña, to the effect that he was to be paid out of the first money that was received out of the award.

If plaintiff had been a party to the instruments through which defendants acquired the award, he would be precluded from contradicting or varying those instruments by paroi evidence; but, as he was not a party to them, he is not bound by them and may show what the real agreement was Coleman v. The First National Bank, 53 N. Y., 388 .

The fact that the alleged trust is not in writing will not defeat the plaintiff’s right of action, for a trust of personalty may be created without writing. Gilman v. McArdle, 99 N. Y., 451 .

I am of the opinion that defendant took the assignment of the award, subject to the trust to pay plaintiff the sum of $900.

Judgment is affirmed with costs.

Sedgwick, Ch. J., concurs.