Higginson v. Second National Bank of New York — 37 N.Y. St. Rep. 712

Majority

p. 712

Charles S. Higginson, Pl’ff, v. The Second National Bank of the City of New York, Def’t.

(Supreme Court, General Term, Second Department,

Filed February 9, 1891.)'

Headnote

1. Release—Consideration—Disputed claim.

A dispute as to the validity of a claim is both a good and valuable con- ’ sideration to support a release thereof.

2. Same.

Shortly after the death of one F., the defendant, in ignorance thereof, paid to one C. a check apparently drawnlby deceased. 0. was the confidential adviser of F.’s administratrix, and claimed to have a demand against her. Four years later the administratrix brought action against defendant for the amount of such check, but on the eve of trial executed a release, and the action was discontinued. Held, that the release was supported by the doubtful character of the claim, and was valid.

Exceptions ordered héard at general term in the first instance after verdict in favor of defendant directed by the court.

Action to recover the sum of $1,710, with interest, which sum had been deposited with defendant by one J. B. Fuller, now deceased. The claim in question was assigned to plaintiff by the administratrix of Fuller’s estate in payment and satisfaction of a judgment On the trial a release of said claim, executed by the widow and former administratrix on the discontinuance of an action brought by her, was introduced in evidence, and the court directed a verdict for defendant upon the release, to which plaintiff excepted.

p. 713

Edwin W. Sanborn, for pl’ff; Butler, Stillman & Hubbard, (John Notman, of counsel) for deft.

J. B. Fuller a check on the defendant bank where he had a deposit just before his death or some one forged his check on this bank for $1,710. The check was not presented at the bank until after Fuller’s death. The check was presented in regular course of business and was paid by the bank in ignorance of the fact that Fuller was then dead. The payee of the check was H. B. Crosby. The check was dated February 13th, 1879, and was paid February 15th, 1879,by a deposit to Crosby on that day. Crosby had been in some sort of business relation with Mrs. Fuller after her husband’s death. On the 24th of April, 1883, Mrs. Fuller, as administratrix of the deceased, brought an action to recover the $1,710 of the defendant. The defendant denied the claim and the action was referred on the eve of trial. The plaintiff then discontinued the action and executed a general release designed to extinguish the right of action. This arrangement was perfected by an order discontinuing the action upon payment of costs to the plaintiff’s attorney and referee. This order was entered the 10th of October, 1883. In the early part of that year the attorney for the bank had found out Mr. Crosby, fie was a confidential adviser in some way of the administratrix but claimed to have a demand against her for services and money paid. Mrs. Fuller had an individual claim also against Crosby. Under this state of the facts the administratrix discontinued the suit and relinquished the claim against the bank. Is the release good? There is no proof of fraud in procuring the release. It is evident that the whole facts in respect to the check as between the deceased, his widow and Crosby, are not known. There seems to be no reasonable ground for a belief in the forgery of the check. It was honorably given and paid in good faith in ignorance of the death of the giver of the check. No doubt the family had the money, for the widow was late in bringing her action if it was a forgery. At any rate the question of the bank’s liability was an open one and was represented thus by Mrs. Fuller who with her daughter was then supposed to be next of kin. The release is good. A disputed claim is the subject of a release. Home Insurance Company v. Watson, 59 N. Y., 390 .

The administratrix was not bound to go to trial in her action if she knew that she had no real claim and put the estate to the costs of the defense. The rule is the same where the party makes or defends a disputed claim as a trustee or an individual only. In no case will a mere release without consideration discharge the claim; but a dispute as to the validity of the claim is both a good and valuable consideration to support a release. Palmerton v. Huxford, 4 Den., 167 ; Pierce v. Pierce, 25 Barb., 243 ; Wehrum v. Kuhn, 10 Alby. L. J., 239.

The exception should therefore be overruled and judgment given for the defendant upon the verdict, with costs.

Dykjian and Pratt, JJ., concur.