Hyperlawhypertext legal database Jaeger v. Bowery Bank 59 N.Y. St. Rep. 385

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Jaeger v. Bowery Bank

59 N.Y. St. Rep. 385 Court N.Y.C.P. English

Delivered by Bookstaver, J.

Contents

Majority

p. 385
Caroline Jaeger, as Executrix, etc., Pl’ff, v. The Bowery Bank of New York, Deft.
(New York Common Pleas, Special Term,,
Filed April, 1894)

Headnote

Executors—Counterclaim.
A demand against the decedent, falling due after his death, is not available as a counterclaim in an action, by the executor, either at law or in equity.
Action by executrix to recover deposit of $1,620.48 left by her testator in defendant bank. Oountercla"'m for $3,000, the face value of a note which defendant had discounted for the testator, and which fell due after his death, but before this action was begun.
The defendant alleges that the estate is insolvent. Plaintiff demurs.
Abraham L. Jacobs, for pl’ff; James R. Marvin, for deft

On a more careful consideration of this demurer, I have arrived at the conclusion that it must be sustained.

The question presented is twofold. Has the defendant a right to counterclaim under § 506 of the Code of Civil Procedure or, if not, has he such a right on equitable grounds ?

The language of § 506 is that a counterclaim may be set up against an executor, “ as if the action had been brought by the decedent in his lifetime.” Had this action been brought by the ■decedent in his lifetime, this counterclaim would not h‘ave been •available because not yet in existence.

Had the meaning of the statute been that the counterclaim could be set up as if the decedent were still living and brought the action it would have been easy to say as much.

In speaking of 2 R. S. 355, § 23, in Jordan v. Nat. Shoe & Leather Bk., 74 N. Y., 467 , 474-5, the court said: “We think that the statute means that for a demand to be set off against an executor or administrator in an action brought by him it must have been due and payable from the decedent in his lifetime.” And further on : “It is claimed that § 506 has made a change in the law. It is plain that it has, in words. We are not called upon to say whether or not it has in substance.” That it has not is the view taken, and I think correctly, by Mr. Throop in his note on counterclaims in 3 Civ. Pro. Rep. (p. 226), and by Mr. Ramsey in his work on practice (vol. 1, p. 367); see also, Ewart v. Bk. of Monroe, 70 Hun, 90 ; 53 St. Rep. 497 ; Wakeman v. Everett, 41 Hun, 278 ; 2 St. Rep. 643 ; Patterson v. Patterson, 59 N. Y. 574 ; Taylor v. Mayor, etc., 82 N. Y. 17 .

p. 386
Neither does this seem a proper case for the exercise of the-equitable powers of the court in the defendant’s favor. On the contrary, to allow this set cff would he unfair to other creditors whose claims existed at the death of the decedent or matured before the defendant’s.

Had the'decedent lived he might have drawn this deposit and satisfied such prior creditors, og, they might have reached it by judgment and execution. Against both of these chances the defendant now asks to profit, and to be allowed to come in and take-all of a fund which other creditors, by reason of their earlier right, might have had to his exclusion but for the accident of the debtor’s death.

In Fera v. Wickham, 135 N. Y. 223 , 227 ; 47 St. Rep. 866 , it was said : “ By an assignment in trust for the assignor’s creditors, what natural equities previously existed became suspended by an intervention of the rights of other creditors.” By analogy the death of an insolvent debtor has the same effect in a case like the present.

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