Sensone v. Alexander — 74 N.Y. St. Rep. 434

Majority

p. 434

Francisco Sensone, App'lt, v. Williams A. Alexander et al., Resp'ts.

(Supreme Court, Appellate Term, First Dept.,

Filed March 23, 1896.)

Headnote

Negotiable Instrument — Order on Agent—Acceptance and Transfer.

An order given by a landlord to an ag-ent for the collection of rent, directing him to pay to bearer rent due on a certain date, is an equitable assignment of such rent; and when the order is accepted by the agent, and transferred to a third party for value, it is irrevocable, and the holder has the right to recover upon it against, the acceptor.

Appeal from a judgment in favor of defendants.

The action was brought against the defendants as acceptors of the following statement:

“Alexander & Alexander, Real Estate and Loans, 246 Fifth Ave-

(Cor. 28th St.)

“New York, July 24th, 1895.

“My Dear Sir: Please pay to hearer the rent due August 24th, amounting to $38.00. _ . .. Laura V. Brewster.

“We accept this Alexander & Alexander.”

Pierre M. Brown, for app’lt; Russell Lord Tarbox, for resp’ts.

It can he inferred from the evidence that the-defendants were the agents of Mrs. Laura Y. Brewster to collect the rent mentioned in the order; that she drew the order in question, and gave it to her husband, who procured its acceptance by the defendants; that the plaintiff agreed, in her presence, to» advance the amounts to her husband, and received the draft from him; and, before discounting it, took it to the defendants, who-admitted their acceptance, and promised to pay the draft; whereupon plaintiff advanced the money to Mr. Brewster. Plaintiff' presented the draft at maturity, and was told that the rent had been collected and paid over, the day before to Mrs. Brewster-The trial judge dismissed the complaint, holding that Mrs. Brewster had the right to revoke the order, and collect the rent herself, and that defendants were hound to pay it to her, and-could not he held liable upon their acceptance. The plaintiff' contended that the order was an equitable assignment of the rents by Mrs. Brewster to the hearer and his transferee, and was irrevocable.

The position of the plaintiff was undoubtedly correct. The object of the order was to transfer the right to the accruing rents, and no more effective form of assignment could he devised than an order upon the collection agente to pay them over. When this order was accepted and delivered for value, the right to revoke it was gone. Munger v. Shannon, 61 N. Y. 251 , was an action against the acceptor of the following instrument:

p. 435

“Mr. Harrison Shannon: You will please pay to Messrs. Wilken & Hair the amount of a note for $2,000, dated December 31, 1868, and deduct the same from my share of the profits of our partnership business in malting. Note made by myself as principal to the order of myself, and indorsed by ¡Nathan ¡Randall and Herrick Hunger. [Signed] L. A. Gulick, per E. Gulick. January 26th, 1869. Indorsed: Accepted February 6th, 1869. H. Shannon..”

The court held that the paper was not a bill of exchange, but .was an equitable assignment of sufficient of the profits to pay the note, and was irrevocable as soon as assented to by the defendant, so far as to require him to appropriate the profits, if any, to its payment. That order was conditional upon the existence of profits, as the order in this case was conditional upon the collection of rents by the defendants, and the doctrine of the case fully sustains the claim of the plaintiff.

, The judgment should be reversed, and a new; trial ordered, .with costs to the appellant to abide the event.

All concur.

Cases cited

Munger v. Shannon 61 N. Y. 251 N.Y. Comm'n App. p. 434