30 N.J. Eq. 171 | New York Court of Chancery | 1878
The instrument which gives rise to this suit is in these words :
“This is to certify that, in consideration of a $1,000 bond on the town of Harrison, to me in hand paid by Freeman Bower, of the town of Harrison, Hudson county, New Jersey, I, Daniel M. Lyon, treasurer of the Hadden Blue Stone Company, do hereby agree to assign, transfer and set over unto the said Freeman Bower such an interest in the judgment obtained by the Hadden Blue Stone Company against James B. Smith, of the town of Harrison, in the supreme court of the state of New Jersey, for the sum of $2,501.59, besides costs of suit, on the 24th day of November, 1873, as will secure to said Bower the repayment of the sum realized by me on said bond, paid by him as aforesaid, on account of the aforesaid judgment against said James B. Smith. Witness my hand, this 17th day of December, 1873. Daniel M. Lyon, treasurer.”
It is admitted that $900 was realized oh the bond. It also appears that in April or May, 1874, a debtor of James B. Smith (the judgment debtor) paid to the defendant Lyon, on account of the judgment, the sum of $443.56, and that on the 18th of June, 1874, Smith’s real estate was sold, under the judgment, for $1,700, making the sum total realized $3,043.56. With costs added, the total amount of the judgment, at the date of its recovery (November 24th, 1873) was $2,539.35. The real estate was struck off to Mr. Lyon. He says he purchased for the plaintiff. His signature to the memorandum of purchase has the word “ treasurer” written under it. The sheriff conveyed the property to him, but he says this was done pursuant to an agreement subsequently made by the corporation and himself, by which it agreed to sell him the land for $100 less than the amount of his bid. He also says he has paid to the corporation all the money he received on the judgment. He was its treasurer, also a director, and the owner of two-fifths of its stock. At the time he paid the purchase-money of the land, he admits the corporation was badly crippled. He says it was indebted to him in the sum of $17,000 or $18,000, and had sunk more than three-fourths of its capital. With a
Three questions were discussed on the hearing: Eirst, is the complainant in the proper forum; second, does the contract give the complainant the right to be first paid out of the moneys realized on the judgment; and, third, is the defendant Lyon liable to the complainant for any part of the purchase-money of 'the land purchased by him.
On the argument, it was admitted that the defendant Lyon had authority to bind the corporation by the contract of December 17th, 1873. ’Without such concession or proof showing that he was specially empowered, I think it is quite clear the contract could not be regarded as the act of the corporation. It was, in effect, a borrowing of money by pledging the property of the corporation, and this, in my view, the treasurer of such a corporation would have no power to do in virtue of his office or employment. To make it the act of the corporation, special authority would have to be shown.
I think it is entirely clear, the complainant has a right to a remedy in equity. His contract is not an assignment, but merely gives him a right to an assignment. His title, therefore, is purely equitable. Without an actual assignment or legal title, a court of law is powerless to give him any aid; but equity disregards mere form; if the right exists, even if it is not formally manifested, it will afford both remedy and relief. In equity no particular form is necessary; any writing, or even an act, which plainly makes an appropriation of the fund or property, will be esteemed an assignment. 2 Story’s Eq. Juris. § 1047; Galway v. Fullerton, 2 C. E. Gr. 389.
Nor do I think there can be the slightest doubt about what the contract means. It was drawn by the counsel of the
Can the complainant hold the defendant Lyon for any part of the purchase-money of the land ? The purchase-money was not paid to the sheriff; if paid at all, it was paid either to the corporation, its creditors or stockholders. It is impossible to say to whom it was paid, or whether it was paid at all. The defendant’s evidence on this point is confused and contradictory. It is clear, a payment to the corporation did not constitute a payment to the complainant. Their rights were several and not joint—the complainant occupied a position of superior right,—hence a payment to the corporation was not a payment to him. The relation of principal and agent did not exist, either in fact or legal theory. If Mr.-Lyon paid the money to anybody, he paid it with full notice of the complainant’s rights. He nego
The complainant is entitled to a decree against both defendants.