Savage v. Gregg

May 8, 1894
Versions:
Mr. Justice Ceaig

delivered the opinion of the Court:

It is not claimed that the assignment of the claim which Savage made to Gregg was fraudulent, or made for the purpose of preventing the creditors of Savage from reaching the fund to be collected from the bank, but, on the other hand, it is apparent that Gregg took and held the assignment for the purpose of securing a bona fide indebtedness due and owing from Savage to him. The controversy is, therefore, one between creditors, and it is first claimed by counsel for appellant that John Q. Savage never had or passed the legal or equitable title to any chose in action against the bank, — in other words, he had no assignable interest in the claim against the bank, — and hence the pretended assignment to Gregg passed no title or interest in the fund ultimately collected by Dent & Black from the bank. We do not concur in this view. George W. Savage held a claim against the First National Bank of Monmouth. An arrangement was made between him, Dent & Black, and Cratty Bros., and John Q. Savage, on which a suit was brought on the claim in the name of George W. Savage, for the use of John Q. Savage. Money had to be advanced to prosecute the suit and pay costs and expenses, and John Q. Savage agreed to make the advances. The money was to be collected by Dent & Black, and after deducting certain expenses and fees, the residue was to be paid, one-half to George W. Savage and the other half to John Q. Savage. Under this arrangement John Q. Savage became the equitable owner of one-half of the claim against the bank, which he had the right to prosecute to final judgment, and after the money should be collected, if Dent & Black had refused to pay it over to him, no reason is perceived why he could not maintain an action in his own name to recover the money. Here was a valid, subsisting interest, — one which might properly be transferred or assigned to another, at least in equity, so as to enable the assignee to collect the proceeds of the claim:

Capes v. Burgess, 135 Ill. 67, cited by counsel, does not seem to sustain their view of the question. What claims might be assigned did not arise in that case and was not decided. The question there was as to the nature of the claims which might be attached or garnisheed.

It is also claimed that the assignment of the claim was never accepted by Dent & Black or the bank, and upon this ground Gregg is not entitled to hold the money, and in support of this position we are referred to First Baptist Church v. Hyde, 40 Ill. 150. An examination of the case cited will establish the fact that the question there involved was entirely , different from the one presented by this record. There an order for a certain sum of money was drawn by a contractor on a church, which the church never accepted, and it was held that the order did not constitute a transfer of the debt to the payee of the order. If Gregg had received an order from Savage on Dent ás Black, for a certain sum of money, and Dent & Black had refused to accept the order, the case cited might be relied on as authority to support appellant’s position. But no order was given in this ease, and no question in regard to an order is involved. Here, Savage held a claim against a bank. He had a suit pending to recover the amount of his demand, and he assigned his entire interest in that demand to "William M. Gregg, and after the assignment Gregg was recognized by Dent & Black, in whose hands the demand had been placed for collection, as the owner of the claim, and at the request of the attorneys he advanced money to assist in the collection of the claim. Prom the time the assignment was made, whatever interest Savage had in the claim passed at once to Gregg.

Reeve v. Smith, 113 Ill. 47, has also been cited as an authority for appellant. There the construction of section 37 of the Attachment act arose, and it was merely held that two judgments rendered at the same term of court were entitled to share pro rata in the proceeds of property attached or garnisheed, although one of the actions had been instituted after the attaching debtor had transferred, by assignment, the claim garnisheed, to another creditor. The decision in that case can have no bearing here.

Ray v. Faulkner, 73 Ill. 469, has also been cited, but that case merely holds that the acceptance by a debtor .of an order drawn upon him by his creditor, in good faith, before the service of garnishee process, makes him no longer the debtor of the drawer, and hence not liable to be garnisheed by his creditors. But the case does not hold that a claim may not be sold and assigned in good faith, and thus pass beyond the reach of garnishee process.

We do not think, where the entire claim or demand has been sold and assigned, as was done in this case, any formal acceptance was required on behalf of Dent & Black, — the parties who were to collect and distribute the demand against the bank. It may be conceded that the claim or demand held by Savage against the bank was not assignable at law, but that would not prevent Savage from making an equitable assignment of the claim, which may be protected and enforced in a court of law. This court is fully committed to that doctrine. In Morris v. Cheney, 51 Ill. 451, in discussing the question, the court said: “The doctrine is well settled that courts of law will recognize and protect the right of the assignee of a chose in action, whether the assignment be good at law or in equity only, and in Carr v. Waugh, 28 Ill. 418, this court said, that in equity all contracts and agreements may be .assigned and will be protected, and the interest of the assignee will constitute a defense to a proceeding in garnishment. * * * Even if there was no formal written assignment of this claim, nothing is shown to prove a sale of it by a person authorized to make it, and it has not been repudiated by the parties in interest. It is true, a debt, or chose in action is not generally assignable in law, except in the case of negotiable instruments, and for. that reason the assignee is ordinarily compelled to seek redress against the assignor and debtor solely in. courts of equity.” So in Hodson v. McConnell, 12 Ill. 170, it is said: “The doctrine is well settled that courts of law will notice and protect the interests of the equitable owners of choses in action, and particularly so in the matter of a garnishee proceeding, which is of an equitable character.” See, also, Dressor v. McCord, 96 Ill. 389.

In order to constitute a valid assignment of a debt or other chose in action, in equity, no particular form of words is necessary. Any words are sufficient which show an intention of' transferring or appropriating the chose in action to the assignee for a valuable consideration. 1 Am. and Eng. Ency. of Law, 834, and cases cited in notes.

The judgment of the Appellate Court will be affirmed.

Judgment affirmed.