Watson v. City of Philadelphia, No. 214

No. 214 | Pennsylvania Court of Common Pleas, Philadelphia County | May 4, 1891

Opinion,

Mr. Chief Justice Paxson :

This case is free from difficulty. The plaintiff, William C. Watson, entered into a contract with the city of Philadelphia to supply clay for the East Park reservoir at a price agreed upon. At the same time he entered upon another contract with the city to grade Montgomery Avenue. He defaulted upon the latter contract, and the city seeks to set off, against his claim under the East Park reservoir contract, the damages sustained by reason of his default' on the Montgomery Avenue contract.

The right to such set-off would seem to be clear, under the authorities. It was decided in Hunt v. Gilmore, 59 Pa. 450" court="Pa." date_filed="1868-11-10" href="https://app.midpage.ai/document/hunt-v-gilmore-6233385?utm_source=webapp" opinion_id="6233385">59 Pa. 450, that imliquidated damages, arising ex contractu from any bargain, may be sot off under the defalcation act of 1705, whenever they are capable of liquidation by any known legal standard. This is settled law.

It appears, however, by the case stated, that the plaintiff executed and delivered to Elder, the use-plaintiff, a power of attorney authorizing him to demand and receive from the city of Philadelphia “all moneys due and owing said Watson on account of said contract,” (East Park reservoir contract,) and that on the faith of it Elder advanced to Watson the sum of $5,560. This sum was probably advanced by Elder to enable Watson to complete his contract to furnish the clay, although such fact does not appear in the case stated. It was contended that this paper operated as an assignment of the contract, and an equitable assignment of the fund due from the city to Watson. That it was neither is too plain for argument. Watson had no power to assign or sub-let the contract. Such transfer was expressly prohibited by its terms. The power of attorney was a mere authority to receive the money due under the contract at its date. It was doubtless intended to cover all money due and to become due under it, but it does not say so. There was nothing upon its face to convey notice to the city that Elder had any interest in it beyond the collection of the money for his principal. It was not an equitable assignment of the fund; hence the question of notice to the city, and whether it was of the whole or only of a part of’ it, becomes immaterial, and we need not discuss the cases which hold that a municipality is not bound to recognize an assignment of a part only of a particular fund.

The recent case of Clement v. Philadelphia, 137 Pa. 328" court="Pa." date_filed="1891-01-05" href="https://app.midpage.ai/document/clement-v-city-of-philadelphia-6240047?utm_source=webapp" opinion_id="6240047">137 Pa. 328, i& directly in point. Clement, while indebted to the city, entered into a contract with it to do certain work. He immediately agreed with Josephs to advance him (Clement) the money to complete his contract, and assigned his right to receive the payments as they became due. Josephs was to deduct his advances and one half of the net profits. He received some payments, but less than his advances. In an action by Clement, to the use of Josephs, it was held that the city had a right to set off the balance on account of the original indebtedness of Clement, notwithstanding the assignment. That case was even stronger than this, for the reason that Josephs held an irrevocable power of attorney to collect the money, while Elder’s authority could have been revoked at any time. Upon all other points the cases are similar. The fact that in the one case the set-off was for an indebtedness prior to the contract, and in the other an indebtedness for breach of a concurrent contract, is ,a distinction without a difference.

Judgment affirmed.