United States Trust Co. v. Blundon ( 1914 )

Mr. Chief Justice Shepard

delivered the opinion of the Court:

1. The assignments of- error raised the question of equity jurisdiction.

2. The holding of the court that there was any consideration shown for the agreement alleged with plaintiff’s counsel, that the bank would not sell the promissory note of Snowden which had been attached to the collateral note of Blundon.

3. In finding as the fact that there was an agreement between the Fourteenth Street Savings Bank and the plaintiff by which the interest on the Snowden note would be allowed to pay the principal and interest on the Blundon note or any agreement as testiijed to by plaintiff’s counsel.

1. The objection to the jurisdiction of equity came at a late stage in the proceeding. It was not raised by motion to dismiss, but reserved until the evidence had been heard and the argument begun. The allegations of the bill and prayers for relief bring it within the class of cases in which equity has always exercised jurisdiction. In addition to the discovery prayed and the accounting, a temporary injunction was prayed and granted to restrain a negotiation of the undue negotiable note, the recovery of which was sought. This relief equity alone can grant. The objection comes too late to require an analysis of the evidence to determine whether there was a complete and adequate remedy at law. Tyler v. Moses, 13 App. D. C. 428, 442.

2. The pledgee had the right to waive the sale by which the rights of the pledgeor were forfeited, and such waiver requires no new or independent consideration to support it. Toplitz v. Bauer, 161 N. Y. 325, 335, 55 N. E. 1059; Knickerbocker L. Ins. Co. v. Norton, 96 U. S. 234, 240, 24 L. ed. 689, 691.

Having waived the forfeiture, the defendant could not lawfully exercise the power of sale without notice to the plaintiff. An attempt was made to show that such notice had been given by letter a month before the sale was made. Plaintiff testified positively that no such letter had been received. Defendant’s proof failed to show conclusively that such letter was in fact mailed. It produced a carbon copy of a letter addressed to plaintiff and testimony tending to show that it was placed among other letters in a receptacle to be mailed. It was the custom so to do, and messenger boys employed in the bank were accustomed to take the letters from the receptacle, and carry them to the mail box. It does not appear that the letter when deposited in the receptacle was in an envelop addressed to plaintiff and stamped. Moreover, the waiver had been by agreement with the attorney of plaintiff, who lived in the city, and whose telephone address was known, to the officers of the defendant, and yet no effort was made to notify him that the sale would take place. On the day of sale, the note was simply indorsed to the cashier of the bank, who immediately discounted it to the bank, receiving the surplus after the discharge of the indebtedness wbicb the note secured. The sale was in violation of the agreement, and passed no title. While the defendant claims in its answer that it had purchased the note before maturity, for value, and without notice, it was admitted on hearing and so recorded in the final decree, that the defendant took the transfer of the note with the promise to assume any and all liability that might be proved or established against the Fourteenth Street Savings Bank, thus disposing of its claim of purchase without notice.

3. The testimony concerning the making of the agreement to waive the forfeiture was in conflict. The court who heard the witnesses was satisfied that it had been made. We cannot say from the statement of the evidence that he erred in this finding of fact. The decree is affirmed, with costs. Affirmed.