Addison v. Enoch ( 1900 )

Ingraham, J.:

The action is in equity, and brought to enforce an alleged equitable lien upon a certain sum of money due to the defendant Rosa Enoch from a benevolent association, payable upon the death of her husband, Edward Enoch. The plaintiff claims that an 'equitable assignment or an equitable lien was created by an instrument in writing signed by the defendant Rosa Enoch, the appellant. This instrument is dated New York, January 23, 1889, and is as follows:

“ After death of Edward Enoch we, or either of us, promise to pay to the order of A. Wolfson four hundred and fifty ($450) dollars, without interest, payable from the endowment fund either of the Bnai 'Brith Lodge or Kesher Shel Barzel Lodge, and no other source.

“ $450. (Signed) ROSA ENOCH,

“ JOS. E. ENOCH.”

The plaintiff claims, and the court below found, that this instrument operated as an equitable assignment of the fund due from either of the associations named to the extent of $450, and was valid in equity; and it gave judgment for the plaintiff, directing the payment to him of the sum of $500, payable by one of the associations to the appellant.

The instrument is purely executory. There was no intention expressed to transfer anything to the plaintiff’s assignor, or to create any lien upon any particular fund. The makers of the instrument agreed to pay at a future date a sum of money to the plaintiff’s assignor, and that such payment should be made out of a particular fund ; and as they could not make the payment out of that particular fund until it was received by the makers, no payment was due to the plaintiff’s assignor until the fund was received. The instrument did not purport to transfer or assign the fund, nor did it authorize the par-ee to collect the fund from the corporation or indi: vidual who held It for the benefit of the makers. The instrument ■was simply a promise to paj7 a sum of money upon. the happening of the.contingency named out of a particular fund when it should be received by the makers of the instrument, that promise being executory; and no right was granted to the payee to enforce the payment in any way, except as a personal promise of the makers. This question as to the nature of the instrument has a most important bearing upon the rights acquired by the parties to it. A purely executory contract by which the promisor agrees to do a particular thing, upon the happening of a particular contingency, imposes different obligations and creates different rights from those under an instrument which was intended to transfer a present right upon the execution of the instrument, to grant a specific lien upon or operate as an assignment of specific property, or to transfer the right to receive specific property, or a demand when it should accrue to the promisor.

There is in this case nothing but a personal promise of the obligor to pay a sum of money to the payee.' The utmost that can be claimed is that this promise was to pay a sum of money to the payee out of a particular fund when it should be received by the obligors, but such an agreement is not sufficient to create either an equitable lien upon the fund, or to operate as an assignment thereof. For that proposition the case of Williams v. Ingersoll (89 N. Y. 518) is authority. As was said by Eabl, J., in delivering the opinion of the court: “ Nor can the plaintiffs base their claim to an equitable lien upon the award upon the mere promise of Heath that they should be paid out of any money that should be recovered in .any of the actions or proceedings. Whatever the law may be elsewhere, it must be regarded as the settled law of this State, that an agreement, either by parol or in writing, to pay a debt out of a designated fund does not give an equitable lien upon the fund, or operate as an equitable assignment thereof.” The cases relied on by. the plaintiff, of which, Brill v. Tuttle (81 N. Y. 454) is an example, do not apply, for there the instrument relied on was an order upon a person who was a debtor of the drawer of the order, requesting such person to pay to the payee named a sum of money out of the amount due to the drawer for work done under a contract with the drawee ; and it was held that such an order operated as an equitable assignment pro tanto of the amount due by the payee to the drawer of the instrument. The court in that case' said: “ The direction in the order to charge the money to be paid thereon to that account, indicates, we think, sufficiently, in connection with the surrounding circumstances, that the payments were to be made out of the moneys due, or to become due, on the account, and all parties must have so understood it. If such is its true construction, it was an assignment of the fund within all the authorities.” Such an instrument, therefore, acted as a present transfer of a fund due, or to grow due, and is entirely distinct from a mere executory promise to pay a sum of money by the promisor out of a particular fund.

We think, therefore, that the instrument in question did not create an equitable lien upon any sum of money to become payable in the future by either of the associations named, nor could it operate as an equitable transfer of such money.

There is another objection to the recovery in this case which is also fatal to the judgment, and that is, that it was clearly proved that there was no consideration for the promise in question. The makers of, the instrument were not indebted to the plaintiff’s assignor. Nor did the plaintiff’s assignor part with any right of property upon the execution or delivery of this instrument. The instrument was, as before stated, purely executory and contained a simple promise to pay in the future a sum of money. ' The instrument was not negotiable ; no consideration, was expressed ; none, in fact, existed. In Alger v. Scott (54 N. Y. 14) it y;as expressly held that a consideration was necessary to support such a promise. There Gray, C., delivering the opinion of the court, says: “ The cases in this state, from Peyton v. Hallett (1 Cal. 363, 364, 379) down to Parke v. The City of Syracuse (31 N. Y. 376, 379), in which an order, payable out of a specified fund, has been held not to be a bill of exchange requiring an acceptance, but an assignment, of the fund to the payee to the amount specified in the order, were each of them cases where the drawer had received a consideration for the order, and for that reason the order was held to be- an assignment of the fund drawn upon to the amount specified in it. This order was not supported by any consideration.. Its validity is tested by the same rule it would be if not drawn upon a specific fund, and Glover, by reason of the defendants’ refusal to accept it, had brought his action against the plaintiff to recover its amount. In such a case, the want of consideration would defeat,1 as it rightfully did in this case.”

It follows that the judgment appealed from must be reversed, with costs; and as this .action was in equity, and there was'a short decision under section 1022 of the Code, this court can grant to either party the judgment which the facts warrant. As it clearly appears from the conceded facts that the plaintiff can have no cause of action in equity to enforce this agreement, it seems useless to' order a new trial. The complaint, therefore, should be dismissed, with costs.

Patterson, J., concurred; Van Brunt, P. J., concurred in / result; O’Brien and McLaughlin, JJ., dissented.