Braem v. Merchants' Nat. Bank
|28 N.E. 597,127 N.Y. 508
|BRAEM et al. v. MERCHANTS' NAT. BANK.
|06 October 1891
|New York Court of Appeals
OPINION TEXT STARTS HERE
Appeal from supreme court, general term, fourth department.
Action on the case by Henri M. Braem and Albert Tower against the Merchants' National Bank of Syracuse. From a judgment of nonsuit at the trial, plaintiffs appealed to the general term, where the judgment was affirmed. Plaintiffs appealed. Affirmed.
Wm. C. Holbrook, for appellants.
Wm. G. Tracy, for respondent.
STATEMENT BY THE COURT. On October 7, 1884, the plaintiffs recovered a judgment in the city court of New York against the Syracuse Iron-Works, a corporation having its place of business at the city of Syracuse, for $1,798.38, which was docketed in Onondaga county, and execution issued upon it delivered to the sheriff of that county the day following. On October 7, 1884, Mary E. Gere recovered against the Syracuse Iron-Works a judgment for upwards of $12,000, execution upon which was delivered to such sheriff at 2:10 P. M. of that day. Those two judgments were recovered in due course of proceedings in actions. On the same 7th day of October the Merchants' National Bank of Syracuse, the defendant, obtained judgment against the iron-works for upwards of $15,000, and execution upon it was delivered to the sheriff at 4:30 P. M., and he on that day levied the two last-mentioned executions upon the personal property of the iron-works. On the 15th day of October, 1884, he sold the property, and, after satisfying the execution issued upon the Gere judgment, he applied the residue of the proceeds of the sale, amounting to $13,671.86, upon the bank execution; and on the 27th of that month the sheriff returned the plaintiffs' execution nulla bona. The defendant's judgment was taken upon the acceptance of an offer to allow it in an action commenced on the day of its entry. This action was brought to recover damages alleged to have been sustained by the plaintiffs by the unlawful and wrongful acts of the defendant. The trial court directed a nonsuit.
The relief sought by this action at law, as appears by the complaint, was founded upon the charge that the defendant, intending to injure the plaintiffs, and to prevent their having satisfaction of their judgment, wrongfully, collusively, and fraudulently commenced its action, and, by collusion with the officers or agents of the Syracuse Iron-Works, obtained its offer to allow it to take judgment therein, accepted it, and caused judgment to be entered and execution to be issued and levied upon the property of the iron-works; and that with the like intent afterwards wrongfully caused the property to be sold by virtue of such execution issued upon the judgment, which, having been so obtained in fraud of the statute, was void, by reason whereof the lien of the plaintiffs upon the property was defeated, lost, and destroyed. And for the support of the action the plaintiffs relied upon the statute which provides that, ‘whenever any incorporated company shall have refused payment of any of its notes or other evidences of debt, * * * it shall not be lawful for such company, or any of its officers, to assign or transfer any of the property or choses in action of such company, directly or indirectly, for the payment of debt; and it shall not be lawful to make any transfer or assignment in contemplation of the insolvency of such company to any person or persons whatever; and every such transfer and assignment to such officer, stockholder, or other person, or in trust for them or their benefit, shall be utterly void.’ 1 Rev. St. p. 603, § 4. The purpose of the statute was to deny to insolvent associations the right to give preference to any of its creditors, or, in contemplation of insolvency, to transfer its property. When the defendant proceeded to take judgment against the iron-works the commercial paper of that company had been protested, and the company was insolvent; and it may be assumed that the offer of judgment to the bank was made to gives it an unlawful preference; and, so far as it could be, it was accomplished by the judgment entered upon the acceptance of the offer and the issuing of execution to the sheriff, and the preference sought by the iron-works to be given the defendant was in violation of the statute. Kingsley v.Bank, 31 Hun, 329; Throop v. Hatch Lith. Co., 125 N. Y. 530, 26 N. E. Rep. 742. The only question essentially for consideration on this review is whether the plaintiffs were entitled to relief in this action at law; and for that purpose the cause of action, as alleged in the complaint, cannot here be modified. They had a judgment properly recovered against the company. It was docketed in Onondaga county, and execution upon it issued to the sheriff the day following that on which the defendant's judgment was docketed and execution upon it issued to the sheriff; and on that day there was also an execution, the first that came to his hands, upon Mary E. Gere's judgment against the iron-works, levied upon the property. The validity of this judgment is not questioned. At the time of the commission by the iron-works company of the unlawful act complained of, the plaintiffs had no lien upon the property. When their execution came to the sheriff, the property was in his custody, and, unless otherwise directed, he would necessarily apply the proceeds of its sale upon the executions in the order they were received by him. Code, § 1406; Peck v. Tiffany, 2 N. Y. 451. This sale was lawfully made by the sheriff on the 15th of October, and in...
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Strachman v. the Palestinian Auth.
...further contend that this interpretation of Quinby was adopted by the Court of Appeals in Braem v. Merchants' Natl. Bank of Syracuse, 127 N.Y. 508, 28 N.E. 597  and by this Court in James v. Powell, 25 A.D.2d 1, 266 N.Y.S.2d 245 , revd. 19 N.Y.2d 249, 279 N.Y.S.2d 10, 225 N.E.2d......
American Sur. Co. of New York v. Conner
...equitable asset, equity would not act except upon a showing that execution had been returned unsatisfied. Braem v. Merchants' National Bank of Syracuse, 127 N. Y. 508, 28 N. E. 597;First National Bank of Amsterdam v. Shuler, 153 N. Y. 163, 47 N. E. 262,60 Am. St. Rep. 601. On the other hand......
Field v. Bankers Trust Company
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James v. Powell
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