First Nat. Bank of Newport v. Hunton

• Citation: 46 A. 1049,70 N.H. 224
• Court: Supreme Court of New Hampshire
• Decision Date: 16 March 1900
• Parties: FIRST NAT. BANK OF NEWPORT v. HUNTON et al.

46 A. 1049

70 N.H. 224

FIRST NAT. BANK OF NEWPORT

v. HUNTON et al.

Supreme Court of New Hampshire. Sullivan

March 16, 1900.

Exceptions from Sullivan county.

Suit by the First National Bank of Newport against Alice E. Hunton and others. A motion to dismiss the bill was denied, and defendants except. Exceptions overruled.

Bill in equity. Facts found by the court: Prior to February 24, 1896, the defendant Edwin M. Hunton and one Barker, being partners in business under the firm name of Hunton & Barker, dissolved the partnership upon the agreement that Hunton should have its assets and pay its indebtedness, including the firm's note of $1,500 to the plaintiff. On that date Hunton's wife, Alice, made and executed to the plaintiffs her note for $1,500, and took up the partnership note for that amount. Subsequently, and as a part of this transaction, Edwin gave to his wife a note for $1,500. Edwin continued the business, but was unsuccessful, and July 16, 1896, filed his petition in insolvency, naming among his creditors Alice, who made due proof of her claim upon the $1,500 note. Edwin made an agreement or compromise with his creditors proving their claims, whereby they were to accept 60 per cent. of their claims in full discharge thereof. Alice signed this agreement and a receipt for her 60 per cent., but did not in fact receive any money. To carry out this agreement, Edwin obtained a loan from the defendant Rawson upon a written agreement by which he was authorized to take possession of Edwin's assets, sell them, and reimburse himself for the loan and expenses, and to pay any balance to Edwin. Rawson, after reimbursing himself in accordance with the agreement, had remaining in his hands $500. In consideration of the above facts, Edwin gave Alice an order on Rawson for the payment to her of such sum, which he has accepted, but not paid. Until after the acceptance of the order, both Edwin and Alice understood that her note to the plaintiffs was valid. August 20, 1896, Edwin obtained his discharge in insolvency. He did not name the plaintiffs in his list of creditors. They did not understand they were creditors until long after the termination of the insolvency proceedings, proved no claim against him, were not parties to the proceedings or to the agreement for compromise, and have not received anything in payment upon their claim. Barker is financially Irresponsible, and has been so since the dissolution of the partnership. Subsequently to the discharge in insolvency, the note of Alice to the plaintiffs has been held invalid, as being an undertaking in behalf of her husband. Bank v. Hunton (N. H.) 45 Atl. 351. Since the service of this bill upon the defendants, Edwin's mother, Mary A. Hunton, brought suit against him, and summoned Rawson as trustee, and the action is now pending. At the time of the execution of the note by Alice to the plaintiffs, she held two insurance policies upon the life of Edwin,—one, for the sum of $2,000, payable to Edwin or his assigns at the end of 20 years from its date, or, in the event of his prior death, to Alice, his wife, or, if she is not living, to the executors, administrators, or assigns of Edwin; the other, for $3,000, payable to Alice in case she be living at the death of Edwin, otherwise to the executors, administrators, or assigns of Edwin. Both policies were obtained upon the written application of Edwin, who has paid the premiums and assessments thereon. Both policies were, May 29, 1896, with the assent of the insurers, assigned to the plaintiffs by Alice and Edwin as collateral security for the $1,500 note of Alice, and the plaintiffs now have possession of the policies. These facts appearing in the bill, the defendants' motion to dismiss on the ground that the bill disclosed no claim against the defendants, or either of them, was denied, subject to exception. The court held that the plaintiffs were entitled to an accounting with Rawson, and to a decree for the payment to them of such sum as...