Holmes v. Evans

• Decision Date: 01 December 1891
• Citation: 129 N.Y. 140,29 N.E. 233
• Parties: HOLMES et al. v. EVANS et al.
• Court: New York Court of Appeals Court of Appeals

129 N.Y. 140

29 N.E. 233

HOLMES et al.

v.EVANS et al.

Court of Appeals of New York.

Dec. 1, 1891.

Appeal from superior court of New York city, general term.

Action by Artemas H. Holmes and another against George S. Evans and another to recover shares of stock claimed to be due from defendants for services as attorneys. Defendants obtained judgment, which was affirmed by the general term. Plaintiffs appeal. Affirmed.

Wm. B. Hornblower, for appellants.

John C. Tomlinson, for respondents.

ANDREWS, J.

There is authority tending to support the claim that by force of the agreement of March 24, 1890, there was an equitable assignment by the defendants to the plaintiffs of an interest, to the extent specified in the agreement, of the claim of the defendants against Lippincott. Fairbanks v. Sargent, 104 N. Y. 108, 9 N. E. Rep. 870; Williams v. Ingersoll, 89 N. Y. 508. An equitable assignment has been defined to be such an assignment as gives the assignee a title which, although not cognizable at law, equity will recognize and protect. Such an assignment passes an immediate equitable interest in the subject, although it is not essential to the creation of the interest that it should be immediately enforceable by suit for specific performance to recover the interest assigned. Whether, in a given case, the transaction amounts to an equitable assignment, depends to a great extent upon the intention. Where the transaction is evidenced by a written agreement, it depends upon the intention of the parties as manifested in the writing, construed in the light of such extrinsic circumstances as under the general rules of law are admissible in aid of the interpretation of written instruments. It has been said that, ‘to make an equitable assignment, there must be such an appropriation of the subject-matter as to confer a complete and present right upon the party intended to be provided for, even where the circumstances do not admit of its immediate exercise.’ SWAYNE, J., Christmas v. Russell, 14 Wall. 69. There must undoubtedly be a purpose to pass a present interest, but that interest may be absolute or qualified,-a right to the immediate possession and enjoyment, or a right to such enjoyment postponed until the occurrence of some future event. In other words, the assignment may be made subject to limitations, conditions, and qualifications, such as might be inserted in the conveyance or assignment of the legal estate in the same subject. The quality of the equitable estate is that, and that only, which the parties intended. The language of the agreement of March 24, 1890, is consistent with an intention on the part of the defendants to give the plaintiffs an equitable interest in the subject of the litigation; and the circumstances confirm that construction. The case was complicated, and perhaps doubtful. The defendants had no means to carry on the proposed litigation, and the plaintiffs could not reasonably have expected to receive compensation for their services and disbursements except through the fund or property which might be recovered in the action. They therefore, on their part, agreed to conduct proceedings and suits, ‘and, so far as lies in their power, to carry said proceedings and suits to a successful and final issue and recovery;’ and the defendants agreed that the plaintiffs ‘shall receive, upon settlement or recovery of said claims,’ (against Lippincott,) a specified percentage of ‘such recovery or settlement in kind;’ the defendants reserving the right, ‘within sixty days, to substitute a reasonable cash fee ‘for the services of the plaintiffs in the place of such proportionate part of the claims recovered or settled for as before provided. The fical clause of the agreement provides for a division by the plaintiffs between the two defendants of all stock, cash, and property settled for or recovered, after the plaintiffs shall have set aside their portion under the agreement; and it is stated that the allowance to the plaintiffs shall cover all disbursements. This was not an agreement to pay the plaintiffs out of the fund to be recovered. It was an agreement, in effect, that they should have a share in the claims, and that, when realized, the fund should be divided between ...