Roca v. Byrne

• Decision Date: 26 February 1895
• Citation: 39 N.E. 812,145 N.Y. 182
• Parties: ROCA et al. v. BYRNE et al.
• Court: New York Court of Appeals Court of Appeals

145 N.Y. 182

39 N.E. 812

ROCA et al. v. BYRNE et al.

Court of Appeals of New York.

Feb. 26, 1895.

Appeal from supreme court, general term, First department.

Action by Francisco Roca and Arthur Henriques against Anna D. Byrne, as executrix, and the Corn Exchange Bank. From an affirmance by the general term (22 N. Y. Supp. 1039) of a judgment for plaintiffs, defendant Anna D. Byrne appeals. Affirmed.

The action is brought against the executrix of Daniel Byrne, deceased, and the Corn Exchange Bank, to obtain a judgment directing the latter to pay to the plaintiffs certain moneys standing to the credit of the deceased claimed by them to be the proceeds of certain drafts transmitted to the deceased as their agent, and to have been received by him in such fiduciary capacity. The following were the facts: The plaintiffs were copartners carrying on business under the firm name of Roca & Henriques, at Guayaquil, Ecuador. In February, 1888, Daniel Byrne became their agent in New York City, and continued as such until his death, on August 2, 1891. The plaintiffs were accustomed to consign merchandise to Byrne for sale, the proceeds of which were credited to the account of the principals. Byrne also purchased goods at the city of New York for and shipped them to the plaintiffs, which were paid for by the avails of goods consigned to and sold by Byrne, and by bills of exchange sent to him by the plaintiffs. The plaintiffs were also accustomed to draw bills on Byrne, which he accepted, paid, and charged to their account, and interest was charged on the balances against whichever party happened to be the debtor. Every six months the account was settled. On June 30, 1891, a settlement was had of all unsettled matters, and a balance of $24,953.63 was found to be due to Byrne. Six bills, amounting to $9,721.58, drawn by plaintiffs, accepted by Byrne, and charged in the account of June 30th, fell due after that date, but were not paid by Byrne, and were thereafter paid by the plaintiffs, which reduced their indebtedness to him to $15,232.05. Between June 20 and August 1, 1891, the plaintiffs sent Byrne nine bills, drawn on various persons and firms, amounting to $18,313.69, which he and his representative received and collected, so that the balance due from his estate when this action was begun was $3,081.64. During the period covered by the transactions involved in this litigation, Byrne kept an account with the Corn Exchange Bank, to the credit of which all his own money, as well as the avails of merchandise and bills of exchange received from the plaintiffs, were deposited, and against which he drew for his own account and benefit, and also in conducting the business of the plaintiffs. On July 25, 1891, Byrne received from the plaintiffs two bills of exchange, amounting to $2,774.26, which on that day he deposited in said bank to the credit of his account. On July 30, 1891, he received from plaintiff a bill of exchange for $2,000, which, on the same day, he deposited in said bank to his credit. On August 2, 1891, Byrne died insolvent. On August 5, 1891, some person claiming to act for the estate of Byrne received from the plaintiffs a bill of exchange for $440, the avails of which, amounting to $439.63, were on the same day deposited to the credit of said account in said bank, and on August 31, 1891, some person claiming to act for the estate of Byrne received from the plaintiffs a bill of exchange for $600, the avails of which were on the same day deposited to the credit of said account in said bank. The bills described, aggregating $5,313.89, were four of the nine bills which aggregated $18,313.69. When the action was commenced, the balance of $4,514.05 in the defendant bank to the credit of the deceased, or of his estate, was derived from the four above-mentioned bills of exchange. The plaintiffs had judgment in their favor at the special term, which was affirmed on appeal to the general term, and the defendant appeals to this court.

PRINCIPAL AND AGENT-FOLLOWING TRUST FUNDS.

Defendant's intestate was for several years before his death the New York agent of plaintiffs, who were foreign merchants. On a settlement, 60 days before intestate's death, plaintiffs were indebted to him. Three days before his death he received two bills of exchange from plaintiffs, which he deposited in a certain bank, and a few days after his death, persons claiming to represent his estate received two other bills of exchange from plaintiffs, which were deposited in the same bank. The receipt of these bills, together with bills previously received, overpaid the indebtedness of plaintiffs. held, that the deposit in the bank was affected with a trust in favor of plaintiffs, to the amount of such overpayment by them, as against other creditors of intestate. 22 N. Y. Supp. 1039, affirmed.

Theron G. Strong, for appellant.

Michael H. Cardozo, for respondents.

GRAY, J. (after stating the facts).

This is a somewhat peculiar case upon its facts, and the question is whether the plaintiffs, having traced the avails of the drafts which they had remitted to their agent, shall have them, as against the claims of other creditors upon the insolvent estate of Byrne. The general and well-recognized rule is, and has been, that a principal is entitled in all cases, when he can trace his property, whether it be in the hands of the agent, or of his representatives, or of third persons, to reclaim it; and it is immaterial that it may have been converted into money, so only that it is in condition to be distinguished from the other property or assets of the agent. Story, Ag. § 231; Thompson v. Perkins, 3 Mason, 232, Fed. Cas. No. 13,972; Robson v. Wilson, 1 Marsh. Ins. 295; Van Alen v. Bank, 52 N. Y. 1;Bank v. Peters, 123 N. Y. 272, 25 N. E. 319. The difficulty here supposed to prevent the application of the general rule arises in the nature of the course of dealing adopted, which, as it is argued on behalf of the appellant, shows that the relation of debtor and creditor only existed between the plaintiffs and their deceased agent. The moneys, it is insisted, proceeding from the drafts remitted to Byrne, were not impressed with any trust, but were in part payment on...