Security Bank of New York v. Callahan

• Decision Date: 07 January 1915
• Citation: 220 Mass. 84,107 N.E. 385
• Parties: SECURITY BANK OF NEW YORK v. CALLAHAN et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

220 Mass. 84

107 N.E. 385

SECURITY BANK OF NEW YORK v. CALLAHAN et al.

Supreme Judicial Court of Massachusetts, Suffolk.

January 7, 1915

Jan. 7 1915.

COUNSEL

Goodwin Procter & Ballantine and Robt. E. Goodwin, all of Boston, for plaintiff.

Gaston, Snow & Saltonstall, of Boston (Thos. Hunt, of Boston, of counsel), for defendants.

OPINION

BRALEY J.

While at common law not only the subject-matter must be in existence and in the actual or potential possession of the assignor, but partial assignments are not recognized, a court of equity will protect and enforce such assignments by beneficiaries under trusts where the right has not been cut off by the testator, and by heirs and legatees of their contingent interest in funds or property, if made in good faith for a valuable consideration, and not contrary to public policy. Low v. Pew, 108 Mass. 347, 350, 11 Am. Rep. 357; Leverett v. Barnewell, 214 Mass. 105, 101 N.E. 75; Trull v. Eastman, 3 Metc. 121, 37 Am. Dec. 126; Jenkins v. Stetson, 9 Allen, 128; Whipple v. Fairchild, 139 Mass. 262, 30 N.E. 89; James v. Worcester, 141 Mass. 361, 5 N.E. 826; Wainwright v. Sawyer, 150 Mass. 168, 22 N.E. 885; Sawyer v. Cook, 188 Mass. 163, 74 N.E. 356; Hinkle v. Wanzer, 17 How. 353, 15 L.Ed. 173; Delaware Co. v. Diebold Safe & Lock Co., 133 U.S. 473, 10 S.Ct. 399, 33 L.Ed. 674; Row v. Dawson, 1 Ves. 331. The assignment held by the plaintiff as collateral security for the payment of certain promissory notes of the assignor clearly comes within this principle. It transferred as between the parties a qualified interest commensurate with the amount of the loans and accrued interest in the share of the estate bequeathed to the assignor. James v. Newton, 142 Mass. 366, 8 N.E. 122, 56 Am. Rep. 692; Richardson v. White, 167 Mass. 58, 44 N.E. 1072. The bill does not refer to the provisions of the will. It alleges only that the assignor is a 'beneficiary' having an unqualified interest or share which we assume to be that of a legatee. The executor in the settlement of the estate would have the right to deal with the legacy as an entirety until informed of the transfer to which it is alleged leged he consented and expressed his willingness to treat the plaintiff as the assignee. If for his own protection the plaintiff gave notice of the assignment, the assent or acceptance by the debtor would and nothing to the bank's title. Buttrick Lumber Co. v. Collins, 202 Mass. 413, 89 N.E. 138; Kingman v. Perkins, 105 Mass. 111.

But as the demurrer admits all the essential allegations, the question referred to but left undecided in James v. Newton, 142 Mass. 366, 8 N.E. 122, 56 Am. Rep. 692, and Richardson v. White, 167 Mass. 58, 44 N.E. 1072, whether in the absence of such assent the executor could have ignored the plaintiff and dealt only with the legatee need not be decided. It is admitted that the executor, after receiving notice, paid to the assignor or on his account all of his share, which was largely in excess of the plaintiff's demands, and having presented his accounts to the court of probate, the final account showing the distribution has been allowed, and no appeal from the decree has been taken. The demurrant and executor contends that this decree bars relief. It is immaterial whether the amount coming to the assignor was paid before or after the estate had been settled. The allowance of the final account under R. L. c. 150, §§ 1 and 2, which must be presumed to have rested upon the preceding accounts, closed the estate as affectually as if a decree of distribution had been asked for and entered under section 19. Rhines v. Wentworth, 209 Mass. 585, 588, 95 N.E. 951. and cases cited; Welch v. Boston, 211 Mass. 178, 182, 97 N.E. 893. The court of probate in a decree of distribution deals only with heirs and legatees, without regard to their assignments or pledges. Lenz v. Prescott, 144 Mass. 505, 515, 11 N.E. 923; Coram v. Davis, 209 Mass. 237, 95 N.E. 298. It is only where the administrator or executor states in his account that payments to heirs or legatees are claimed because of payment to their assignees, that the validity or effect of an assignment can be determined in that court. Palmer v. Whitney, 166 Mass. 306, 44 N.E. 229; Robbins v. Horgan, 192 Mass. 443, 78 N.E. 503. The rights of the plaintiff therefore are not foreclosed by the decree. Abbott v. Foote, 146 Mass. 333, 15 N.E. 773, 4 Am. St. Rep. 314; Shores v. Hooper, 153 Mass. 228, 26 N.E. 846, 11 L. R. A. 308; Minot v. Purrington, 190 Mass. 336, 341, 77 N.E. 630. And this court having acquired jurisdiction can determine all questions within the frame of the bill which are necessary to afford the plaintiff full equitable relief. Perry v. Pye, 215 Mass. 403, 413, 102 N.E. 653; James v. Newton, 142 Mass. 366, 8 N.E. 122, 56 Am. Rep. 692; Fourth Street Bank v. Yardley, 165 U.S. 634, 17 S.Ct. 439, 41 L.Ed. 855.

The payment of debts and charges of administration do not appear to have so depleted the personal estate as to require contribution by the legatee, and the entire legacy was due and payable at the date of the final account. Fitch v Randall, 163 Mass. 381, 40 N.E. 182. It having been the duty of the executor to deduct and transmit to the plaintiff a sufficient amount of satisfy its demands, the payments made before stand the same in legal intendment as if made...