Seger v. Farmers' Loan & Trust Co.

Laughlin, J. (dissenting):

I also dissent, and while concurring fully in Justice Ingraham’s opinion, I wish to add some further observations. The defendant was not a debtor but a trustee of the beneficiaries referred to but not named in the will, and there was and could be no assignment of a debt due from it. (Parks v. Innes, 33 Barb. 44, 45.) Its obligation was to the cestuis qioe trustent created by the Will. It could not become a trustee for another without its knowledge. It does not appear that it knew or had means of knowing that the alleged assignee was one of such beneficiaries or, if so, hut that she was an unmarried minor,” for whose education and support the defendant was required by the will to apply the income of the fund, in which case the assignment would be void as to the income at least. (Matter of Hoyt, 5 Dem. 442-446.) The letter from Schaeffler asserts that the fund assigned was a portion of that held in trust. The defendant promptly replied, asking for further information that would enable it to act intelligently. Schaeffler was either the agent of the plaintiff to give the notice or he was not; but in any event she can take no advantage of the notice he gave without also the responsibility for his omission to give further information when called upon. It may be conceded that *299•any notice to the defendant which would be sufficient to put it upon inquiry would suffice; but the difficulty with the plaintiff’s case is that it appears that the defendant did inquire of the party from whom it received the notice and who was the only person whose address was given. Its reasonable inquiry was never ans svered. In these circumstances, if the defendant awaiting a reply failed to make a record of the letter, who should suffer ? Manifestly the plaintiff on account of her omission to make a personal claim or furnish the particulars of her right. In view of the fact that no answer to its letter was received, and of the great lapse of time without further notice or claim, had not the defendant the right to assume that the -communication was unauthorized or the assignment had not been consummated or had been rescinded or annulled, or that the assignee elected to rely upon the integrity of the assignor ? If the defendant were an ordinary debtor, no evidence was furnished the defendant by which it could resist payment to the assignor or even obtain an order of interpleader if sued. (Stevenson v. New York, Life Ins. Co., 10 App. Div. 233; Steiner v. East River Savings Inst., 60 id. 232.) If the defendant had asked that the plaintiff be cited to appear on the accounting, she might have disclaimed any interest and have demanded and obtained costs against it personally. The alleged notice, in view of the failure of Schaeffler or the plaintiff to respond to defendant’s reply and the length of time that elapsed, was utterly insufficient to constitute the defendant a trustee for the plaintiff. In my opinion the defendant was perfectly justified in distributing the fund without taking further action to discover whether plaintiff had a valid assignment. This is a suit in equity. The plaintiff has slept upon her rights and negligently allowed the defendant to act upon the belief that she made no claim against it. Clearly it has been misled because of her failure to do what she should have done to perfect her equitable title. The'defendant has in good faith distributed the fund, and the plaintiff should be left to her remedy against her assignor, who has, owing to her own negligence, received it. I, therefore, vote for reversal.

Judgment affirmed, with costs.