Lexow v. Tremaine

Hill, P. J. This appeal involves the priority of the lien of an attorney under section 475 of the Judiciary Law. The defendant McEligot contracted with the State concerning construction at Letchworth Village. The appellant insurance company, as surety, executed bonds to the State in his behalf and was required to advance moneys to his creditors and incur other expenses. It obtained from him an assignment in 1929, the essential part reading, “ For value received I hereby assign, transfer and set over to Commercial Casualty Insurance Co., its successors and/or assigns, as collateral security, my claim about to be filed and prosecuted against the State of New York * * *, to the extent of all losses, damages or charges of every nature or description incurred or borne by the said Commercial Casualty Insurance Co. in connection with or arising out of bonds executed on behalf of the said Michael C. McEligot.” Respondent represented the claimant before the Court of Claims, and in March, 1936, obtained a judgment for the sum of $32,821.65. The value of respondent’s service has been agreed upon at $10,000, with disbursements of $1,414.82. The order of mandamus appealed from directs the Comptroller to pay that sum to him. The amount of the insurance company’s claim against McEligot has been fixed by a judgment of the Supreme Court, dated December 14, 1936, at $23,879.90. The insurance company contends that it should receive the full amount of its judgment, and that the balance of the fund — about $9,000 — be paid to respondent by the Comptroller. At the time of the assignment, the amount of the claim of McEligot against the State was unliquidated. The assignment states that the claim was to be “ filed and prosecuted,” which shows that the parties understood that there would be attorney’s fees. It was through the efforts of the attorney that the judgment was obtained. He was working for McEligot but indirectly for the collateral assignee. The petitioner is entitled to be paid in full. (Judiciary Law, § 475.) Matter of Loomis (273 N. Y. 76) is not an authority. [309] There the amount owing by the State had been liquidated and the share belonging to the descendants of each of the two partners definitely determined, and the attorney for the descendants of one of the partners was not permitted to retain a fee from the amount belonging to the descendents of the other partner, they not having retained him. The order should be affirmed, with fifty dollars costs. McNamee, Crapser and Heffernan, JJ., concur; Bliss, J., dissents, with an opinion.