Kahn v. Richard L. Walsch Co.

Gerard, J. Plaintiff sues as assignee of an alleged claim of Coleman and Krause against the defendant. The complaint alleges that Coleman and Krause entered into a contract with defendant, agreeing to perform certain work and furnish certain materials; that defendant broke said contract and ¡Coleman and Krause suffered damages; that they assigned their claim to plaintiff. This action was commenced by the service of a summons and complaint in August, 1909. The supplemental answer sets up that a judgment was entered March 28, 1910, in an action commenced in September, 1909, in which defendant was plaintiff and Coleman and Krause were defendants; that the question of the breach of the contract set up in this suit was adjudicated in that suit and that the defendant in that [21] suit succeeded and that, therefore, the matters in suit are res adjudicate. It will be noted that the second suit was commenced after the defendant here, by the service of a summons and complaint in this action, had actual notice of assignment to plaintiff. The question is whether a party to a contract, after notice of the assignment of a claim against him and suit brought thereon, can bind the assignee by suing the other parties to the contract (the assignors) and thus deprive the assignee of his day in court. The estoppel or bar claimed here arises from the judgment. But no person ought to be bound by a judgment to which he is not a party. The rule that estoppels bind parties and privies applies only to an event arising after the event out of which the estoppel arises. Masten v. Olcott, 101 N. Y. 157; Mitchell v. Einstein, 105 App. Div. 421. Black on Judgments, referring to persons bound as privies to parties bound by judgments, says: “In the second place privies, in such sense that they are bound by the judgment, are those who acquired interest in the subject-matter after the rendition of the judgment.” Plaintiff is not concluded by the judgment pleaded and the judgment appealed from is affirmed, with costs. Seabury and Lehman, JJ., concur. Judgment affirmed.