Campbell v. Genet

By the Court, Brady, J. Supplementary proceedings were commenced against Mary E. Foster on the 15th of April, 1857. The plaintiff was, in those proceedings, -appointed a receiver on the 18th of June, 1857. The debtor was entitled to the income arising from the sum of $30,000 under the will of her father, and the defendant had acted as her agent in collecting or receiving it for her from the trustee, Anthony Hoguet. The plaintiff alleged that the defendant had so received from Mr. Hoguet, between the 5th of February, 1856, and the 1st of May, 1857, the sum of $3,956.12, and had paid over to Miss Foster only $1,500, leaving in his hands belonging to her the sum of $2,456.12. The defendant proved various payments, and gave proof of a counter claim for services rendered. The referee rejected the counter claim, because it was not due to him in his own right, and allowed, in the account against the defendant, two payments made to him after the proceedings supplementary were commenced, and before the order appointing the plaintiff receiver was made, namely: $100 on 4th of May, 1857, and "$30,6.82 on the 14th of May, 1857. The defendant objects to both these acts of the referee. The proof shows that the services upon which the set-off was based had been rendered by the firm of Gr. C. & E. J. Genet, of which defendant was a member, and there is no proof of the assignment of the interest of E. J. Genet to him, or of any authority thus to appropriate such interest. The referee very properly excluded the set-off for these reasons. The set-off must be due to the defendant in his own [295] right, either as being the original creditor or payee, or as being the assignee or owner of the demand. 2 R. S. 354, § 18, sub. 2 It was said on the argument that this set-off or counter claim was set up in the answer, and that, not being denied by the plaintiff, it must be admitted to be due. The answer to that proposition is, that, assuming the defendant’s conclusion on the pleadings to be correct, he has waived his advantage by going into the proof of the counter claim, and by such proof showing that it could not have been properly set off against the plaintiff’s demand. In reference to the second objection, there is no evidence in this case showing that Miss Foster was not entitled to all the moneys received by the defendant on the 15th April, 1857, when proceedings supplementary were commenced. Mr. ' Hoguet testifies that he received, from Feb. 6, 1856, to May 1, 1857, the amount hereinbefore stated, but he does not state, nor does it anywhere appear in the case, that the money so received was not due on the 15th April, 1857. The defendant did not set up the defence that the payments to him, on the 1st and 14th May, 1857, were made after the supplemental proceedings were commenced, or that the moneys received by him on those days were not due to Miss Foster until after those proceedings were commenced, and has equally failed to show that fact by proof on the trial. The will under which Miss Foster was entitled was not produced on the trial, and the character of the provision therein for her benefit, and the times and manner of the payments to be made to her, do not appear. If the defendant, who is a debtor of Miss Foster, desired to avail himself of the defence that the plaintiff, as receiver, was endeavoring to obtain property to which he was not entitled, it was his duty to place the facts constituting such defence before the court, and not leave it to inference. The question was not whether the defendant received the money after the proceedings were commenced, and before the order appointing the receiver was made, but whether the money received by the defendant, at any time before the commencement of this action, belonged to Miss Foster at the time the supplementary proceedings were commenced. The view [296] thus expressed of the second objection is predicated of the proposition that the receiver acquires title only to the property belonging to the judgment debtor at the time proceedings supplementary are commenced against him.- Judge Ingraham, in Stewart v. Foster, (1 Hilton, 505), stated that proceedings supplementary were “ limited to reaching the defendant’s property in his possession, or in the possession of others and conceded to belong to him when the order is obtained,” and this principle was. also applicable to creditors’ bills prior to the Code. Caton v. Southworth, 13 Barb. 337; McCormick v. Kehoe, 7 Legal Obs. 184; Browning v. Bettis, 8 Paige, 568; 2 Barb. Ch. Pr. 153; McCam v. Dorsheimer, 1 Clarke, 144; Campbell v. Foster, 16 How. P. R. 275. But a creditor’s bill was held to reach the rents and profits of. the debtor’s real estate, sold upon execution, for the fifteen months’ possession after the sale to which he was entitled by law. Farnham v. Campbell, 10 Paige, 598. And also to reach an annuity given by will in lieu of dower. Degraw v. Classon, 11 Paige, 136. The income of the fund provided by the will of the debtor’s father, was the property of the debtor at the time of the commencement of supplementary proceedings, and, so far as it had accumulated on that day, could, under the authorities stated, be arrested and applied to the payment of the judgment against her on which such proceedings were based. A mere possibility could not be reached, (Smith v. Kearney, 2 Barb. Ch. R. 533), nor a salary not yet earned; but a salary earned before the filing of the bill, though not payable, could be reached. Browning v. Bettis, 8 Paige, 568. If the defendant had shown that a part of the sum received by Mr. Hoguet, and paid over to him, was not due on the 15th April, 1857, we might, under the decision of this court at general term, (supra), have felt constrained to deduct so much of such income as had not accrued on that day. For these reasons I think the second objection was not well taken, and that the judgment should be affirmed. The questions involved, aside from those herein considered, were ques [297] tions of fact for the referee, and his finding seems to be correct. Upon the argument, by consent, an application was entertained for a new trial on newly discovered evidence, and the discovery consists of an alleged payment made by the defendant, for or on account of Miss Foster, which he had overlooked when he testified before the referee. It is sufficient to say, in reference to that, that knowledge of the payment could have been acquired by the defendant with reasonable diligence. If he had made the proper preparation for his defence, the item would not have been omitted. The case of The People v. Superior Court of New York (10 Wend. 285,) is conclusive upon the question presented. See also Leavy v. Roberts, ante, p. 285. The application must be denied. Judgment affirmed.