Rosen v. Lipshitz

Ryan, J. The facts, substantially undisputed, are as follows: Supplementary proceedings were instituted by the judgment creditors by the service of third party orders on two fire insurance companies on March 18, 1933, both of which waived any irregularities of service, each submitting an'affidavit in lieu of appearance and examination. By those respective affidavits it appears that the judgment debtor has an agreed claim against one of said companies amounting to the sum of $266.29 and against the other for $238.75, aggregating $505, as a result of a fire loss sustained by the judgment debtor. The judgment creditors have thus acquired an equitable lien on said aggregate sum of $505 owing by said insurance companies to the judgment debtor, which on the appointment of a receiver would ripen into a legal title in such receiver 145 as of March 18, 1933, the date of the service of said third party-orders. (Civ. Prac. Act, § 810; McCorkle v. Herrman, 117 N. Y. 297, 305.) Subsequent to the service of said third party orders and on March 25, 1933, the judgment debtor made a general assignment for the benefit of all his creditors. That fact neither stays nor suspends the remedies of the judgment creditors. (Matter of Rutaced Co., 137 App. Div. 716.) Nor is the assignee such a bona fide purchaser without notice and for a valuable consideration as to defeat the legal title of a receiver when appointed. The motion must, therefore, be granted. Submit order.