Kay Manufacturing Corp. v. Weiss

Louis L. Friedman, J. Defendant moves pursuant to rule 112, of the Rules of Civil Practice, for judgment on the pleadings. In substance the action is for goods sold and delivered to defendant upon which there is an alleged balance due of $609.92. Defendant asserts that there has been an assignment for the benefit of the creditors and that since plaintiff received a prorata dividend plaintiff’s claim is satisfied and discharged. An assignment under article 2 of the Debtor and Creditor Law does not discharge the debtor (Swift & Co., Inc., v. Novotny, 28 N. Y. S., 2d 562); “ he continues to remain liable for the unpaid balance of the debt and the creditor may resort to and pursue such remedies to compel payment of the balance as may be available, unaffected by the general assignment ” (Matter of Pavone Textile Corp. [Bloom], 195 Misc 702, 704, affd. 302 N. Y. 206, affd. 342 U. S. 912). Section 83 of article 3 of the Debtor and Creditor Law is not applicable to an article 2 assignment. An article 2 assignment applies to one where the debtor without the concurrence of his creditors assigns his property. Article 3 pertains to a debtor’s discharge from his debts upon his petition made with the consent of his creditors (Report of Board of Statutory Consolidation, 1907, pp. 728-730). Accordingly, the motion is denied.