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McQueen o. Babcock.
main question was as to the applicability of the statute of limitations.
It appeared that defendant was sheriff of Monroe county, and be relied upon the three years' limitation provided by section 92 of the Code of Procedure.
The plaintiff relied on the following facts to take the case out of the statute.
Henry A. Brown, the debtor of whom plaintiff was assignee, made his assignment in October, 1857. Soon afterwards, an attachment was issued at the suit of certain creditors, against the property of Brown, and was delivered to the defendant, as sheriff, for execution. Other creditors, having recovered judgment, then brought a creditors' suit against Brown and Babcock, his assignee, to set aside the assignment as fraudulent and void, and in that action they obtained an injunction against Babcock and Brown, containing a clause,—“enjoining him to desist and refrain from selling, assigning, conveying, or in any way or manner disposing of, incumbering or intermeddling with, diverting, negotiating, discharging, receiving or collecting any of the property of the defendant Henry A. Brown, real or personal, debts or demands due to him, notes, bills whether in his possession or held by some other person for his use or benefit .; and also from assigning, transferring, or in any way or manner disposing of or intermeddling with such property, &c.”
This injunction was duly served on the plaintiff in this action, and it continued in force until January 4, 1857, when it was dissolved.
The wrongful seizure of the goods for which this action was brought was made in February, 1858. This action was brought more than three years after such seizure, but less than three years after the dissolution of the injunction. The court at the trial directed a verdict subject to the opinion of the court at general term.
The supreme court, at general term, on the application for judgment, held that the words “receiving or collecting any of such property,” in the injunction, applied only to notes, accounts, &c., as property not in possession of the plaintiff at the time of the service of the injunction, and that the only prohi
McQueen v. Babcock,
bition applicable to the bringing of an action for conversion was the one embraced in the words, “intermeddling with such property;" and that these words did not forbid taking care of, receiving, or protecting such property. They accordingly held that the right of action was not suspended by the injunction, and therefore that the statute of limitations was a good defense.
The plaintiff appealed to this court, and by direction of the supreme court the order allowing defendant to plead the statute was incorporated in the record for review.
John Dorr, for plaintiff, appellant,-Cited: Spring v. Strauss, 3 Bosw. 607; Parker v. Wakeman, 10 Paige, 485; Code, $ 105 ; Berrien v. Wright, 26 Barb. 208; 1 R. S. 5 ed. p. 876, $ 162; Neale v. Osborne, 15 How. Pr. 81; Smith v. Consolidated Stage Co., 28 Id. 277; S. C., 18 Abb. Pr. 419; N. Y. Ice Co. v. N. W. Ins. Co. of Oswego, 23 N. Y. 357.
W. F. Cogswell, for the defendant, respondent,-Cited: Thompson v. Kessel, 30 N. Y. 383; N. Y. Ice Co. v. The N. W. Ins. Co., 23 Id. 357; Mason r. Whitely, 4 Duer, 611; Townsend v. Platt, 3 Abb. Pr. 323; Griffin v. Cohen, 8 How. Pr. 451; Spencer v. Tooker, 12 Abb. Pr. 354; S. C., 21 How. Pr. 333; Fielden v. Carelli, 26 How. Pr. 173; S. C., 16 Abb. Pr. 289; Johnson v. Whitlock, 13 N. Y. (3 Kern.) 344; Hunt v. Bloomer, Id. 341 ; Otis v. Spencer, 16 N. Y. 610; Titus v. Orvis, Id. 617; Bissel v. Hamlin, 20 Id. 519; Laurie v. Laurie, 9 Paige, 234; McCredie v. Senior, 4 Id. 378; Parker v. Wakeman, 10 *7. 485; 2 Barb. Ch. 593.
BY THE COURT.-GROVER, J.-The general term correctly held that the defendant had the right to serve an amended answer twenty days after service of the original, and to include therein a new defense. Code of Pro. $ 172; Thompson v. Minford, 11 How. 273; Wymau v. Remond, 18 Id. 272. This is now the settled practice of the supreme court. The idea that the defense of usury or of the statute of limitations, was to be treated in this respect different from other defenses, has been exploded. Courts now regard all legal defenses as entitled
McSpedon v. Troy City Bank.
in this respect to the same consideration. The question in this case was not addressed to the favor or discretion of the court. The defendant had a legal right to serve the amended answer.
The only question upon the merits is whether the time during which the injunction was in force, should be excluded from the meaning of the statute of limitations. It is provided by statute that the time during which a party shall be prevented by injunction from commencing an action, shall not be computed. Code of Pro. 8 105. The inquiry is whether the injunction in the present case restrained the plaintiff from commencing a suit for the tortious taking of the property in his possession, subsequent to its issue. A perusal of the injunction satisfies us that it had no such effect. It left the defendant at full liberty to take care of and protect the property in his possession from all tortfeasors. For this purpose he was at liberty to prosecute suits against such. The time therefore cannot be deducted, and the statute constituted a defense. The judgment should be affimed.
All the judges concurred.
Judgment affirmed, with costs.
MOSPEDON ads. TROY CITY BANK.
Negotiable notes, made under an agreement that the payees should give
the makers a definite sum, weekly, in the bills of a certain bank in payment therefor; and that the notes at maturity should be taken up by the makers,- Held, to be not accommodation but business paper, made for a consideration ; and, when transferred to third parties by the payees, in payment of, or as collateral security for their indebtedness, to be not subject to equities subsequently arising between the original parties.
Thomas McSpedon and C. W. Baker were sued by the Troy City Bank in the supreme court, on a promissory note.
McSpedon v. Troy City Bank.
The note in question was one of six notes, made by the firm, on June 8, 1857, payable respectively at from one to seven months, to the order of M. L. Samuel & Co.
McSpedon & Baker were a business firm in the city of New York. The agreement under which the notes were given was as follows: “Confidential contract. We agree to give Messrs. McSpedon & Baker $400 weekly in Troy City Bank bills, in payment of their notes, they (McS. & B.) to take up the notes as they mature, viz:" [here followed a list of notes payable at periods varying from two to seven months from June 18, 1857, and all for sums of between one thousand eight hundred dollars and one thousand nine hundred dollars).
“Dated June 8th, 1857. Signed, M. L. Samuel & Co."
On June 22, four days after this arrangement, M. L. Samuel & Co., the payees, indorsed and transferred the note to defendants as collateral security for a pre-existing debt. Samuel & Co. made only one payment of four hundred dollars under the agreement, having failed in business within a month after its date, and were, at the time of the trial, insolvent. The nove was made payable at the Bank of North America, and at its maturity (which was six months from date) was paid to the defendants by the bank, from the plaintiff's funds, by a mistake or oversight, subsequently to a notice given by the plaintiff's to the bank officers not to pay it. Before the comniencement of this action the defendants were requested to pay the plaintiffs the amount thus received, which was refused.
The supreme court, on appeal, affirmed a judgment rendered against defendants by a judge on the trial without a jury, holding that the transaction was in substance an exchange of the notes for the agreement, each being a consideration for the other. Though the language of the agreement was that the bank bills were to be received in payment of the notes, the fair meaning obviously was that the bills were to be in payment for the notes; that the case was the same in principle as if, instead of the writing executed by the payees of the notes, the payees had at the same time given their notes to the same amount in accordance with the provision for weekly payments. In this view of the case, the notes were business paper (2 Den. 621;
McSpedon v. Troy City Bank.
3 Id. 187; 24 Wend. 94; 6 Duer, 538] and the evidence showed defendants to be bona fide holders for suficieat legal consideration. [1 Sandf. 53; 5 Id. 7.] Plaintiffs appealed.
John W. Edmonds, for plaintiffs, appellants ;-Insisted that the notes were accommodation and not business paper. The true test is, could the original payee sue on the paper if not transferred ? and as between original parties, on which of them rests the obligation as to final payment? Pars. Merc. Law, 93, 8C; Wooster v. Jenkine, 3 Den. 189; Dow v. Schutt, 2 Den. 623. The agreement was not an exchange, but merely fixed the time within which Samuel & Co. were to perform the obligation which the law cast upon them by reason of their receiving plaintiff's notes made for their accommodation. Defendants were not bona fide holders for value. Bay v. Coddington, 25 Johns. 657; Stalker v. McDouald, 6 Hill, 93 ; Youngs v. Lee, 12 N. Y. 551; Smith's Merc. Law, Am. ed. 258, n.; 3 Kent, 5 ed. 78. That the money sought to be recovered was paid by mistake and is recoverable by assumpsit. 2 Smith's Lead. Cas. 394; Brown v. McKennally, 1 Esp. 279; Parker Great Western R. R. CO., M. & Gr. 253; Franklin Bank v. Raymond, 3 Wend. 69.
John H. Reynolds, for defendants, respondents ;—That the arrangement was an exchange of notes, cited Dow v. Schutt, 2 Den. 621; Cameron v. Chappell, 24 Wend. 94; Davis v. McCreads, 17 Y. N. 232. That defendants were bona fide holders. Furniss v. Gilchrist, 1 Sandf. 53; Graves v. Woodbury, 4 Hill, 559; Spencer v. Barbour, 5 Hill, 568; Wheeler v. Wheeler, 9 Cow. 34; Mead v. Gittell, 19 Wend. 397; Brookman v. Metcalf, 5 Bosw. 429, 444. That there was no mistake of fact. Mowatt v. Wright, 1 Wend. 300; 2 Smith's Lead. Cas. 5 Am. ed. 403, marg. pag. 244; Milner v. Duncan, 6 B. & C. 671.
WRIGHT, J. (after stating the facts.]-The case involves the principal question whether the notes executed and delivered, under the agreement of the payees, M. L. Samuel & Co., to pay the makers four hundred dollars weekly, are to be treated as business paper. If not accommodation, but business paper,