Merchants' & Miners' National Bank v. Barnes

47 L.R.A. 737, 45 P. 218, 18 Mont. 335, 1896 Mont. LEXIS 280
Montana Supreme Court·Decided June 8, 1896·Published·Cited by 16 cases

Opinion

Hunt, J.

An action of assumpsit, for money had and received, is a remedy equitable in its nature, existing in favor of one person against another, when that other person has received money, either from plaintiff or a third person, under such circumstances that, in equity and good conscience, he ought not "to retain the same, and which ex aequo el bono, belongs to plaintiff. (Buel v. Boughton, 2 Denio 91; McFadden v. Wilson, 96 Ind. 253; Lockwood v. Kelsea, 41 N. H. 185; Laport v. Bacon, 48 Vt. 176.)

[338] The old doctrine of the common law, that no action of contract can be maintained unless there is privity of contract between plaintiff and defendant, no longer generally prevails. Thus under the common law, as illustrated by the facts of this case, the mining company being indebted to Tyler, and Tyler having given an order to the bank for moneys due on such debt to this plaintiff bank, the bank could maintain no common law action against the mining company to recover the amount, unless the mining company had assented to the appropriation, and promised, either expressly or by implication, to pay the money; and in such case the action would not be based upon any property or interest in the fund acquired by the bank through the order, but upon the pining company’s promise to pay.

But the equitable rule is different. By it an interest in the fund is recognized, and this interest arises through the order, which operates as an assignment, and generally permits such interest to be enforced by suit, even where the debtor upon •whom the order has been drawn has not assented to the transfer. In this case, therefore, if the mining company, as a debtor of Tyler, held money which it was bound to pay to Tyler, and if Tyler agreed with the plaintiff bank that the money should be paid to the. bank, and gave to the bank an order upon the mining company for the money, this order creates an equitable interest or property in the fund, in favor of the assignee, the plaintiff bank; and it was not necessary that the mining company should consent or promise to hold the money for, or pay it to, the plaintiff bank. This doctrine is applied in cases where the debt actually exists, or xhere it exists in futuro. As stated by Pomeroy (Pom. Eq. Jur., § 1283) : “The equitable doctrine with respect to the assignment of property to be acquired in future is extended to this species of equitable transfer. The fund need not be actually in being ; if it exists potentially, — that is, if it will, in due course of things, arise from a contract or arrangement already made or entered into when the order is given, — the order will operate as an equitable assignment of such fund as soon as it [339] is acquired, and will create an interest in it which a court of equity will enforce. ” (Brill v. Tuttle, 81 N. Y. 454; McFadden v. Wilson, 96 Ind. 253; Macomber v. Doane, 2 Allen 541; Tripp v. Brownell, 12 Cush. 376.) The order given, therefore, by Tyler to the plaintiff bank upon the mining company was a valid assignment of property to be acquired in the future, and created in the bank an interest in the fund to be acquired, which equity may enforce.

Nor do we doubt the general doctrine contended for by appellant, that a plaintiff may waive an action in tort, and sue in assumpsit, where the property has- been wrongfully taken, and converted into money. ‘ ‘ If a man, ’ ’ says Addison on Torts, ‘ has taken possession of property, and sold or disposed of it, without lawful authority, the owner may either disaffirm his act, and treat him as a wrongdoer, and sue him for a trespass or for a conversion of property, or he may affirm his acts, and treat him as his agent, and claim the benefit of his action, and if he has once affirmed his acts, and treated him as his agent, he cannot afterwards treat him as a wrongdoer; nor can he affirm his acts in part, and avoid them as to the rest. If, therefore, goods have been sold by a wrongdoer, and the owner thinks fit to receive a price therefor, he ratifies and adopts the transaction, and cannot afterwards treat it as a wrong. ’ ’

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Merchants' & Miners' National Bank v. Barnes, 47 L.R.A. 737, 45 P. 218, 18 Mont. 335, 1896 Mont. LEXIS 280 (Mo. 1896).

47 L.R.A. 737 (Merchants' & Miners' National Bank v. Barnes) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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