Opinion
Argued February 28, 1882
Decided October 17, 1882
J. Q. Van Voorhis for appellant. W.H. Adams for respondent.
As no opinion was written either at the Special or General Term, we are not informed of the grounds upon which this order was made and affirmed, except so far as may be inferred from the facts disclosed in the affidavits. We are of opinion that that part of the order which directs the receiver to apply the $630 paid by the defendant Stiles to the plaintiff's attorney in satisfaction of the judgment, and to pay over to said Stiles the balance that may remain after satisfying the same cannot be upheld. The motion for substitution was made in the action of Warfield v. Stiles, and not in this action. The court granted the motion upon the condition that Warfield should satisfy the claims of Mr. Gillett, the plaintiff's attorney in this action and also in the other action pending between Myron Stiles and the defendant; and thereupon it was agreed between Warfield and Gillett that the amount of the latter's claim should be fixed at $800, and that sum was inserted in the order. Surely such an arrangement between Warfield and the plaintiff's attorney could not be binding upon the plaintiff in that action. While notice of the application to substitute the receiver in place of the plaintiff was properly served upon the attorney of the plaintiff, yet no order could have been made fixing the amounts of Gillett's compensation as between him and his client, which would be binding upon the client without personal notice to him. This was a question in which the interest of Gillett was hostile to that of his client. He could not, therefore, represent him or bind him upon such a question. The amount fixed in the order, as the sum to be paid as the condition of substitution, was binding only upon Warfield and Gillett, and not upon Myron P. Stiles, the client. This defendant having, as he alleges, become interested in the judgment under which the receiver was appointed, stipulated privately with Gillett for a reduction of his claim to $630, and then paid the same. The order in terms provides not for the payment of the judgment, but for the payment of the charges of Gillett for his professional services in the two actions. The sum which Stiles should pay his attorney for services could not be determined upon agreement between Warfield and the attorney, nor could it be determined by the court, except in a direct proceeding for that purpose, had between the client and the attorney, and of which the client had notice. The order appealed from arbitrarily compels Stiles to adopt the acts of these strangers and to pay a claim that he has a right to controvert in the ordinary way. If the defendant has any claim by reason of the payment of the money to Gillett, he can only enforce it by an action for money paid for the benefit of Myron P. Stiles, or for the receiver; it cannot be enforced by a motion. ( Hill v. Hermans, 59 N.Y. 396; Phillips v. Wicks, 38 N.Y. Supr. 74; Romain v. Garth, 5 T. C. 361; Prouty v. Swift, 10 Hun, 232; S.C., 64 N.Y. 545.) It is not an adjudicated claim, nor is there any stipulation in respect to it, to which Myron P. Stiles was a party, which the court is asked to enforce. To warrant a set-off on the motion both claims must be claims that have been duly determined by a binding adjudication. ( Harris v. Palmer, 5 Barb. 105; Bagg v. Jefferson, 10 Wend. 615.) There was no proof before the court in the case of Warfield v. Myron P. Stiles, in which the order was made, nor is there any proof upon this motion showing that Gillett's claim was right or ought to have been paid. Nothing has been done at any time or place, or in any manner, to ascertain whether Gillett was entitled to the sum paid him by the defendant. The defendant bases his claim, and the order appealed from proceeds, upon the naked fact that he paid the money to Gillett. This is not sufficient.
We are also of opinion that that part of the order which directs the plaintiff to pay $750, to be applied in part to the payment of the two judgments of Warfield v. Myron P. Stiles, upon which no execution had been issued is also erroneous and must be reversed. The receivership of Goddard did not extend to these judgments, and for this reason the court had no jurisdiction to make the order. (Code, §§ 2464, 2465, 2466.)
The duties of a receiver in proceedings supplementary to execution are fixed by law. They are to appropriate the property of the judgment debtor to the satisfaction of the judgment under which he is appointed, and any other to which his receivership may be duly extended, and to restore the surplus, if any, to the judgment debtor. ( Porter v. Williams, 5 Seld. 150; Banks v. Potter, 21 How. Pr. 473; Howell v. Ripley, 10 Paige, 43; Cumming, Receiver, v. Egerton et al., 9 Bosw. 684.)
The payment of the two Warfield judgments upon which no execution had been issued was a matter in which Myron P. Stiles, the defendant, was personally interested. No order could be made by the court for the payment of these judgments without notice to him, and giving him an opportunity first to be heard. The receiver did not and could not represent him in those judgments. No order made in a motion to which Myron P. Stiles was not a party could be binding upon him, and it may well be doubted whether the payment of money by the receiver, in pursuance of an order made upon such a motion, would protect him as against the judgment debtor. If called upon to account, by Myron P. Stiles, the judgment debtor, for the money remaining in his hands after the payment of the judgment in the action in which he was appointed receiver, we do not see how he could set up this order as a justification for the application either of the $630, in satisfaction of the original judgment recovered by Myron P. Stiles against the defendant, or for the payment of the two judgments recovered by Warfield against him.
We observe that, in the notice of motion served in this case, and in which the order appealed from was made, it is stated and assumed that supplementary proceedings had been taken in all three of the Warfield judgments; and it may be that the court below based its order upon this assumption. But the affidavit of Stark, Warfield's attorney, served with the motion papers, clearly shows that supplementary proceedings had been taken in only one of said actions.
The orders of the General and of the Special Terms should be reversed, with costs.
All concur.
Orders reversed.