United States Fidelity and Guaranty Company, Appellant, v. Twelfth Ward Bank, Respondent

United States Fidelity and Guaranty Company, Appellant, v. Twelfth Ward Bank, Respondent. First Department, May 31, 1912. Guaranty and suretyship—action by surety to recover loss paid on undertaking in' replevin — defenses — demurrer—security by creditor. In an action by a surety company against a judgment creditor to recover the amount which it had been forced to pay in an action brought against it upon an undertaking which it had given at the request and for the benefit of said judgment creditor, conditioned for the return of chattels replevied by a receiver in supplementary proceedings, the following defenses were pleaded: (1) That the receiver has already recovered a judgment against the defendant upon a special agreement that, if the receiver would pay over to the defendant a certain sum out of the' proceeds of the sale' of the replevied chattels, it would return the same if it was finally determined that the owners of the chattels were entitled thereto; (2) that a judgment has been recovered against the defendant, the receiver, and the owner of the chattels replevied by the assignee of mortgagees of the chattels for damages sustained by reason of the sale in replevin, and (8) that the plaintiff has an agreement with a third person indemnifying it against loss upon the undertaking, constituting a waiver as to defendant. Held, that none of the defenses is sufficient, either by way of bar or of estoppel, and that the plaintiff’s demurrer thereto should have been sustained. A creditor may take as many securities as he can get, the presumption being, in the first instance, that they are cumulative. Appeal by the plaintiff, the United States Fidelity and Guaranty Company, from an interlocutory judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of New York on the 14th day of November, 1911, upon the decision of the court, rendered after a trial at the New York Special Term, overruling the plaintiff’s demurrer to certain defenses. Allan C. Rowe, for the appellant. Tompkins McIlvaine, for the respondent. [MAJORITY — Dowling, J.:] Dowling, J.: The action is brought to recover the sum of $6,399.50 upon the following state of facts: On June 30, 1902, in a matter pending in the City Court of the city of New York, entitled “In proceedings supplementary to execution upon a judgment in an action entitled ‘ Twelfth Ward Bank vs. Columbia Publishing Company,’ ” Eugene C. Gilroy was duly appointed receiver of the property and assets of the Columbia Publishing Company on motion of the defendant herein. The receiver duly qualified, and in that capacity, at the request of this defendant, brought an action in replevin in the Supreme Court, New York county, against the Everson Hickok Printing Company and another to recover certain chattels claimed to belong to the receiver. In that action, on September 12, 1902, at this defendant’s request and for his benefit, plaintiff herein executed an undertaking in the sum of $11,000, conditioned for the return of the chattels replevied, if possession' thereof was adjudged to the defendant in said action, or in default thereof for the payment of any judgment against the plaintiff therein. Thereafter the sheriff of New York county replevied the chattels from thé. printing companies, they were sold by the receiver and the proceeds paid over by him to the defendant herein. No other property ever came into the receiver’s possession. Thereafter the replevin action was tried and judgment entered in favor of the defendants therein. As the receiver could not return the property, final judgment was entered against him in the sum of $4,758.83, which he did not, and could not, pay. Whereupon action was commenced against this plaintiff by the Everson Hickok Printing Company. and another upon the undertaking, judgment was obtained by them against this plaintiff and it was finally obliged to pay the sum of $6,399.50 thereunder.; The second separate defense undertakes to set up as a bar to plaintiff’s maintenance of this action the recovery of a judgment by the receiver against this defendant in an action brought in the City Court of the city of New York. But that action was brought upon a special agreement claimed to have been made between the receiver and the Twelfth Ward Bank,, by which the latter agreed that if the former would pay over to it the sum of $1,000 out of the proceeds of the auction sale of the replevied chattels, it would return the same if it was finally determined that the owners of the chattels were entitled thereto. The complaint set forth that judgment had been entered in favor of defendants in the replevin action,: but that the bank had returned $150 and no more out of the $1,000. The receiver recovered judgment for the full amount claimed. But it is apparent that the judgment in that action is not a bar to the present suit. The plaintiff herein was not party to the City Court action, which was brought upon a special agreement to return a certain sum of money upon the happening of a' certain event. The only undertaking referred to in that action was the receiver’s bond in the sum of $1,000 for the faithful performance of his duties. No issue in the case at bar was directly or indirectly involved in that action, and it is without effect on the right to recover herein. The third defensé sets forth the bringing of an action by Spencer Lathrop against the Twelfth Ward Bank, Eugene C. Gilroy and Hiclcok Printing Company in the Supreme Court, Westchester county, upon assigned claims, to recover the damages sustained by reason of the sale in the replevin action of the chattels hereinbefore described, upon which his assignors held mortgages to secure an aggregate indebtedness of $3,605.51. In that action the plaintiff finally recovered judgment. But the present plaintiff was not a party to that action, and so fa,r as the parties therein were ¡concerned it established that the receiver and the present defendant were joint tort feasors, the latter upon the ground that it had instigated, conducted and controlled the replevin action with a view to obtaining the benefit of the same, and it did in fact so benefit. The fourth defense is that the plaintiff demanded and secured .from one Vincent C. King a written application for the issuance of the undertaking in replevin, by the terms of which he agreed to indemnify and save harmless the plaintiff from all loss, damages and expense which it might sustain by reason of the undertaking, and that it also exacted and procured from said King an agreement of indemnity to the same effect, by reason whereof plaintiff waived any claim against the defendant. But there is no allegation that King has ever paid anything on account of his indemnity, nor that plaintiff ever . agreed to waive any claim against defendant. A creditor can take as many securities as he can get, the presumption being, in the first instance, that they are cumulative. (Wesley Church v. Moore, 10 Penn. St. 273.) None of the defenses sought to be pleaded is sufficient, either by way of bar or of estoppel. The judgment appealed from will, therefore, be reversed, with costs to appellant, and the demurrers to the second, third and fourth defenses set up in the answer will he sustained, with costs. Ingraham, P. J., McLaughlin, Laughlin and Miller, JJ., concurred. Judgment reversed, with costs, and demurrer sustained, with costs.