The seller is the third party defendant in each case, on the theory that it has breached its warranty accompanying the original sale in each case. In other words, the complication arises because the seller, instead of suing directly and thus exposing itself to a possible counterclaim for breach of warranty, has assigned the original contracts of sale, and the assignee sues in its own right. Cf. National City Bank of New York v. Prospect Syndicate, 170 Misc. 611, 10 N.Y.S.2d 759. A provision common to both contracts of sale is the pivotal issue upon which this decision must rest.
However, in United States v. Troy-Parisian, Inc., 115 F.2d 224, which involved a conditional sales contract with a similar clause, the court held that such a clause in the contract bars such a defense to the note. To the same effect are Jones v. Universal C.I.T. Corp., 88 Ga. Appeals 24; National City Bank of New York v. Prospect Syndicate, Inc., 170 Misc. 611, 10 N.Y.S.2d 759; Guaranty Securities Co. v. Equitable Trust Co., 136 Md. 417; Bank of Centerville v. Larson, 47 S.D. 374; Refrigeration Discount Corp. v. Haskew, 194 Ark. 549. We are persuaded by the reasoning in the cases cited that defendant, because of the quoted clause in the conditional sales contract, is barred from asserting the defense relied upon.
Defendant was at least entitled to cross-examine its witnesses in an attempt to verify how much the bank knew about the affairs of Thermotemp which it was financing. Paragraph 6 in this contract may have some force in relieving an assignee of the effects of a breach of contract by the assignor occurring subsequent to its assignment (cf. Presidents&sDirectors of Manhattan Co. v. Monogram Associates, 87 N.Y. S.2d 753, mod. 276 A.D. 766; National City Bank v. Prospect Syndicate, 170 Misc. 611; 2 Williston on Contracts [Rev. ed.], § 432), but it was not designed to cover a contract which has been broken before being assigned. If the clause were applicable to the state of facts adduced here by defendant, it would have the effect of precluding rescission based on facts in existence at the time of the conditional sale, even if plaintiff had notice of them. That cannot have been the intention of the contracting parties. Clauses in contracts are not favored which merely purport to change what would otherwise be the operation of law.
The defendants argue that there were other agreements or writings between the defendants and the assignor which should be considered as part and parcel of the conditional sales contract since these agreements were breached by the assignor. Where a contract of conditional sale is complete on its face and purports to contain the entire contract between the parties, an assignee thereof is not liable to the conditional buyer for a subsequent breach of some independent agreement which, though relating to the goods sold, is not a part of the contract assigned by the seller, provided, of course, the assignee takes the assignment in good faith without an intent to defeat any of the rights of the buyer (Eager, Chattel Mortgages and Conditional Sales, § 395 citing National City Bank v. Prospect Syndicate, 170 Misc. 611). In the instant case there has been no showing of bad faith on the part of the plaintiff ( Glens Falls Nat. Bank Trust Co. v. Sansivere, 136 N.Y.S.2d 672).