Opinion
December 13, 1935.
Appeal from the Municipal Court of New York, Borough of Manhattan, First District.
Sullivan Cromwell [ Robert E. Huston Jr., of counsel], for the appellant.
Irving I. Friedman, for the respondent.
The action is for conversion and the material facts are not in dispute.
Plaintiff delivered merchandise to a carrier for transportation to a purchaser in Philadelphia. The goods were to be delivered only on payment of the purchase price. The carrier delivered the goods to defendant, a connecting carrier in New Brunswick, N.J., which transported them to Philadelphia and made due delivery, collecting the price. Defendant credited the collection so made to the initial carrier in an account which it regularly maintained with that company. Later the initial carrier went out of business without having paid plaintiff the moneys which had been collected from its Philadelphia customer. At that time the initial carrier was in debt to defendant. Plaintiff having demanded payment from defendant sues that company for conversion and has had judgment.
We think the judgment is erroneous. It is conceded that if defendant had paid over the moneys collected by it to the initial carrier it would have been absolved from any liability. Indeed it would have had no right to make any other disposition of them. Its only duty or obligation was to the initial carrier. Upon collection of the moneys it became a debtor to the initial carrier and it discharged its obligation by giving credit to that company against its indebtedness. No trust was created by the transaction and plaintiff's only right of recourse was against the initial carrier with which it had contracted.
The judgment should be reversed, with thirty dollars costs, and judgment directed for defendant, with costs.
HAMMER and SHIENTAG, JJ., concur.
Judgment reversed, with thirty dollars costs, and judgment directed for defendant, with costs.