Opinion
May 23, 1949.
Action on nine promissory notes aggregating $4,500 by the payee plaintiff against the maker and indorsers, wherein the complaint, as served, alleged there was presentment and nonpayment, and also alleged waiver of notice of presentment and nonpayment, and dishonor and protest. At the trial the complaint was amended to plead waiver of presentment. The answer of respondents, as deemed amended at the trial, denied the allegations as to presentment and waiver, and alleged an agreement and assignment which discharged the indebtedness on the notes. Plaintiff appeals from the judgment dismissing his complaint as to the maker and one of the indorsers. The second indorser defaulted and was a witness for plaintiff. Judgment reversed on the law, with costs, judgment directed for plaintiff against the corporate defendant, with costs, the action severed, and a new trial granted as to the individual defendant Auerhaan, with costs to abide the event. The assignment delivered to plaintiff was void. ( Manhattan Commercial Co. v. Paul, 216 N.Y. 481; Martin v. National Sur. Co., 300 U.S. 588; McKenzie v. Irving Trust Co., 292 N.Y. 347.) It was not executed in accordance with Federal law. (U.S. Code, tit. 31, § 203, U.S. Rev. Stat., § 3477.) No warrant for payment had issued and payment thereunder had not been made. The United States was a creditor of the corporation. The assignment had no present value and, therefore, could not work a discharge of the notes. ( Wise v. Chase, 44 N.Y. 337, 340.) At best it was a conditional payment of the notes. ( Cherey v. McLaughlin, 245 N.Y. 616.) It would become effective only if and when the United States issued its warrant and made payment of the overassessment of income taxes. The corporate maker was, therefore, not discharged by delivery and acceptance of the assignment. The Trial Justice obviously permitted his erroneous conclusion that the assignment constituted absolute payment of the notes to shape his examination of the plaintiff and to enter into his determination as to the credibility of plaintiff on the question of fact as to waiver of presentment and waiver of notice of presentment. The findings in the decision that there was no waiver of presentment and that the assignment was given in full payment of the notes are reversed. Johnston, Acting P.J., Adel, Sneed, Wenzel and MacCrate, JJ., concur.