Guaranty Securities Co. v. Equitable Trust Co.

⁴¹⁸ Urner, J., delivered, the opinion, of the Court. The Equitable Trust Company, of Baltimore, ordered in writing from the Budget Cheque Corporation, of Chicago, on April 11, 1917, a quantity of stationery to be used in the operation of a patented checking system for the convenience of the patrons of the purchasing institution. The system was designed to enable bank depositors to accomplish the payment of a number of commercial bills by the issuance of a single check to the bank for application to the accounts included in a list accompanying the check. It was stipulated in the Trust Company’s order that of the total purchase price of $1,582 for the specified supplies', required for the use of tbe budget check system, the sum, of $207 should be paid thirty days after shipment and the balance in monthly installments of $125 each, the first to- be payable thirty days after the initial payment.

Excess delivery to the extent of ten per cent, of the quantity purchased, and at a, pro rata price, was permitted under the terms of the order. The concluding stipulation was as follows: “This order and the ac^ ceptanee thereof are unconditional, shall noR be subject to cancellation and cover* all agreements regarding this contract between your company and ourselves.” The order was immediately accepted in writing on behalf of the Budget Corporation by its eastern representative. At the same time a separate order in writing was given, by the Trust Company for certain advertising and introductory service to* be rendered by the Budget Corporation to promote the successful inauguration of tire new system. The price agreed to be paid for this service was $750.

The last clause of the order just mentioned was -as follows: “Upon your acceptance hereof this supplemental agreement becomes' a part of our budget cheque contract bearing date of April 11, 1917.” This order also was at once accepted for the Budget Corporation by its representative who had negotiated the transaction. The shipment of .the supplies purchased under the first mentioned agreement was completed on June 12, 1917, and ⁴¹⁹ that contract was on the same day assigned in writing and for value to the Guaranty Securities Company, a corporation' engaged in the business of purchasing and collecting commercial claims. The assignment guaranteed the payments! for which the contract made provision. On the following day the Guaranty Securities Company wrote the Equitable Trust Company notifying it of tbe assignment of the contract, which was described as “your contract of April 11, 1917, the amount of said contract being $1,582, plus $101.30, tbe amount of the overrun.” The invoice, which had heen similarly assigned, for the deliveries made under the contract, and. the bills of lading; for the shipments, were enclosed in the letter giving; notice of the assignment.

The letter requested remittance to the assignee of the installment payments as they matured. This notification was acknowledged by the Trust Company in a, letter dated June 16, 1917, which stated that remittances would be made “in accordance with the assignment” to which the notice referred. On the 23rd of the following month the Trust Company sent $308.30 to the Guaranty -Securities Company in payment of the initial installment of $207 for which the contract provided and the overrun of $101.30. The performance of the separate agreement for1 service to be rendered by the Budget Cheque Corporation in the establishment of the budget cheek system: for the Trust Company wasi postponed, by their mutual consent, until September, 1917, but the former corporation had then' suspended operations because of financial difficulties1..

Consequently tbe service agreed upon was never rendered, and because of that de¡fault the Trust Company refused to make any further payments on account of the sales contract, of which the service agreement was by its. terms, made a part. In tbis suit by the Guaranty Securities Company the decisive question raised by exceptions to rulings of the trial Court on proposed instructions to itself, sitting asi a jury, is whether1 the Trust Company isi estopped by its conduct from invoking the general ⁴²⁰ rule that the assignment of a non-negotiable chose in action, though made to a purchaser for value and without notice, is subject to existing’ equities upon which the debtor may be entitled to rely as against the assignor. This theory of estoppel was excluded as the result of the action of the Court below in refusing the prayers offered by the plaintiff and in granting those submitted by the defendant, and the verdict and