
    Artemas H. Holmes, Respondent, v. Helen Villard Bell and James W. Bell, Appellants, Impleaded with Fanny Garrison Villard and Others, Defendants.
    First Department,
    July 7, 1910.
    Practice — service by publication — defective complaint — equity — equitable lien — attorney’s lien — when suit in equity will not lie.
    To justify an order directing service of a summons by publication or personally without the State, the complaint upon which the order is based must not only be such as would withstand a demurrer on the ground that it does not state facts sufficient to constitute a cause of action but. must also state a cause of action of which the courts can take cognizance.
    An agreement either written or oral to pay a debt out of a designated fund does not give an equitable lien upon the fund or operate as an equitable assignment thereof.
    One furnishing information to enable another to institute and maintain a suit is not entitled to an attorney’s lien although he is an admitted attorney if he does not act as such in the suit.
    A suit in equity will not lie to establish a lien upon a trust fund based on an alleged contract providing that if the plaintiff gave, certain information upon which one of the defendants could.institute and succeed in a suit she would pay him twenty .per cent of the results obtained by her under a provision in the trust deed, concerning which the information was given. The remedy is . an action at law.
    
      And an order for service by publication which was based on a complaint setting, forth the contract, its. performance by'plaintiff, the non-residence and pecuniary irresponsibility of the defendants and seeking to impress a lien on the trust fund in this State, of which they had been declared beneficiaries, will be reversed. . .
    Appeal by the- defendants, Helen Yillard Bell and another, appearing specially, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 7th day of April, 1910.
    
      Frederic E. Mygatt of counsel [Van Wyck & Mygatt, attorneys], for the appellants.
    
      Rustus S. Ransom, for the respondent.
    
      William M. Wherry, Jr., of counsel [ Wherry & Morgan, attorneys], for the defendants Villard.
   Clarke, J.:

Appeal by the defendants Helen Yillard Bell and James W. Bell, appearing • specially for the purpose, from an order denying a motion to vacate an order directing that the service of the summons herein be made upon said defendants Bell by publication, or by personal service without the State. The motion to vacate was based upon two grounds, first, that the complaint herein does not establish a sufficient cause of action against the defendants to be served, and, second, that the papers upon which- the order was made were insufficient.'

The complaint alleges that plaintiff is an attorney at law; that the defendant Helen is the only daughter of the late Henry Yillard, and the defendant James W. Bell is her husband; that Henry Yillard and his wife, Eanny Garrison Yillard, on or about October 19, 1884, jointly executed a certain irrevocable trust to William Lloyd Garrison, as trustee, whereby they transferred to said Garrison as' trustee all their right, title and interest to one hundred and fifty-six shares of the Evening Post Publishing Company, of the par value ■of $500 each, to pay the income of seventy-six shares to the defendant Fanny Garrison Yillard during the term of her natural life, and upon her death to divide said seventy-six shares into as many parts ■as there were children of her and Henry Villard, then surviving, or the issue of such deceased children, and to pay over the same absolutely to the said surviving children; to divide the remaining eighty shares of stock into four equal parts of twenty shares each and to hold each of said blocks in trust for the following uses and purposes: To pay the income and dividends from one of the said blocks of shares to the defendant Helen Villard Bell until" she should "arrive at the age of twenty-one years, and upon her arriving at the age of twenty-four years to pay over one of said blocks of twenty shares to her, and upon the death of said Helen Bell before attaining the age of twenty-fo.ur years, without leaving issue, her share to be divided into equal parts among the survivors, the other trust beneficiaries named in such deed, or the issue of their deceased children. There are certain other provisions not material. That the said deed of trust was executed in triplicate and was signed by said Henry and Fanny Villard and said Garrison and duly acknowledged on October 19, 1884, before this plaintiff, who was them and ■ there duly authorized as a notary public to take said acknowledgments ; that said deed of trust was in all respects absolute and irrevocable. The said Garrison accepted said trust, and by the execution and delivery of said deed, he, as such trustee, was or became the holder of record of the said stock upon the books of said Evening Post Publishing Company; that Henry Villard died November 12, 1900; that the said Helen and her husband were in ignoi'ance of the execution of the said deed of trust and of the provisions thereof for the benefit of the said Helen until in or about the month of May, .1905, at which time she was represented by her attorney, one George D. Mumfo.rd, who, and also the defendant Helen Bell, were informed of all the above facts by this plaintiff; that about the first part of the month of May, 1905, the said Helen made a contract and agreement with the plaintiff, in writing, in the form of a letter written by the plaintiff to her, containing his proposal to aid and assist her as counsel and render any and all services in his power to her in the prosecution of a claim and the enforcement of her rights under said deed of trust, for his compensation of twenty-five per cent of the results obtained by her in the prosecution of her said claim, and from the letter from the said Helen Villard Bell in answer to the plaintiff’s proposition that she would pay him for such services twenty per cent of the results obtained by her tinder the provisions in her behalf of said deed of trust; which proposed modification of the plaintiffs proposition from twenty-five per cent to twenty per cent was accepted by the plaintiff in writing and delivered by him to her attorney, the said George D. Mumford, her duly authorized agent and attorney in that respect.

That after the consummation of said agreement for services to be rendered by him as such counsel as aforesaid, and appropriating and using the information ■ given to her by the plaintiff as to the existence of said deed of trust, the said Helen Yillard Bell, on or about May 15, 1905, commenced' abaction, by the said Mumford as her attorney in said action in equity, demanding that said deed of trust be declared a valid and existing trust and that the said Helen be declared, to be entitled to her beneficial interest as set forth in said deed of trust and to the actual ownership of twenty-six and two-thirds shares of said stock from- the date on which she attained the age of twenty-four years and all the income and profits accruing bn said stock from October 19,1884; that Garrison, the trustee, account to her and that he be declared to have been récreant in the trust confided to him and be. removed as such trustee, and that the defendants Yillard be directed-to account to her, etc.; that the defendant in said action served an amended answer putting in issue all the material averments of the plaintiff in that action ; that, said action. was never brought to trial, .but on or about the 28th of June, 1906, the said action was compromised and settled by the parties thereto without the knowledge or consent of the plaintiff; that it was provided by the terms and provisions of said compromise and settlement, reduced to writing and duly executed, that the sum of $5,000 cash should be paid- to the said Helen, and the said Fanny, Oswald and Harold Yillard, defendants in said action, conveyed and delivered to Harold Garrison Yillard, to and for the use of said Helen, the following securities (enumerating them), making a total of said bonds and stock $40,700; that the said parties also agreed to convey and did convey to Harold Garrison Yillard, as agent for the said Helen, the following securities (enumerating them),, making a total value of said stocks $46,175; that the same persons transferred and delivered to the said Harold, as agent for the said James W., husband of the defendant Helen Bell, securities (enumerating them), malting a total of $46,175 ; that said ■ parties also agreed to convey and did convey to the Knickerbocker Trust Company, upon the trust set forth in said deed of trust, duly executed and delivered for the purposes thereof, the following securities (enumerating them), making a total value of said stocks of $43,650; that the cash and securities set forth in said agreement of settlement and compromise were duly delivered to or for the use of the defendant Helen and her husband James, to their agent, the said Harold Villard, and that the terms, provisions and conditions of the said agreement of compromise and settlement were then and there wholly performed by the parties thereto, and the said action brought by said Helen to enforce the said deed of trust in her behalf was discontinued by her without costs; that the cash and securities delivered to said Harold to and for the use of said Helen are of the.value of $45,700; that the securities mentioned were delivered to said James W. Bell and are of the value of $46,175, and were subject to the lien of the plaintiff for his said services in the sum of twenty per cent of the fair value of the said securities and of the income paid thereon subsequent to June 28, 1906, and the said defendants and each of them are justly indebted to the'plaintiff for the same, with interest thereon which has not been paid.

The complaint sets up a supplemental agreement as a part of said compromise, with reference to further shares of stock subject to the claim of the plaintiff for his services twenty per cent of the income, and that such stocks are of the value of $43,650. On information and belief the plaintiff further shows that the defendant Helen and her husband are not residents of the Hnited States and have not been for many years last past, but are aliens, residents of and domiciled in Dresden, Saxony, Germany; that they are pecuniarily irresponsible, except for such interests as they may have under the said agreement of settlement and compromise and under said agreement between Harold Garrison Villard and the defendant Knickerbocker Trust Company of June 22, "1906, and said agreement between said defendant Helen and her husband and Fanny, Oswald and Harold Villard of May 27, 1907; that the said defendants Helen and James Bell have little or no property which could be reached by execution or otherwise to satisfy a money judgment of the plaintiff against them, and that they are in receipt of substantially no income except such income as is secured to them from the said stocks as the result of said services of the plaintiff, and that unless the plaintiff can enforce his claim in this court of equity and have the same' charged as a lien upon the said securities, and the income or installments therefrom payable by said defendant Knickerbocker Trust Company, he will be remediless, and that the plaintiff has ho adequate remedy at law, and that resort to this court of equity for his protection has become necessary. Plaintiff further shows that lie has fully performed his said contract and has been since the making of ' said contract ready to serve the said Helen Villard Bell according to the terms of his contract with her. Wherefore he demands'judgment that an account be taken of said securities and of their present value and of the installments payable to the said defendants under the terms of their settlement and out of which plaintiff has not been paid such twenty per cent, and that judgment for said' twenty per,, cent be rendered in plaintiff’s favor; that the agreement of the defendant Helen Villard Bell with the plaintiff be adjudged valid and binding upon all of said defendants herein and that the provisions of the said compromise and settlement with Helen and James W. Bell set forth be adjudged-to be a lien upon said securities and the income thereof upon the present valúe in favor of the plaintiff and as an equitable assignment to the plaintiff, of twenty per cent thereof ; that the plaintiff’s claim for services of twenty per cent upon said stocks and income, with interest and all future installments of income, payable by said defendant, the Knickerbocker Trust Company, be charged as alien upon and made, payable from such installments or income heretofore accrued , or hereafter accruing, and that the said Knickerbocker Trust Company be adjudged to pay the same direct to.the plaintiff.

. In Grant v. Cobre Grande Copper Co. (193 N. Y. 307) the court said: Section 439 provides that ‘ The order must be founded upon a verified complaint, showing a sufficient cause of action against the defendant to be served, and proof by affidavit of the additional facts required by the last section.’ The reversal of the Appellate Division appears to have been based upon the latter provision of the Code and upon the-ground that the complaint filed in. this action does not state a sufficient cause of action against the Cobre Grande Copper Company. It is not our practice upon motions of this character to search the complaint with the, care we would upon a demurrer.” But the court did go on and examine the complaint because this court had and came to the conclusion that it stated a cause of action, and, therefore, reversed the order setting aside the service by publication.

In Paget v. Stevens (143 N. Y. 172) the court said: “ This language [referring to Code Civ. Proc. § 439] does not mean simply a complaint which would withstand a demurrer based upon the ground that it did not state facts sufficient to constitute a cause of action. The cause of action which is sufficient is one against tlie defendant of which the court can take cognizance. In this case it must be one of which the court has jurisdiction (as to defendant Charles G. Stevens) upon the assumption that he is a non-resident. This meaning lias been adjudged to be the correct one in Bryan v. University Pub. Co. (112 N. Y. 382, 386).”

Certain other cases were collected in the opinion of this court in Grant v. Cobre Grande Copper Co. (126 App. Div. 750). McLaughlin, J.’s language in Montgomery v. Boyd (60 App. Div. 133) was quoted: “ So far as we have been able to discover, it has been uniformly held that in order to justify an order directing service by publication, or personally without the State, the complaint upon which the order is based must show that the plaintiff has a cause of action.” And while our view of the complaint in the Grant case did not-prevail, the principle involved and stated in the Paget case was not overruled. We have here set forth an action in equity to assert and establish a lien based upon an alleged contract, that if the plaintiff gave certain information upon which Helen Bell could institute and maintain and succeed in a suit, she would pay to plaintiff twenty per cent of the results obtained by her under the provisions in her behalf in the deed of trust. Obviously this is not an attorney’s lien. Section 475 of the Judiciary Law (Consol. Laws, chap. 30 ; Laws'of 1909, chap. 35) provides : From the commencement of an action or special proceeding, or the service of an answer containing a counterclaim, the attorney who appears for a party has a lien upon his client’s cause of action * * * and the lien can not be affected by any settlement between the. parties before or after judgment or final order.” -Plaintiff never was Mrs. Bell’s attorney. The complaint alleges that George D. Mumford was her attorney, and that, by said Mumford as her attorney Mrs. Bell began a suit based on the.information given, which .suit was compromised and settled with certain results. The claim . is upon a promise to give information. What is alleged is a sale of information obtained by Holmes through his relation to Mrs. Bell’s father. It is a contract for payment for that information which is set up as the basis of this suit. •

Ho lien is given to counsel. It is- confined to attorneys who have ' appeared.’ (Brown v. Mayor, 9 Hun, 587.) If no attorney’s lien is stated, there is no other kind of a lien set up by the allegation's of the complaint. There was no equitable assignment. In Donovcm v. Middlebrook (95 App. Div. 365) Mr. Justice McLaughlin said: To constitute a valid assignment there must be a perfected transaction between the parties intended to. vest in the assignee a present right in the thing assigned. An agreement to pay a certain sum out of,'or that one is entitled to receive from, a designated fund, when received, does not operate as a legal or equitable assignment, since the assignor in either case retains control over the subject-matter. The test is ’ even of an equitable assignment ‘ whether the debtor would be justified in paying -the debt of the portion contracted about to the person claiming to be assignee.’. (Fairbanks v. Sargent, 117 N. Y. 320.) ‘ It is the settled doctrine in this State,’ says the court in Thomas v. N. Y. & G. L. R. Co. (139 N. Y. 163), ' that an agreement, either by parol, or in writing, to pay a debt out of a designated fund does not give an equitable lien upon the- fund or operate as an equitable assignment thereof.” The court cited also Williams v. Ingersoll (89 N. Y. 508). Ho portion Of the claim was transferred by the contract counted upon, nor was there any provision that plaintiff. should first satisfy himself out of the proceeds and' then pay over the- balance. Hor could there have been, for he is not alleged to have been her attorney or that she contemplated that he should be. He alleges distinctly that he -promised “ that she would pay him for such services, twenty per cent of the results obtained by hen under the provisions i/n her behalf of said deed of trust.” I think, at best, there was a common-law contract, as to the- validity ■ of which, in the eye of the law, there may be doubt. I am of the opinion that the action in equity here set up will not lie; that plaintiff must first obtain a judgment in a common-law action, when he might maintain appropriate proceedings in aid of execution.

It follows, therefore, as the: order appealed from was not founded upon a verified complaint showing a sufficient cause "of action against the defendants to- be served, it must be reversed, with ten dollars costs and disbursements, and the motion to vacate granted, with ten dollars costs.

Ingraham, P. J., Laughlin, Scott and Miller, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs..  