
    John E. Coles, Appellant, v. Philip W. Saitta, Respondent.
    (Supreme Court, Appellate Term,
    January, 1911.)
    Contracts — Interpretation of contract — Particular agreements — Agreements for payment out of proceeds.
    Orders — Acceptance — Construction.
    In an order drawn, by one who ships oranges from Mexico to a sales agent in Mew York, upon the sales agent to pay the purchase price of the orange boxes out of the proceeds of the sales, the word “ proceeds ” will -be construed to mean the net proceed-s after deducting freight, duties and other charges and expenses in bringing the oranges to the Mew York market.
    But it appearing from the evidence, in an action against the sales agent on the order, that he had received subsequent amounts from the auction company who sold the oranges, the burden rested upon the sales agent to show that these sums so received were insufficient to repay the advances theretofore made or liabilities theretofore incurred by him for freight, duties and other charges and advances.
    Appeal by the plaintiff from a judgment of the City Court of the city of New York dismissing the complaint.
    J. Harry -Snook, for appellant.
    Philip S. Saitta (George A. Baker,- of counsel), for respondent.
   Giegerich, J.

The plaintiff, a manufacturer of boxes, was requested by one Tinaglia to sell him, on credit, certain • boxes to be used in packing oranges for shipment from Mexico to New York. This plaintiff at first refused to do; whereupon Tinaglia introduced plaintiff to the defendant, who was an importer of oranges doing business in the city of New York. Tinaglia had made an arrangement with the defendant, under which the former was to ship his oranges from Mexico to the defendant in New York and the defendant was to sell them in this market for the account of' the shipper.

Plaintiff having refused to extend credit to Tinaglia for the boxes in which the oranges were to be shipped, the defendant suggested that a way out of the difficulty would be for the plaintiff to procure an order from Tinaglia directing the defendant to pay the plaintiff’s bill out of the proceeds of the sales of the oranges to be shipped. This suggestion was acted upon. Tinaglia signed such an order, which plaintiff transmitted to the defendant. The orange boxes were shipped to Tinaglia, who has not paid for them, and this action is brought to recover their prices from the defendant.

The order signed by Tinaglia was in the following form:

New York, August 1 *lth, 1908.
P. W. Saitta
“ 258 Broadway, N. Y.:
Dear 'Sir.— Please pay to Coles & Co. from the proceeds of sales of my fruit $775.00 and charge same to my account. This is as per agreement between you and Mr. Montague of Coles & Co.
“ Yours very truly,
“ Joseph H. Tinaglia.
“ P. S. The above covering the amount of my purchases of 5000 orange boxes with straps from Coles & Co.”

At the trial, plaintiff proved the facts shortly stated above and also proved that the defendant had received from the auction house at which the oranges were sold over $7,000 as proceeds of the several auction sales.

At the close of the plaintiff’s case, the court dismissed the complaint.

Plaintiff’s theory is that, by virtue of the order signed by Tinaglia and transmitted to the defendant, an equitable ■assignment of the proceeds of the sale of the oranges was effected to the extent of SITS; and he claims that he was entitled to go to the jury upon the question whether the word “ proceeds ” in the 'Order meant the gross or the net proceeds of the sales. -Counsel for the defendant concedes that the order of Tinaglia was sufficient to effect an equitable assignment of any balance of the proceeds of the sales which may have remained in the defendant’s hands after deducting freight, duties and other charges and expenses incurred in -bringing the oranges into the Hew York market; but he argues that, as- the plaintiff has failed to show that' there was any such balance of the proceeds of sale, no cause of action was made out.

There was nothing for the jury to pass upon in regard to the meaning of the word “ proceeds ” contained i'n the order. It is obvious that, when the parties used the word, they referred to the actual proceeds of the consignments and that there were no such proceeds until freight, duties and all other necessary expenses incurred in order to put the goods in a position to be sold had first been deducted from the price realized at the auction sales. If this were not plain as a matter of interpretation of the contract, however, it would still be true that, as the plaintiff’s rights depend solely upon an assignment from Tinaglia, and not upon any direct obligation of the defendant, the plaintiff can only stand in Tinaglia’s shoes. Consequently, if there was nothing due from the defendant to Tinaglia after satisfying the necessary expenses connected with the transaction, there was nothing for the assignment to operate upon.

I am of the opinion, however, that, when the plaintiff established the fact that the defendant had received several thousand -dollars from an auction company as proceeds of the sales of the oranges by that company, he had made out a prima facie case. It was for the defendant then to have met this proof by showing, if he could, that the moneys received from the auction company were insufficient to repay the advances theretofore made, or liabilities theretofore incurred by him for freight, duties, advances to the shipper by payment or acceptance of drafts drawn against the shipments and so forth. These matters of account were peculiarly within the knowledge of the defendant, and I do not think that it was any part of the plaintiff’s case to go further and show what the proper charges of the defendant amounted to and what the balance was. The trial judge ruled otherwise and for this error I think the judgment must be reversed and a new trial ordered, with costs to the appellant to abide the event.

Judgment reversed and new trial ordered, with costs to appellant to abide the event.

Brady and Gavegan, JJ., concur.

Judgment reversed.  