Same - Title Of Assignee

A person cannot acquire title to a chose in action from one who has himself no title to it. And if a man takes an assignment of a chose in action, he takes his chance as to the exact position in which the party giving it stands. In other words, the assignee of a chose in action takes it subject to all the equities of the debtor against the assignor existing at the time he received notice of the assignment.78 If the debtor, for instance, has a right of set-off against the debt at the time of the assignment, he may enforce the right as against the assignee;79 and, as we have already seen, he may enforce a right of set-off acquired after the assignment, but before he received notice of it.80 Since, however, notice thereof completes the assignment as against the debtor, he cannot set off a claim afterwards acquired.81 So, also, if a party is induced to enter into a contract by fraud, and the fraudulent party assigns his interest in the contract, the party defrauded may have the contract set aside in equity in spite of the assignment, and this though the assignee may have paid full value, and may have been wholly innocent.82

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74 Stocks v. Dobson, 4 De Gex, M. & G. 15. See "Assignments" Dec. Dig. (Key-No.) § 57; Cent. Dig. §'§ 116-120.

75 Smith v. Smith, 2 Cromp. & M. 231; Anderson v. Van Alen, 12 Johns. (N. Y.) 343; Meux v. Bell, 1 Hare, 73; Edwards v. Scott, 1 Man. & G. 9G2; Heermans v. Ellsworth, 64 N. Y. 159; Tibbits v. George, 5 Adol. & E. 107; Riley v. Taber, 9 Gray (Mass.) 372; Barron v. Porter, 44 Vt. 587; Dale v. Kimpton, 46 Vt. 76; Bean v. Simpson, 16 Me. 49; Kellogg v. Krauser, 14 Serg. & R. (Pa.) 137, 16 Am. Dec. 480; Guthrie v. Bashline, 25 Pa. 80; Skobis v. Ferge, 102 Wis. 122, 78 N. W. 426. See "Assignments;' Dec. Dig. (Key-No.) § 57; Cent. Dig. §§ 116-120.

76 Tibbits v. George, 5 Adol. & E. 107; Brill v. Tuttle, 81 N. Y. 454, 37 Am. Rep. 515; Switzer v. Noffsinger, 82 Va. 518; Savage v. Gregg, 150 111. 161, 37 N. E. 312. See "Assignments," Dec. Dig. (Key-No.) § 57; Cent. Dig. §§ 116-120.

77 Brill v. Tuttle, 81 N. Y. 454, 37 Am. Rep. 515; Brice v. Bannister. 3 Q. B. Div. 569; Hall v. Insurance Co., 111 Mass. 53, 15 Am. Rep. 1; Whitman v. Arms Co., 55 Conn. 247, 10 Atl. 571; Shriner v. Lamborn, 12 Md. 170; Kitzinger v. Beck, 4 Colo. App. 206, 35 Pac. 278; Schilling v. Mullen, 55 Minn. 122, 56 N. W. 5S6, 43 Am. St. Rep. 475; Ferguson v. Davidson, 147 Mo. 664, 49 S. W. 859. See "Assignments," Dec. Dig. (Key-No.) § 93; Cent. Dig. § 159.

78 Crouch v. Credit Foncier, L. R. 8 Q. B. 380; Mangles v. Dixon, 3 H. L. Cas. 702, 735; Clute v. Robison, 2 Johns. (N. Y.) 595; Littlefield v. Bank, 97 N. Y. 581; Callanan v. Edwards, 32 N. Y. 483; Kleeman v. Frisbie, 63 111. 482; Buckner v. Smith, 1 Wash. (Va.) 296, 1 Am. Dec. 463; Kamena v. Huel-big, 23 N. J. Eq. 78; Spinning v. Sullivan, 48 Mich. 5, 11 N. W. 758; Edson v. Gates, 44 Mich. 253, 6 N. W. 645; Barney v. Grover, 28 Vt. 391; Martin v. Richardson, 68 N. C. 255; Lane v. Smith, 103 Pa. 415; Willis v. Twambly, 13 Mass. 204; Shade v. Creviston, 93 Ind. 591; Goldsborough v. Cradie, 28 Md. 477; Boardman v. Hayne, 29 Iowa, 339; Russell v. Kirkbride, 62 Tex. 455; Hill v. McPherson, 15 Mo. 204, 55 Am. Dec. 142; Third Nat. Bank of Atlanta v. Railroad Co., 114 Ga. 890, 40 S. E. 1016. If the debtor does anything to mislead the assignee, he may be estopped; and in this way the assignee may get a better title than his assignor. Holbrook v. Burt, 22 Pick. (Mass.) 546; Kemp's Ex'x v. McPherson, 7 Har. & J. (Md.) 320; Johnston v. Insurance Co., 39 Md. 233; Woodson v. Barrett, 2 Hen. & M. (Va.) 80, 3

It seems that the parties to a contract may stipulate that, if either assign his rights under it, the assignment shall be "free from equities;" that is to say, that the assignee shall not be liable to be met by such defenses as would have been valid against his assignor.88

Am. Dec. 612; Scott v. Sadler, 52 Pa. 211; Buckner v. Smith, 1 Wash. (Va.) 296, 1 Am. Dec. 463; Boardman v. Hayne, 29 Iowa, 339. Equities which may be interposed as defenses against the assignee of a nonnegotiable instrument are only such as are inherent in the contract evidenced by the instrument, and which exist at the time of the assignment Merchants' Bank of Buffalo v. Weill, 163 N. Y. 486, 57 N. E. 749, 79 Am. St Rep. 605. See "Assignments," Dec. Dig. (Key-No.) § 90; Cent. Dig. § 156.

79 Story, Eq. Jur. § 1047; Cavendish v. Greaves, 24 Beav. 163; Massachusetts Loan & Trust Co. v. Welch, 47 Minn. 183, 49 N. W 740; Greene v. Hatch, 12 Mass. 195; Zabriskie v. Railroad Co., 131 N. T. 72, 29 N. E. 1006; Wood v. City of New York, 73 N. Y. 556; McKenna v. Kirkwood, 50 Mich. 544, 15 N. W. 898; First Nat. Bank of New Windsor v. Bynum, 84 N. C. 24, 37 Am. Rep. 604; Hooper v. Brundage, 22 Me. 460; Hunt v. Shackleford, 55 Miss. 94; Sanborn v. Little, 3 N. H. 539; Littlefield v. Bank, 97 N. Y. 581; Jack v. Davis, 29 Ga. 219. An unmatured debt, existing at the time of the assignment, cannot be set off. Roberts v. Carter, 38 N. Y. 107; Chambliss v. Matthews, 57 Miss. 306; Backus v. Spaulding, 129 Mass. 234; Adams v. Rodarmel,

19 Ind. 339; Graham v. Tilford, 1 Metc. (Ky.) 112; Follett v. Buyer, 4 Ohio St. 586. See "Assignments;" Dec. Dig. (Key-No.) § 100; Cent. Dig. §§ 177, 180.

80 McCabe v. Gray, 20 Cal. 509; Abshire v. Corey, 113 Ind. 484, 15 N. E. 685; Faulknor v. Swart, 55 Hun, 261, 8 N. Y. Supp. 239; Adams v. Leavens,

20 Conn. 73. See "Assignments;' Dec. Dig. (Key-No.) § 101; Cent. Dig. § 182. 81 Goodwin v. Cunningham, 12 Mass. 193; St. Andrew v. Manufacturing

Co., 134 Mass. 42; Weeks v. Hunt, 6 Vt. 15; Crayton v. Clark, 11 Ala. 787. See "Assignments," Dec. Dig. (Key-No.) § 101; Cent. Dig. § 187.

82 Graham v. Johnson, L. R. 8 Eq. 38; Holbrook v. Burt, 22 Pick. (Mass.) 546. But see Bloomer v. Henderson, 8 Mich. 395, 77 Am. Dec. 453. See "Assignments," Dec. Dig. (Key.No.) § 100; Cent. Dig. §§ 117, 180.

83 Ex parte Asiatic Banking Corp., 2 Ch. App. 397. "It is questionable, however, whether such a stipulation would protect the assignee against the effects of fraud, or any vital defect in the formation of the original contract." Anson, Cont (8th Ed.) 238. See "Assignments," Dec. Dig. (Key-No.) § 100; Cent. Dig. §§ 177, 180.