Nesmith v. Drum

An equitable assignment is an agreement in the nature of a declaration of trust, which a chancellor, though deaf to the prayer of a volunteer, never hesitates to execute when it has been made on valuable, or even good consideration. Could there be a more explicit declaration than the order before us ? Drum and Collins draw on their lawyer for the proceeds of an action against Hawkins, which they declare in the order to have been appropriated to payment of their note in the Warren Bank, on which Wheelen, the payee, was one of their sureties. If this appropriation was a condition of the contract of suretyship, it rested on a valuable consideration; if it was not, it rested on a good one, which is equally available. Drum and Collins were bound to secure Wheelen by putting funds into his hands to take up the paper at maturity, if they should not; and in giving this order they yielded to a moral obligation, which is a consideration for an express contract. The appropriation, then, being complete as an assignment of the fund by the agreement of the parties, even without the acceptance of the drawee, could not be revoked.

Judgment affirmed.