Allhusen v. Caristo Construction Corp.

103 N.E.2d 891, 303 N.Y. 446 (1952)

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Allhusen v. Caristo Construction Corp.

New York Court of Appeals of New York
103 N.E.2d 891, 303 N.Y. 446 (1952)

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Facts

Caristo Construction Corp. (Caristo) (defendant) is a general contractor. Caristo issued a subcontract to Kroo to perform painting as part of Caristo’s general contract. The subcontract contained a provision stating that Kroo was prohibited from assigning any part of the contract or any interest arising from the contract, as well as any “money due or to become due” under the contract, without first obtaining written consent from Caristo. Without obtaining Caristo’s written consent, Kroo assigned the “money due or to become due” under the contract to Marine Midland Trust Company of New York, which in turn assigned the rights to Allhusen (plaintiff). Kroo performed the work as agreed for Caristo, but Caristo refused to pay Allhusen the money due on the contract. Allhusen brought suit in New York state court against Caristo seeking the $11,650 allegedly due for work performed by Kroo. Caristo’s sole defense was that it was not obligated to pay Allhusen, because Kroo’s assignment of its contractual rights was prohibited by the anti-assignment provision in the contract between Caristo and Kroo. The trial court dismissed Allhusen’s complaint, and the appellate court affirmed. Allhusen appealed.

Rule of Law

Issue

Holding and Reasoning (Froessel, J.)

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