Ackerman v. Cross

40 Barb. 465 | N.Y. Sup. Ct. | 1863

By the Court, Bacon, J.

The facts in this case are mainly conceded, and admit of no complication, and being once ascertained, the principle of law applicable to them seems to me by no means difficult or recondite. The plaintiffs are the assignees of Curry, McCandlish & Field, a firm residing and doing business at Bellville, Canada West, on the 10th of June, 1861. The plaintiffs were residents of the same place, and the assignment, which was executed and delivered at Bellville, on the 10th of June, 1861, was a general one, for the benefit of creditors. The firm was insolvent, and it is conceded that the assignment was valid in Canada, and would by the courts of that province be held effectual to vest the title of the assigned property in the assignees. All the property assigned was at Bellville, except the particular property which is the subject of this action, which at the time of the assignment was in store at Cape Vincent, having been shipped by the former owners to New York; but retained at Cape Vincent under a warehouse lien. On the 11th of June, 1861, one of the assignors made a formal delivery thereof to the plaintiffs, and it was allowed by them to remain in the warehouse, subject to their orders and the lien existing thereon.

On the 11th of June, 1861, the defendants Denison & Wyckoff commenced a suit on a demand then held by them against Curry and others, and obtained an attachment, by virtue of which, the defendant Cross, as sheriff, seized the property, then being at Cape Vincent, and subsequently a judgment was duly rendered in that action, and upon an execution issued thereon, the property was sold and bid off by Denison & Wyckoff. This action is brought by the plaintiffs as assignees, to recover the value, and a recovery is resisted by the defendants, upon the ground that the assignment not having been acknowledged, filed or recorded in this state, nor being in other respects in conformity with the act of 1860, it could not operate to convey property in this state, against a valid attachment of a creditor of the assignors, and a citizen of this state; and that in order to the validity of an assignment since that act, as it respects property in this state, the assignees must be residents of this state, and within the jurisdiction of its courts.

The learned referee who tried this cause held, as a conclusion of law, that the assignment was a valid instrument, and was operative to, and did pass to the plaintiffs as assignees the property in questionm this suit; and that being thus invested with the title they were entitled to recover the value, for which he ordered judgment in their favor. The soundness of this conclusion it seems to me admits of no question, and it is founded on a principle as simple, .as it is almost elementary. It is expressed clearly and tersely by Judge Denio, in Parsons v. Lyman, (20 N. Y. Rep, 112,) as follows: “It is an established doctrine, not only of international law, but of the municipal law of this country, that personal property has no locality. It is subject to the law which governs the person of the owner, as well in respect to the disposition of it by act inter vivos, as to its transmission by last will and testament, and by succession upon the owner dying intestate.” “ The principle,” he adds, “no doubt has its foundation in national comity, but it is equally obligatory as a rule of decision in the courts, as a legal rule of purely domestic origin.” It seems to follow very clearly from this principle, that voluntary transfers of personal property, wherever in point of fact the situs of the property itself may be, are controlled and regulated by the law of the owner’s domicile, and if valid there to transfer a title, are valid every where else. In truth I hardly know a respectable authority—certainly there is none in this state—that questions this proposition. The only struggle in our courts has been to determine whether the rule applied to the case of a compulsory assignment, as for instance under a decree in bankruptcy pronounced by a foreign tribunal.

Story, (Confl. of Laws, § 411,) states this as the distinction between the two cases, when he says, the one is a voluntary conveyance, and the other is a conveyance by operation of law in invitum. A statutable conveyance, made under the authority of the legislature, cannot operate upon any property except that which is within its territory. “And this,” he says, “makes a solid distinction between a voluntary conveyance by the owner, and an involuntary legal conveyance by mere authority of law. The former has no relation to place, the latter, on the contrary, has the strictest relation to place.” And from this follows the inevitable corollary, that “a voluntary assignment by a party, according to the law of his domicile, will pass his personal estate wherever may be its locality, abroad, as well as at home.” This principle is very distinctly recognized by several cases in our. own courts, and among others in Johnson v. Hunt (23 Wend. 96,) and in Hoyt v. Thompson, (1 Seld. 352,) where Paige, J. repeats the language of Story in respect to the distinction between a compulsory legal assignment and one which is voluntary, and adds, “the control of the owner of personal property has no respect to its locality. He can dispose of it wherever it may be.”

An attempt was made at an early day, by Chancellor Kent, to extend the principle to the length of recognizing and enforcing the claims of foreign assignees under the English bankrupt act. He not only admitted, but insisted upon the proposition, in the broadest terms, that the succession to and disposition of personal property is regulated by the law of the owner’s domicile, and he sought to extend the principle to an involuntary assignment ■ by force of law, by considering the act as in effect the party’s, own, since it was in execution of ■ laws by which he was bound, and he voluntarily committed the act which authorized the making of the assignment. (See Holmes v. Remsen, 4 John. Ch. 487.) This reasoning has a certain air of plausibility, but it is essentially unsound, as is. shown by Story, when he says that “in the same way it might be said that a man committing a crime for which his estate is forfeited, voluntarily consents to its transfer.” The principle, whether correct or not, can only apply to cases where the debtors and creditors are both residents of the same country. (Confl. of Laws, § 413.)

The doctrine* of Chancellor Kent was dissented from in an elaborate opinion of Judge Platt, in the supreme court, in the 'case of Holmes v. Remsen, (20 John. 229,) in which he maintained the true rule to be that statutory assignments as to creditors should only operate infra territorium. The other judges neither concurred in nor dissented from this opinion, as the decision of the case turned entirely on another point in which they all agreed. In the case of Abraham v. Plestoro, (3 Wend. 538,) in the court of errors, the whole doctrine is entirely overruled, and a majority of the court uuited in the proposition that an assignment under the bankrupt act of England does not operate as a legal transfer of the property of the bankrupt in this country, following in this respect the decisions of the supreme court of the United States in Harrison v. Sterry, (5 Cranch, 289,) and as between the several states, that of Ogden v. Saunders, (12 Wheat. 358.) Similar decisions have been made in other states of the union, and so preponderating is the weight of authority, that Chancellor Kent in his Commentaries, has with great candor admitted that the doctrine in this country is now established in opposition to his early opinion. (2 Kent’s Com, 408, 3d ed.)

Cases are cited by the defendants’ counsel from the courts in Massachusetts, JSTew Jersey, Louisiana, &c. to sustain the principle that the lex fori in respect to the transfer of personal property prevails over the law of the owner’s domicil, but it is not important to spend time in their examination, since they are not controlling authority with us, and their effect is substantially neutralized by the fact that in Maryland and Pennsylvania, and in the courts of the United States, decisions of a decidedly opposite character have been made; and however respectable the tribunals that hold this view may be, they cannot countervail what I conceive to be the well settled principle with us, that a transfer of personal property which is valid by the law of the owner’s domicil will operate as a transfer to be regarded and upheld in all places. A voluntary assignment for the benefit of creditors, I need not say, stands in this respect upon the same footing, and the assignees are entitled to assert the same rights as purchasers in any other form from the original owner.

This is the principle declared by Justice Strong in Tyler v. Strang, (21 Barb. 198,) when the subject of the transfer was property in the state of Pennsylvania, and he held that the assignor and assignee being both citizens of this state, and the assignment executed here, both the validity and effect of the assignment, and the delivery and change of possession necessary to sustain it, depended entirely upon our laws; in other words the lex loci contractus governs.

Moore v. Willett, (35 Barb. 663,) is still more in point It was the case of a voluntary assignment made by an insolvent debtor in North Carolina. It contained a clause not obnoxious to the laws of North Carolina, but which by the well settled law of this state would have rendered the assignment, if it had been executed here, fraudulent and void. The property assigned was a vessel then at sea on a voyage to New York. On her arrival at that port she was delivered _ into the possession of the plaintiffs, who were the assignees, and immediately levied upon by the defendant, as sheriff, on an execution upon a judgment against the assignor, who lived in North Carolina. Judge Ingraham, in his opinion, discusses two propositions: 1. Whether a foreign assignment can convey title" to property here, so as to give it effect against a creditor here who has seized the property under an attachment or execution; and 2. Whether provisions in the assignment, good where it was executed, but rendering it void in this state, destroy its efficacy and validity here. These two propositions, it will be seen, cover the whole ground taken in this case, and the features of the two cases are very nearly identical. The decision upholds the title of the assignee in all respects, and was placed upon the principle that the assignment being valid by the law of the place where it was executed, it was good every where, and the party holding under it could assert dominion over the property conveyed, wherever it might be found.

It is true that the vessel was at the time of the execution of the assignment upon the high seas, and the court mention this as a fact adding strength to the plaintiffs’ title, but it is manifest that in the light of the principle which is applied to the case, the decision would have been the same if the vessel had in point of fact been lying in the port of New York at the moment the assignment was executed.

I need hardly say that if an assignment will be upheld here which contains a provision which the policy of our laws utterly condemn, but which is saved from that condemnation by the consideration that it is good by the law of the place of its execution, the fact that the assignment in this case did not conform to the requisition of the act of 1860, will not affect its validity in our courts. These requirements are essentially formal and modal, while the vice in the other case is far more deep and radical. It has been suggested indeed, if not held in some cases, that our statute in these respects is directory merely, and the omission of the things required by the act does not affect the validity of the assignment. It is not important to express any opinion on this point, since if the broad proposition is conceded that the assignment would have been declared void if it had been executed by a citizen of this state to assignees residing here, it does not impair the title of the plaintiffs in this suit, derived from an assignment valid and effectual by the laws of Canada, where all the parties to the assignment resided at the time of its execution.

[Onondaga General Term, December 22, 1863.

The judgment is right and must be affirmed.

Allen, Mullin, Morgan and Bacon, Justices.]