127 N.Y. 508 | NY | 1891
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *510
The relief sought by this action at law, as appears by the complaint, was founded upon the charge that the defendant, intending to injure the plaintiffs and to prevent their having satisfaction of their judgment, wrongfully, collusively and fraudulently commenced its action, and by collusion with the officers or agents of the Syracuse Iron Works obtained its offer to allow it to take judgment therein, accepted it and caused judgment to be entered and execution to be issued and levied upon the property of the iron-works; and that with the like intent afterwards wrongfully caused the property to be sold by virtue of such execution issued upon the judgment, which, having been so obtained in fraud of the statute, was void, by reason whereof the lien of the plaintiffs upon the property was defeated, lost and destroyed. And for the support of the action the plaintiffs relied upon the statute, which provides that: "Whenever any incorporated company shall have refused payment of any of its notes, or other evidences of debt * * * *513
it shall not be lawful for such company, or any of its officers, to assign or transfer any of the property or choses in action of such company, directly or indirectly, for the payment of debt; and it shall not be lawful to make any transfer for assignment in contemplation of the insolvency of such company to any person or persons whatever; and every such transfer and assignment to such officer, stockholder or other person, or in trust for them or their benefit, shall be utterly void." (1 R.S. 603, § 4.) The purpose of the statute was to deny to insolvent associations the right to give preference to any of its creditors, or, in contemplation of insolvency, to transfer its property. When the defendant proceeded to take judgment against the iron-works, the commercial paper of that company had been protested and the company was insolvent. And it may be assumed that the offer of judgment to the bank was made to give it an unlawful preference, and, so far as it could be, it was accomplished by the judgment entered upon the acceptance of the offer and the issuing of execution to the sheriff; and the preference sought by the iron-works to be given the defendant was in violation of the statute. (Kingsley v.First National Bank of Bath, 31 Hun, 329; Throop v. Hatch L. Co.,
Without considering any other question, these views lead to the conclusion that the judgment should be affirmed.
All concur, except VANN, J., not sitting.
Judgment affirmed. *517