17 Mo. App. 44 | Mo. Ct. App. | 1885
Lead Opinion
Opinion by
In this case the plaintiffs asked twenty instructions, of which the court gave eight. The court also gave twelve instructions on behalf of defendant. We are asked in this case to review all those refused and those given. The habit of counsel in thus multiplying instructions, has time and again been animadverted upon and censured by the supreme court. But instead of curing the evil practice, it seems to be on the increase. If the court decline to accept the pressing invitation of counsel to look carefully and minutely through such a labyrinth of propositions to discover, if possible, some inconsistency
The case seems to have been tried throughout by the' plaintiffs on the theory that the motive and intent of the defendant in making the deed to Tootle, Hosea & Co. was' the main issue, • and so the instructions given by the court, as well as those refused; placed the case principally on the theory that if defendant intended to prefer one creditor to another, and to postpone one creditor until another was paid, etc., it was sufficient to maintain the attachment.
As, under the undisputed facts of record, the deed in' question, whatever it may be called, had been fiiade, and the real ground of controversy is as to the effect of the instrument, the inquiry should be limited to the seventh clause of section 398 of the Attachment act.
That inquiry isHas the defendant fraudulently conveyed or assigned his property -or 'effects so as to hinder' or delay his creditors? If this deed was fraudulent in and of itself, as matter of law it would be a fraudulent conveyance or assignment within the meaning of said section. And if the judgment of the law denounced it as fraudulent, it would support that allegation of the affidavit. — Reed v. Pelletier, 28 Mo. 177.
The intent, the motive which prompted the conveyance or assignment, in the absence of a secret trust or understanding dehors the instrument, could have no effect, because the intent to defraud might have been entertained by the grantor and yet the legal effect, of the deed make valid the conveyance, so . that as matter of law it would and could not hinder or delay any creditor.
It is to be borne in mind that the intent,- the motive of the grantor, is applied only to instances under the 5th and 6th clauses of said section concerning attachments. So Richardson, J., in Reed v. Pelletier, supra, said:
*55 “There are thirteen cases in which an attachment may issue under our statute, and it will be observed that the ‘intent’ of the party liable to the writ is not a necessary ingredient except for the causes enumerated in the fifth and sixth clauses of the first section. The affidavit will be good if it follows the language of either of the clauses, and it is never necessary to prove more than the party is required to swear to. If the attachment is based on either the seventh, eighth, ninth, or tenth clauses, it will be sustained on proof that the defendant fraudulently had or was about fraudulently to do any of the prohibited acts; and whether the act be fraudulent will depend on the judgment which the law pronounces upon it.”
This section of the statute again came under review; in the supreme court of this state in the case of Bullene v. Smith (73 Mo. 151), where the proposition is well sus-' tained that each of the several clauses of said section presents a separate, distinct, and independent ground of attachment; and that the legislature did not employ the several specified grounds as convertible terms. Each enumeration constitutes a cause of action and each of the terms employed possesses its own peculiar meaning and office in law. Therefore, the supreme court holds that a fraudulent disposition of property will not support a charge of a fraudulent conveyance or assignment, and vice versa.
Now there is no just pretence in the case at bar of any other attempt to transfer the property in question, than what is expressed or consummated by the written instruments in evidence. All other allegations, therefore, of fraud contained in the affidavit and the issues taken thereunder, may be eliminated from this inquiry. Nor does the proof, giving to it the most rigid scrutiny. in quest of the evil design of the defendant, in our judgment warrant any jury in finding there existed in the breast of the defendant any purpose inconsistent with' the language employed in the written instrument. We fail to discover in this record any tangible proof of the
The fact that the deed contains a provision that any surplus remaining after the satisfaction of the grantor’s debts should be returned or paid to him, cannot be held .to be a fraudulent reservation to his use as against creditors, for that is precisely what the law, in the absence of any such stipulation, would direct. He reserves to himself no interest as against any of his creditors or the assignee, but only stipulated that the surplus, if any after satisfying all of his creditors, should be returned to him. This the law would accomplish for him with or without such express provision. And what the courts would enforce cannot be held to be fraudulent. — Burrill on Assignments, 4 ed. sects 206, 207..
This case, in this respect, is unlike that of Bigelow et al. v. Stringer et al. (40 Mo. 195), in its facts. There it appeared on the face of the deed that the debtor had conveyed an amount of property largely in excess of the aggregate of his debts; and by the very terms of the instrument, he tied up his property in the hands of the trustee, postponing his general creditors, for two years, manifesting thereby a purpose to secure to himself an increased surplus; again, by delaying and hindering his creditors in the collection of their debts. That was a fraud in law apparent on the face of the instrument. We fail to discover in this record, fairly and reasonably interpreted, any such disparity between the value of the property conveyed and the aggregate of the defendant’s debts as would warrant the impeachment of the deed on .that ground. In fact it is not too much to say, on this record, in view of the actual results of sales of such property under trustees or assignees, that if the creditors should realize the amount of their debts it would be quite unusual.
Nor are we able to perceive how the fact of the execution of the bill of sale, which Campbell induced the defendant to make, after the execution, delivery, and
The issue, on trial, being: had the defendant.fraudulently conveyed or assigned his property or effects so as to hinder or delay his creditors, it mattered not what opinion the grantor or assignor entertained as to the import of the terms employed in the instrument of conveyance. Its construction and effect are for the court as a question of law. If, as a matter of law, the effect and operation of the deed constituted an assignment for the benefit of creditors generally, pari passu, it is difficult to conceive how it can be said the defendant has fraudulently assigned his property so as to hinder or delay his creditors. The law, on the contrary, favors such assignments, as they operate for the protection and equality of all the creditors. — Milliken v. Dart, 26 Hun. 24.
There does not appear to be any serious controversy between counsel that the legal effect of the deed is an assignment under the statute; and such, we are of opinion, is its correct construction. — State ex rel. v. Benoist at al., 37 Mo. 500, 508; Burrill on Assign., sects. 2, 3, et seq.; Page v. Smith, 24 Wis. 371, 372; Lord v. Devendorf, 54 Wis. 491; Norton v. Kearney, 10 Wis. 443.
Campbell appears to have qualified as assignee under
Should the plaintiff maintain his action he thereby seeks to accomplish that of which he complains, a preference over the other creditors, — an inequality and injustice which it is the design of the assignment law to prevent. It is held in New York that an attachment cannot be levied on property in the hands of an assignee under a general assignment of the debtor, notwithstanding the assignment is fraudulent in law. — Thurber v. Blank, 50 N. Y. 80; Smith v. Longmire, 24 Hun. 257.
Appellants make the objection to the assignment that the assignor failed, at the time of the execution of the instrument, to make a statement accompanying it, as required by statute. — Rev. Stat. sect. 362. The deed was executed and put to record on the 6th day of December, and the required statement was made on the 8th. We do not think this delay of the assignor would defeat the conveyance in favor of the creditors, as they had no control of the assignor in performing a duty imposed on him by the statute, after the making of the deed.— Hardcastle v. Fisher, supra; Duvall v. Raisin, 7 Mo. 499; Robert v. Casey, 25 Mo. 590.
We are of opinion that on the real issue .in this case the plaintiffs had a fair trial, and that the ends of justice will be best subserved by affirming the judgment of the circuit court, which is accordingly done.
Rehearing
On motion for rehearing:
Opinion by
As many of the questions raised in the motion for rehearing have been fully considered and determined in the opinion filed herein, we • will notice only such additional suggestions as are deemed material.
“An assignment for the benefit of-creditors may be made to a single individual or to several.” — Burr on Assignments, sect. 91, 4th ed. And when it is made to-several it is not essential to its validity that, all should accept. Only those who do accept .are required to act. An assignment to partners is good, and the acceptance of', of the trust by one of the firm is sufficient. — Burr on Assignments, sect. 91; Forbes v. Scannel, 13 Cal. 243-288.
II. It is next insisted that Campbell did not qualify as-such assignee until after the attachment was sued out, and that he did so only because coerced thereto by attachment proceedings. The statute..prescribes what action the assignee shall take, and the time in which ho shall qualify. The deed was delivered to Campbell, and by him put to record before- the levy of the writ of attachment. This, without more, would be evidence of acceptance under our statute, where the assignee had taken possession of the property. — Price v. Parker, 11 Iowa 144; Forbes v. Scannel, 13 Cal. 287. The statute, section 355, allows the assignee fifteen days within which-to file his inventory, and by section 362 he is allowed three days, after filing the deed for record, to give bond as such assignee. This Campbell did within two days-after filing the deed, .and within three days from its.
The overzealous plaintiffs rushed in and seized the ■goods in the hands of the assignee before the statutory period had elapsed for filing the bond as assignee, and now their counsel assert that he did so only because of their hasty action. Admit that Campbell and Cissna ■contended that the deed gave Tootle, Hosea & Co. a preference, and that they said they would not regard it as a -deed of assignment, how could this fact justify the .attachment proceedings? Cissna had already made a ■ deed of assignment. Campbell had accepted it, recorded it, and taken possession of the goods. The plaintiffs Anew this fact when they sued out the writ of attach•ment. The statute then imposed on the assignee the ■ duty to qualify as such by giving the bond and filing the inventory. He yet had three days in which to. act. Plaintiffs had their plain remedy and recourse, if he failed to qualify and administer the trust. The courts never permit a trust to fail for the want of a trustee. — Shockley v. Fisher, 75 Mo. 502; Burr on Assignments, 268. ■ One of the grounds, and the chief one, on which assignments for the benefit of creditors are supported is, “that ■ courts of equity can compel the fair and faithful execution of the trusts they create. . . . After the assignee had taken possession of the property, the title and trust be- ■ came fixed and executed, and it was not in the power of the assignors to defeat ox affect it.” — Forbes v. Scannel, supra.
Counsel in the discussion of this case seem not only to ■overlook the fact that deeds of assignment are favored
“The rights of creditors are fixed by the assignment,, and without their knowledge or consent cannot be varied, by any subsequent act of the assignor or assignee. If. valid in its creation, no subsequent fraudulent or illegal acts of the parties can invalidate it.” — Burr on Assignments, sects. 26N351, and citations. As is said by Wagner, J., in Valentine v. Decker (43 Mo. 544): “Where' an assignment is fair and valid, the legal estate or title will pass to the assignee without any assent expressed, by the creditors, and neither a subsequent judgment or lien creditor will acquire any interest in the property assigned, nor can he attack the assignment unless upon the ground of fraud. This doctrine flows from the common-law rule, that it is not necessary to the creation of a trust by deed in favor of any persons, that the cestui que trust should either be a party or assent to it. If the trust be for his benefit, the law presumes his assent to it till the contrary is shown. Such trusts have always been executed on the idea that the deed was complete when executed by the parties to it.”
III. We are referred by counsel to Bump on Fraud, where he says: “The instrument must stand or fall upon the character impressed upon its face by the parties, and by them sent out to the world as expressing the contract and purposes of the parties to it.” We think the learned
IY. It is in this connection that we are referred by the motion for rehearing to numerous decisions of the supreme court of this state as having been overlooked by us in writing the opinion herein. •
These cases all bear upon the doctrine of estoppel in pais. But we are' unable to conceive how the plaintiffs can invoke the doctrine of estoppel against the defendant. ■ They were not content with what Campbell and ¡Cissna said about the sale, but their attorney demanded ¡to see the evidence of the transfer,- which was exhibited ¡to him. The original was then on record. ' There was no 'concealment. The deed spoke for itself. The parties had impressed upon its face the nature of their arrangement. 'Even to the unlearned in- the law, the maxim applies that every one is presumed to know the law, and we may be pardoned for applying it to the instance of one learned in the law. On its' face it was a deed of- assignment, executed and recorded, and it was not in the power of the parties to alter, modify, of evade it without the consent of these very plaintiffs. The very basis of an estoppel in pais is fraud. The representation relied upon Ymust have been made with the knowledge of the truth
The whole truth of this matter is, that the plaintiffs misconceived the character and legal effect of the instrument of conveyance, and brought their attachment on the idea that it was a mere deed of trust, improperly attempting to prefer one creditor to the hurt of another; and because the plaintiffs did not know their rights they want the deed interpreted as they understood it.
V. It is claimed that the court did great injustice to counsel for plaintiffs in the opinion in saying that they had tried the case below, throughout, upon the question of the- intent of defendant in making the deed, whereas In fact they “argued for a reversal against such construction being put to the jury.” We have re-examined the instructions asked by the plaintiffs, some of which the court gave, and we again assert, that in fourteen instructions asked, the question of the defendant’s intent in making the deed is made the foundation of recovery by plaintiffs; and the court was asked to declare to the jury, in one or more instructions, that if the defendant designed by deed to prefer Tootle, Hosea & Co., they should find for plaintiffs.
YI. Among the many controlling decisions of the supreme court, with which our opinion is alleged to conflict, is that of Potter v. McDowell (31 Mo. 69). In our humble-opinion, the case is in perfect harmony with the views expressed by us in the opinion under review.
Scott, J., says: “The l'aw does-not concern itself with the private or secret motives which may influence the debtor. It does not deal with his conscience. He may make the deed with the most upright intentions, really believing that he has the right to do so, and yet if that deed was voluntary and hinders and delays creditors, it-is fraudulent.”
YII. I apprehend that some confusion often exists, in-the minds of both judges and counsel in dealing with these questions, in confounding the grounds of attachment under our statute with the action to set aside deeds-under the statute concerning fraudulent conveyances. Under the latter statute, “the intent to hinder, delay, or defraud creditors of their lawful actions” is made the gist of the action. But under the former statute, as we-attempted to develop in the opinion herein, the imputed fraudulent conveyance must be such as to hinder or delay creditors.
And on farther reflection and consideration we are persuaded that it is a contradiction in terms to say that a deed which amounts to an assignment under our statute, and operates for the benefit and protection of all the-creditors of the debtor, can be held to hinder or delay creditors. As no motive or purpose of the grantor can possibly thwart its operation, or interrupt,, or divert it»
Speaking for myself, I very much question whether property in the hands of an assignee under a deed of assignment is the subject of seizure under an attachment. In the hands of the assignee it is in custodia legis, and not amenable to process. But it is not necessary to go so far in this case.
Yin. We reaffirm, also, after a re-examination of the evidence in this .case, that there is nothing in this record which would warrant any jury in finding that there was any “trick or contrivance to defeat creditors,” outside of the deed, which it was designed to promote or aid.
Counsel lay much stress upon the fact that there was evidence tending to show that Campbell had promised Cissna that he would'“stock up the goods.” Campbell testified that he told Cissna it was his intention to “stool?; up the goods,” but it was not his agreement, and that he did not do so because Cissna did not ask him to do it. There was no evidence that it was to be done out of the proceeds of the stock conveyed, or that there was to be any delay in foreclosing the trust. And- it is not conceivable that if the assignee, out of his own funds, should have bought new goods and put with the old to aid and enhance their sale, how any creditor could have justly complained. But it is sufficient to say, that the deed being an assignment, the statute prescribes the precise course of procedure by the assignee; and it was not possible for him to so conduct the trust so as, in contemplation of law, to hinder or delay any creditor. There was nothing on the face of the deed to make it inoperative as an assignment; and that is the end of this controversy.
We may not inappropriately conclude this review by applying the language of Lord Ellenborough in Pick-
It is, therefore, with little grace that plaintiffs now complain, if their attachment is not maintained, they will lose all, as they cannot be admitted to share in the distribution under the assignment after assailing it.— Valentine v. Decker, 43 Mo., supra.
Duos qui sequitur lepores, neutrum capit.
The motion for rehearing is denied.