Forbes v. Scannell

13 Cal. 242 | Cal. | 1859

Baldwin, J. delivered the opinion of the Court

Field, J. concurring.

Suit brought to recover damages of defendant for taking certain teas. The case is one of more than usual interest and importance. It involves principles novel in their application in this State, and it has been ably and fully argued at the bar and upon briefs. The general nature of the suit may .be thus stated: Eye Brothers & Co. were a mercantile firm, composed of citizens of the United States, residents of, and doing business in, Canton, China, before and on the 11th March, 1856, On that day they failed, when Gideon Bye, Jr. one of the firm, the only resident partner, and managing the affairs of the house at Canton, appeared before Oliver H. Perry, United States Consul at Canton, and signed and acknowledged before the Consul this instrument in writing:

“Be it known, that on the eleventh day of March, a. d. eighteen hundred and fifty-six, before me, Oliver H. Perry, Consul of the United States of America, at Canton, China, personally came and appeared Gideon Bye, Jr. a citizen of the United States of America, and at present a resident of the city of Canton, China, and a partner in the commercial house of Messrs. Bye Brothers & Company, residing, transacting, and doing business in the city of Canton, China, and being the only partner in said commercial house of Bye Brothers & Company here present, and requested me to note, that he desires to assign, and does assign, all and singular the real and personal property belonging and appertaining .unto the said commercial house of Bye Brothers & Company, whether situate in China or elsewhere, jointly unto Messrs. Russell & Company, a commercial house residing and doing business in Canton, China, and unto James Purdon & Company, also a commercial house, residing and doing business in the said city of Canton, China, in trust and for the benefit of each and all the creditors of the said Gideon Bye, Jr. and the said commercial house of Bye Brothers & Company, and the said appearer declared that he reserves to himself sufficient time to record in this Consulate a full and complete schedule of all the assets and liabilities, whether appertaining and belonging to him personally, or appertaining and belonging to the said commercial house of Gideon Bye, Brothers & Company, of which he is a partner, as aforesaid.

Gideon Bye, Jr. for self and

Bye Brothers & Co.

Boted before me on the eleventh day of March, a. d. eighteen hundred and fifty-six, at the hour of two, p. m. this day, in faith whereof I hereunto sign my name and fix my seal of office.

Oliver H. Perry, U. S. Consul, [l. s.] ”

That at the time of executing this instrument, Eye Brothers & Co. were largely indebted to the citizens and residents of China, and to citizens and residents of the United States, and those of Great Britain, and also to citizens of the United States and Great Britain residing at Canton. The merchandise in controversy was shipped by Eye Brothers & Co. from Canton, to Morgan, Hathaway & Co. at San Francisco, in the ship called the “ Berreda Brothers,” before their failure in March, 1856, and that the “ Barreda Brothers,” returned to Canton after the failure, from stress of weather, when the plaintiffs took actual possession of the goods as assignees under the before mentioned assignment of Eye Brothers & Co. and shipped them directly to Morgan, Hathaway & Co. for sale, with instructions to account to them as such assignees for such proceeds, and the seizure of these teas was made by the defendant while in the possession of Morgan, Hathaway & Co. under the consignment of the assignees. After the execution of the assignment, a controversy arose between one A B, a citizen of the United States residing at Canton, and these assignees, before O. H. Perry, U. S. Consul at Canton, in which was involved the question whether or not the assignment was valid; and the Consul held, for reasons given in his judgment or opinion, which is to be found in the record, that it was, and that an assignment, made after insolvency, which divides the assets with perfect equality among all the creditors, is considered by the Court, under its equity jurisdiction, as a valid trust, and will be sustained. That the assignees have, by general and special circulars, notified the creditors and others dealing with the house of Eye Brothers & Co. of the state of the assets and liabilities, and their business as assignees in the execution of their trust is still unsettled. The defendant seized the goods by a valid execution, issued on a valid judgment, in favor of F. Huth & Co. v. Nye Brothers & Co. defendant knowing of plaintiffs’ claim.

Some other facts appear in the record. These relate mainly to the question of fraud in fact, in the assignment, and will be noticed when we come to consider that subject. The case was tried by the Judge below, who made a finding of facts and legal conclusions, and gave judgment for plaintiff for the amount claimed. The defendant appeals from the judgment.

The first point made by the Appellants is that this assignment is void. The argument in favor of this general proposition is, that by the 39th Section of our statute for the relief of insolvent debtors and protection of creditors, (Wood’s Digest, 501,) an assignment of this character is absolutely void; that upon this subject, our own legislation has declared a State policy, and that while effect will bo given in the Courts of a State to contracts entered into beyond its jurisdiction, this general rule is not based upon any absolute right in a party to such enforcement of the contracts, but is a mere regulation of international comity, and this comity will not be exercised when it is opposed to the interests or declared policy of the State of the forum. And the conclusion of the learned counsel is, that this case falls within the exception just given. There would be more force in this view, if this were an executory agreement to make an assignment in this State, of this character, or if this property were within this State at the time of the assignment. But here the contract, such as it was, was executed beyond the jurisdiction. The property was beyond this State—the parties, also3 the actual possession taken, and the title vested in the foreign jurisdiction. The property came into this State with the full effect—whatever that was—which the contract made abroad impressed upon it. It is not even shown that at the time of that contract the property was agreed, or intended to be shipped, as assigned property, to this Statej on the contrary, at the time of this assignment, the teas were at sea 3 they were taken possession of on the return of the vessel, by the assignees, and again transmitted. It cannot be pretended that this policy of our statute is anything more than a conventional rule, established for the regulation of a certajn class of contracts and interests. The rule itself is not of natural obligation. It is considered here as the safer and better rule; it is considered else- • ' where, and by the common law, as not as conducive to the public welfare as a contrary rule. It does not occupy a more favorable position in this respect than our Statute of Frauds, requiring certain contracts to be in writing in order to prevent perjury, and yet we presume no one would contend, that because, under our system, we refused to give effect to any other contract than one so evidenced, we would refuse to enforce a contract, valid in the place where made, because not executed according to our statutory modes; and especially would it not be contended, if a right of property had vested under such law, in the foreign country, that we would not recognize the title here. The truth is, we do not consider this question as one of comity at all. It is a pure question of property. By our general laws, we recognize the duty of government to protect property, and that is property which is acquired by contract, lawful and effectual, to pass title in the place where it is made. It might as well be said that if a man made his money by usury, in California, and carried it into Pennsylvania, the Courts of that State would refuse to recognize his right, because usury is against the policy of Pennsylvania. Or if won at cards in Mexico, where no laws exist against gaming, it would cease to be his property whenever brought into this State.

If this property had been sold by these assignees in China to third persons, it is not a question that the title would be upheld here if the property vested abroad and had been brought here by the purchaser. Why ? Because the attributes of property ■—a thing acquired by a legal mode of acquisition—had been impressed on it—where, is wholly immaterial, or, probably, by what law, unless, indeed, the Courts had to give effect to some worse principle than a rule of the common law of England, or violate some better declared public policy than a section of the statute regulating modes of assignment of property here. The authorities cited have no application to the facts here. The early cases in Massachusetts maintain only the doctrine that where the property is within the State, the Courts will not allow a contract operating on it to be made in another State, the effect of which is to dispose of the property differently from the mode provided in Massachusetts. In other words, Massachusetts will not suffer her own resident creditors to be prejudiced in favor of foreign creditors, by giving the debtor the right to assign the property in the State contrary to the mode she has prescribed for assignments. But Massachusetts has never held that when the property is in Mew York, and there assigned, and the assignee legally vested with the title, she will not recognize the title when the property is brought within her jurisdiction.

It is hard to see by what rule.of justice or of policy, Huth, a citizen of London, could claim from the laws of California any greater privileges than he could obtain from his own Courts if this proceeding were pending in England.

The Appellants contend that, in the absence of any proof of the law of the place of contract, our own law must be presumed to prevail, and they cite several authorities which seem to maintain this doctrine. This presumption, if it be one, would present a curious illustration of a fact presumed to exist, when in every single instance, probably, in which the application is made of the presumption, i.t would falsely represent the real fact. That China had ever passed or given effect to the 39th Section of our insolvent law is rather a violent intendment, but possibly the principle invoked was necessary, as some rule must be had for the determination of matters of litigation, and the convenience or necessity of the case constrains the adoption of the one nearest at hand when the foreign rule is unknown. (See 2 Hill, 202; 12 La. 465 ; 13 Mass. 147.) Having shown possession and control of this property in China, or on the seas, and the property having been brought into this State by the plaintiffs, by a law of universal application a title prima facie good is shown by the plaintiffs. Upon that title so proved, without showing anything more than this possession, the plaintiff would be entitled to recover for a seizure of it in this State, unless the defendant showed a better title in himself or in some person whose right he legally represented. To prove this title ho is forced to assail the validity of this assignment. The burden of proof is on him to show the invalidity,of it, and, as the invalidity rests upon its illegality, and this depends upon the proper construction of the law of the place of contract, he assumes the responsibility of showing what that law is and how this transaction opposes it. But the Appellant answers this position by the not'«very satisfactory appeal to the principle of presumption already adverted to, to wit: That the law of the forum is to be taken to be the law of the place of contract, and calls upon the Respondent to show that it is different. We are not satisfied that the rule invoked is properly applicable to such a state of facts as this; that to rebut an inference of title from possession acquired in a foreign country, a party can refer to a local statute of the forum, and demand, as a presumption of law, that the contract under which liis adversary claims was made subject to its provisions. But, as the facts are all before us, probably the principle is not important enough to the decision to require us to consider it at length, or to pass upon it; for, when all the facts are before the Court, and they are undisjmtod, it is not very material ujion which party rests the onus of proof. The solution of this difficulty is attempted by the Respondent, who asserts, in answer to this argument, that the real lex loci, quoad this transaction, is the common law of England, that law, in effect, having been established by the treaty between the United States and China, of July 3d,-1844, negotiated by Mr. Commissioner Cushing, and by the Act of Congress passed on the 11th of August, 1848, for the purpose of carrying into effect the provisions of the treaty. This leads us to an examination of the extent and validity of this regulation, since it is claimed to exercise an important, if not controlling, influence over this litigation. It is provided in this treaty that questions between citizens of the United States in China shall be subject to the jurisdiction and be regulated by the authorities of their own government. And this principle seems to be the same which obtains as to British subjects domiciled in that empire. It seems that American citizens residing for the purpose of trade in the ports of China are not regarded as subjects of that government, but that for purposes of government and protection, they constitute a kind of colony, subject to the laws and authority of the United States. An interesting-letter from Mr. Cushing to Mr. Calhoun, then Secretary of State, dated September 29, 1844, was written in illustration of this treaty. He says: “ The Consuls of Christian States, in the countries not Christian, still retain, unimpaired, and habitually exercise, their primitive function of municipal magistrates forth cir countrymen; their commercial or territorial capacity in those countries being but a part of their general capacity as the delegated administrative and judicial agents of their nation.

* * * In China I found that Great Britain had stipulated for the absolute exemption of her subjects from the jurisdiction of the Empire, while the Portuguese attained the same object through their own local jurisdiction at Macao. I deemed it, therefore, my duty, for all the reasons assigned, to assert a similar exemption on behalf of the citizens of the United States. This exemption is agreed to in terms by the letter of the treaty of Wang Hija5 and it was fully admitted by the Chinese in the correspondence which occurred contemporaneously with the negotiation of the treaty. By that treaty, thus construed, the laws of the United States follow its citizens, and its banner protects them even within the domain of the Chinese Empire.

* * * In extending this principle to our intercourse with China, seeing that I, have obtained the concession of absolute and unqualified exterritoriality, I considered it well to use in the treaty laws of such generality in describing the substitute jurisdiction, as while they held unimpaired the customary, or law of nations, jurisdiction, do also leave to Congress the full and compíete right to define, if it please to do so, what offices, with what and in what fcjjrm of law, shall be the instruments for the protection and regulation of the citizens of the United States.”

Mr. Cushing, (Opinion of Attorney-General, Vol. 7, 501,) shows that the treaty, besides conferring on American citizens in China exterritoriality in commercial matters, provides, in respect to civil matters : 1. That questions arising between citizens of the United States, in China, shall be subject to the jurisdiction and regulated by the authorities of their own government. 2. That in controversies between a citizen of the United States and China, the authorities of the two governments are to have concerted action. 3. That in controversies between the United States citizen and other persons, not Chinese, the adjustment is to be regulated by the international relations of the United States and the Government, or State of that other person.

To give effect to this treaty, the Act of August 11, 1848, was passed by Congress. The “ authorities ” of the United States, were by this Act directed in respect to their duties and the manner of performance, and the new jurisdiction regulated and defined. The system of administration was constituted by: 1. The ■ laws of the United States, so far as suitable to carry the treaty into effect. 2. The common law, in all cases where the laws of the United States are hot adapted to the subject, or are deficient in the provisions necessary to furnish suitable remedies. 3. Decrees and regulations, by the Commissioner, which shall have the force of law, and supply such defects and deficiencies as still remain to be supplied, and the regulations, orders, and decrees, made by the Commissioner, with the advice of the several Consuls, must be transmitted to the President, “ to bo laid before Congress for its revision, but to be binding until annulled or modified by Congress.” The first three sections of this statute give to the Commissioners and Consuls the judicial authority necessary to execute the provisions of the treaty, without, however, distributing it among them; but according to Mr. Cushing, this duty of distribution was left to the regulation of the Commissioner and Consuls, under the general power in the statute to which we have referred. These undistributed powers embrace the general doctrine and scope of what, in our system, constitutes equity jurisprudence, and some matters of more special jurisdiction—as insolvency—habeas corpus, etc. On the second of October, 1854, Bobert M. McLane, being the United States Commissioner to China, with the advice of the United States Consul, issued a decree distributing the judicial power, by which jurisdiction was vested in the Consular Court over equity matters, trusts, etc. After enumerating the heads of jurisdiction, this regulation proceeds : “As to trusts, equity will superintend and protect the creation of trusts, whether vesting in the Trustee real or personal estate, and take jurisdiction of trusts, whether resulting from an express deed pr the force of circumstances and the situation of the parties, which latter are implied trusts.” It will thus be seen that the Commissioner and Consuls constitute a judiciary for the government of the citizens of the United States in China, and as such, and when so acting, are governed by the law of nations, the laws of the United States, the common law, and the decrees and regulations of the Commissioner, until the latter are modified or annulled by Congress. There having been no express modification or change of the common law, in respect to any rule applying to this matter, by the laws of Congress or otherwise, the rules of the general system known as the common law would seem to prevail over this subject.

It is suggested, though no great stress seems to be laid upon the objection, that Congress had no constitutional power to provide a system so organized and for such objects. But wo are not disposed so to hold. It would require an extremely clear case of repugnancy to the Constitution of the United States to justify us in holding unconstitutional such a power of protection to American citizens—a power alike essential to tho maintenance of friendly relations with a State like China and to secure the rights of our people there, and one, moreover, so long recognized as well by our own government in other instances, as by other Christian powers in their intercourse with such nations.

The general authority given to Congress to regulate commerce -with foreign nations could, probably, find no more useful or appropriate means of exercise than in treaties and laws withdrawing our citizens domiciled in unchristian nations from tho jurisdiction of such governments, and confiding their rights of property and person to judicial officers of their own country, administering, under responsibilities to a common government, laws, with the general spirit and principles of which those citizens are familiar. That government would be weak, indeed, which could not, in this peaceful and unobjectionable mode, with the assent of the foreign power, exercise this wholesome protection and restraint over its own citizens abroad. The case of Dred Scott, (19 How. 449,) maintains no such doctrine as that it is cited to sustain; but the general principles there declared seem carefully to exclude the construction given, and to limit their operation to the territories “ within the dominion of the United States.” In The People v. Gerke, (5 Cal. 381,) this Court, in giving effect to the treaty with the kingdom of Prussia, which had direct effect on property in this State in opposition to its laws of descent, went further than it is necessary to go to uphold the treaty and laws in question. Mr. Justice Bryan said in this case: “ So far as the authority of the Federal Courts is concerned, they appear to have uniformly administered the law upon the meaning given by construction to the language of the treaty, seeming never to have, in any respect, doubted the power of the General Government 'to provide by treaty with a foreign power for the mutual protection of the property belonging to the citizens or subjects of each in the territory of the other. The treaty-making power of the Federal Government must, from necessity, be sufficiently ample so as to cover all of the usual subjects of treaties between different powers. If we were to deny to the treaty-making power of our government the exercise of jurisdiction over the property of deceased aliens, upon the ground of interference with the course of descents or the laws of distribution of a State where property may exist, by parity of reasoning we should not make commercial treaties with foreign nations, because, it might be said, some of their provisions would injure the business of a portion of the citizens of one of the States of the Union.

If the treaty-making power which resides in the Federal Government is not sufficient to permit it to arrange with a foreign nation the distribution of an alien’s property, then that power resides nowhere, since it is denied to the States, and we must confess our system of government so weak and faulty as to be incapable of extending to its citizens in foreign lands that protection which is most common among a majority of modern civilized nations.”

In Siemssen v. Bofer, (6 Cal. 250,) the doctrine of People v. Gerke was doubted by the late Chief Justice; but the decision has not been expressly overruled. ¡Numerous cases sustain the general principle and reasoning upon which Gcrke’s case rests. (See 4 Wheaton, 453, and the other cases cited in Respondent’s brief.)

In the second place, it is urged with much earnestness that this assignment is void, because no means of enforcing the trusts against the assignees exist in the local jurisdiction. It is said that the only ground upon 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. But as Huth & Co. English creditors, could not go before the American authorities, they would be without any relief. As this is a matter of local law, pertaining to the lex loci contractus, the Appellant should show, as against an assignment seemingly otherwise authorized, the existence of this cause assigned for its invalidity. It is not to be presumed a priori, that any system of jurisprudence could be so defective as to withhold some remedy for so flagrant a breach of duty, as the refusal to comply with the obligations of such a trust. We think the point is not sustained. So far as these Consular Courts exist at all, as such they are Courts of the United States, into which, by the general law, an alien friend may enter for redress against a citizen of the country of which the Court is an appendage. Mr. Cushing places this subject in a very clear light. He says: “The Chinese will go into the United States Consular Court as plaintiff, and that Court will take jurisdiction of the defendant as an American; and where the demand is by an American against a Chinese, the former must, of necessity, be content with such judicial or executive action of the Chinese Government in the premises as appertains to their institutions, and as, by application, may be required on the part of the United States.

As to the other cases, that of controversies occurring in China, between citizens of the United States, and subjects of any other (Christian) government, the treaty provides that the same ‘ shall be regulated by the treaties existing between the United States and such governments, respectively, without interference on the part of China.’ (Art. 25.)

How, we have no special treaty with any of these governments on this point, nor is any needed, or necessarily required, or intended by stipulation under consideration. With all wo have treaties of amity, or of ordinary commercial and social intercourse, and that suffices to meet the exigency.

By the tenor of those treaties, as they are construed by the law and usage of nations, an Englishman has the right to sue a resident of America, or an American a resident Englishman, as alien friend, in all places wherever, respectively, the jurisdiction of the other country exists locally, and is comjdete as to subject matter, persons, and remedial forms. (Fœlix, Dr. Intern, Prive. Tit. 11, Ch. 2.)

The jurisdiction of the United'States is complete, as to their citizens in China, and the jurisdiction of Great Britain is complete as to her subjects in China. That the jurisdiction in each case is exterritorial—that in China it is excepted from the local territoriality, and that it is outside of the territoriality of either Great Britain or the United States—is a fact wholly immaterial to the question. It is a question free of all doubt on principles of international right, and subject only to the single inquiry whether the given country, each proceeding in established legal forms, by whatsoever authority such forms be established, has conferred on its Courts of justice in China jurisdiction ad hoc, or whether that remains to be done.

Here, again, the statute is explicit and ample. It confers on the Consular Courts jurisdiction of ‘ all civil cases arising under said treaty/ A demand of an Englishman against an American is a civil case arising under the treaty, as we see.

Therefore a suit may ho brought by the Englishman against the American in the Consular Court of the United States, as, undoubtedly, in the Consular Court of Great Britain, it may, consistently with public law, be brought by an American against an Englishman.

If the Englishman were within the territorial jurisdiction of the United States, he might sue, but would also be subject to suit, in the local Courts, as the American might and would be in England. (Fœlix, Ubi Supra.) Bay, a suit would lie in the Courts of Great Britain or the United States, between residents, both being aliens in the country. (Fœlix, Ubi Supra.)”

The regulations adopted by the Consular Courts of the United States are made part of the case. The second rule provides that “ when a citizen of the United States, who is a resident in China, or any subject of the Emperor of China, or the citizen or subject of any other State or nation, may have a right to bring suit against a citizen of the United States, in the United States Consular Court in China,” etc. etc. If Hnth & Co. being Englishmen by residence, wished to sue such of these assignees as were Englishmen, residing in China, in respect to this assignment, we presume there would be no doubt that the local jurisdiction of Great Britain in China, which seems to be similar to ours, would be competent to afford adequate relief.

Having reached the conclusion that the law governing this assignment, and determining its validity, is the common law, it remains to consider the objections urged against it in connection with that system. We understand by the “common law,” as used in the Act of Congress, and applied to the arbitrament of controversies between citizens of the United States, that general body of law, which, as Judge Marshall expresses it, is constituted “ by those general principles and those general usages which are to be found, not in the legislative Acts of any particular State, but that generally recognized and long established law which forms the substratum of the laws of every State,” i. e. every State carved out of the British Colonies. We may look to American as well as English books, and to American as well as English jurists, to ascertain what this law is, for neither the opinions nor precedents of judges can be said, with strict propriety, to be the law—they are only evidence of law. Mr. Cashing, in the same opinion from which we have quoted, (Vol. 7, 504, Opinions of Attorney-General,) says : “ By ‘common law/ (in the Act of 1848,) is intended that law which is to be found in the decisions of the Courts of Justice of the United States, both Federal and State, as distinguished from that law which is found in the statute law of the United States and of the States.” And this language is incorporated in the Begulations by Commissioner McLane.

The Appellants claim that the assignment by this common law is void upon its face, for several causes which will be examined hereafter. But the Eespondents say, by way of answer in limine, that this matter is foreclosed, because the Consular Courts at Canton passed upon this question in a controversy there pending, in which case the Consul, Mr. O. II. Perry, held that the assignment was valid. It is urged that the decision of this Court is as conclusive of the questions of local law decided as would be that of any other Court as to the law of its jurisdiction. There would be more force in this argument if the Consular Court were the highest judicial Court of the jurisdiction, but it seems that an appeal lies from the Consul to the United States Commissioner. And we are not aware that the rule which accords the force of definitive exposition of the local law to the decision and judgment of the Courts of the local jurisdiction has ever extended so far as to give that sanction to the judgment of a subordinate tribunal of the municipality or territory. The decision of the Consul is, doubtless, entitled to some weight, but we are not prepared to hold it as conclusive of the general question adjudicated by him. We proceed to consider the objections to this instrument:

1. That it is not the deed of Nye, or Nye Brothers & Go. but it is the paper of the Consul, Eye merely signing his name in attestation of the act of the Consul.

We think there is no weight in this objection. In order to make a trust it is enough that the trust be declared by the jjarty to be charged and signed by him—this seems to havg been done.

2. “ That it is the act of G. Eye, Jr. alone.” But it purports to be the act of the firm, and is signed in the firm name. It is urged that there was no delivery shown. But this may be inferred from the acts done and the nature of the transaction, the claim made under the trust, the possession of the paper and of the property. This is not a deed; it is a mere parol assignment and trust. We are not aware of any rule requiring a delivery, as in formal deeds, as necessary in such cases. The making of the trust and its acceptance are sufficient, especially if accompanied or followed by the possession of the property. As no conditions are imposed on the creditors, an acceptance by them is presumed upon the general principle that a party is presumed to assent to acts done for his benefit. (Nicholl v. Mumford, 4 John. Ch. 522 ; Burr, on As. 308.)

3. It places the individual creditors of Eye on a par with the firm creditors in the distribution of the firm assets.”

We do not so construe the paper. It is true the assignment is of the property of G. Eye, and of the firm, for the payment of his individual debts and the debts of the firm. But the assignment must be taken and the property administered in reference and according to the rules of law prevailing in the place of contract, and one of the rules of equity jurisprudence is, that the individual property must go to the individual creditors in priority to the firm creditors, and firm assets must go to the firm creditors in priority to the individual creditors of a partner; and there is nothing in the language of this deed which, when taken in connection with the principle, indicates or would give effect to a contrary construction. Eor do we concede that the misdirection of the property, which might be corrected in equity, would ipso facto vacate the deed, though it is not necessary, nor do we decide the point.

4. Eor is the trust void, as alleged, because it is not more fully or particularly declared. A trust of assets or property for creditors of itself suggests specific and well defined duties, and imposes specific and well defined obligations upon the Trustees. They are to hold and take care of, sell, and dispose of the property, so as to convert it, with convenient speed, into money, and distribute and pay the proceeds over to those entitled. This duty and this responsibility would not have been more plainly enjoined or created by express language, giving in detail, the course of management and direction of the subject of the trust. What is vague in the contract is made certain by the law, and both are to be taken together.

5. We think the objection that the assignment was revocable is not well taken. After the assignees had taken possession of the property, the title and trust became fixed and executed, and it was not in the power of the assignors to defeat or affect it.

6. The objection to the style of designating the Trustees is not well founded. The Trustees must be designated, but whether by a firm name, or the individual name is not material, if the language used be such, as with certainty, to indicate the persons who are nominated as Trustees. It is not necessary that all the Trustees should assent to act as such. The presumption is of assent, and the assent of one is enough to give effect to the trust, though the rest expressly repudiate. (2 Kent’s Com. 533, Notes and Cases there cited.)

7. The want of a schedule of the property is sometimes regarded as a circumstance of fraud, but the absence of a schedule has never, we believe, been held sufficient of itself to avoid a conveyance of this sort;

8. The next ¡proposition is, that the deed is inoperative because one partner has no power to make an assignment of the firm property without the assent of the other partners.

It seems that G. Mye, Jr. was the only resident partner at Canton, and on the eve of some protested bills returning from London, made this assignment without consulting his associates. It is not easy to reconcile all the authorities upon this subject, and able jurists seem divided in opinion in regard to it. Wo think the weight of authority is in favor of the power. The case of Harrison v. Sterry, (5 Cranch,) expressly affirms it, and the facts of that case are very analogous to this. In Anderson v. Tompkins, (1 Brock. 458,) Ch. J. Marshall reaffirms the doctrine, Deckard v. Case, (5 Watts, 23,) is the same way. The reasoning of Mr. Justice Rogers "states with great clearness the principle on which the doctrine rests. He says : “ It is a general principle of the law of partnership that the partners are bound by what is done by each other in the course of the partnership.business. They are considered as virtually present at and sanctioning the contracts they singly enter into in the course of trade, and each is vested with the authority to act at the same time as principal and as the authorized agent of his copartner.

Among the powers most ordinarily exercised' by partners is the jus disponendi, or the power which each partner has individually of disposing of the joint stock or merchandise. When the assignment is Iona fide, I cannot doubt the power of one partner to transfer the whole as well as apart of the partnership effects.” This doctrine was reaffirmed by the same Court in Hennessy v. State Bank, (6 Watts & Serg. 310.) The able and learned author on Contracts and on Mercantile Law and Partnership, after collecting all the American cases on this question, concludes : “ If necessary for the protection of creditors, an assignment of all the pei’sonal property to a Trustee for their benefit by one partner, if his copartner is absent and cannot be consulted in season, and has, either expressly or by implication, left to him the sole management of the business, is valid.” (Parson’s on Mer. Law, 175, Note 1.)

It seems to us that the proof tends in this case to establish this precise state of things. Situated in a foreign country, at a great distance from the other partner residing there, we can scarcely conceive a condition in which the implication of the largest discretion ever confided to a partner would more properly result. The other partners do not seem to complain. Indeed, there is some evidence of their subsequent express assent, and the particular exigency existing appears to.be sufficient to have authorized the action of the acting partner.

We have already extended this opinion to such length as forbids a detailed examination of other points. We have examined those not especially noticed, and must content ourselves with merely announcing the conclusions to which we have arrived, which are in accordance with those of the Judge below.

The last point to be noticed is, the charge of fraud in fact. The Judge has passed upon those matters of proof, and we see nothing to constrain us to reverse his judgment upon them.

The appointing of Rye, Jr. as Agent, with some compensation—the allotting of some furniture to the wife—the want of a schedule, and the control, such as it was, exercised over the joint affairs by Rye after the assignment, do not, in the absence of any proof of original fraudulent design, raise even a presumption of fraud, in fact, when all the circumstances are considered. Some of these suspicious circumstances are explained —the schedule was subsequently made; there would seem nothing very suspicious in getting a partner conducting a large firm, whose business was extensive and complicated, to assist assignees in bringing the assets to profitable account; to aid in collections and settlements and explaining the affairs; and the compensation was necessary, probably, to get the services of a bankrupt who seems to have surrendered all his property; the compensation seems not extravagant; the furniture was allowed the wife at the instance of many, perhaps the majority, of the creditors, and there is no proof that these subsequent acts, of benefit to Nye or his family, by the assignees wore promised, or even contemplated, at the time of the assignment. We could not, upon such evidence, infer a fraud which is not presumed to exist by the law, much less do we feel disposed to overturn the decision of the Court below upon the facts on such proofs.

It is unnecessary to criticise the findings. Enough is found to which we see no good exception, to justify the conclusion, viz: the validity of the deed; the possession of the assignees; no fraud in fact; the levy and seizure by the defendant, and the value.

Judgment affirmed.

Case Details

Case Name: Forbes v. Scannell

Court Name: California Supreme Court

Date Published: Jul 1, 1859

Citation: 13 Cal. 242

Court Abbreviation: Cal.