18 Barb. 549 | N.Y. Sup. Ct. | 1854
It is true the assignment in this case declares that the trustees shall not be! answerable for the acts, neglects or defaults of any attorney or agent that they may appoint, nor for any misfortune, loss or damage which may happen without their willful default; but this is followed by an express covenant on their part to accept the trust and to act faithfully and justly in the execution of the same. The two parts of the trust deed are to be taken together, and if the trustees were sued for any fraud committed under the deed, or for any thing indicating a breach of faith towards creditors, the deed itself, on its face, would show their liability, if such wrong in fact were proved. The deed, then, cannot be fraudulent on its face, and there was no pretense that it was fraudulent in fact. It Was argued that
The judgment should be affirmed, with costs.
Roosevelt, J., concurred.
This is an action to set aside an assignment as fraudulent and void against creditors. The plaintiff maintains that it is void on its face, in consequence of the following clause: “ The parties of the second part shall be charged and chargeable only with and for so much money and property as they shall respectively receive, and shall not he answerable or accountable for the acts, receipts, neglects or defaults of any attorney or attorneys, agent or agents, that they may employ, nor for any misfortune, loss or damage which may happen, without their willful default.”
Here, then, by the operation of the instrument itself, they are exempted from all responsibility in the employment of agents. However careless, however indifferent they maybe in the selection of suitable and trustworthy persons to serve them in performing their trust, they are relieved from all care as to the consequences. They may employ a man utterly incompetent, without inquiry about his qualifications or his character, and if he waste or plunder the property, they are not legally involved, if this instrument shall be sustained; and beyond the mere moral obligation there is no inducement whatever for the faithful performance of their duties; except so far as their own debt is concerned, which, as usual in cases of this nature, is preferred. They are also exempted from all responsibility on account of any misfortune, loss or damage, except what may arise from their willful default. A trustee being under an obligation by his acceptance of the trust to husband the property confided to him with the care and diligence of a provident owner, is liable for every loss sustained by reason of his negligence, want of caution, or mistake, as well as for positive misconduct or willful default. The law would not excuse him, even if he managed the
The clause at the end of the instrument, binding the assignees “ to act faithfully and justly in the execution of the trust,” does not counteract the effect of the preceding clause, which releases them from all accountability for' the want of ordinary care and diligence. The whole language of the assignment should be taken together; and they may well say, if brought to an account, for the consequences of mistakes or omissions, which ordinary prudence and forecast could have averted, that they did not, nevertheless, act unfaithfully or unjustly; because, by the express terms of their trust, they were only chargeable for any misfortune, loss or damage, which may happen by their willful default. Under that part of the clause exempting the assignees from all care in the appointment of agents, it could also be easily contrived that the assignor himself should have the actual management of the trust; for the trustees could, without much difficulty, and without making themselves amenable for willful default, select some confederate of the assignor, who would connive at his interference; and thus these subordinate agents could make any disposition of the property, although entirely at variance with the professed object of the assignment; the trustees, in the meantime, escaping all liability, unless a positive and willful violation of duty could be proved against them,
At the present time, certainly, the law will not relax the rules relating to assignments. Every provision in these instruments, which may enable the debtor, or his assignees, by the operation
It is admitted by the counsel for the plaintiffs, that the judgments stated in the answer were duly recovered by Allen and Paxson, the assignees, and that the amounts for which they were rendered were due. It becomes a question, then, whether they have a right to set off their claim oh Beck, and to apply the proceeds of the assigned property to the payment of their judgments against him.
It has been usual, where assignments have been set aside as fraudulent by reason of some objectionable provision on their face, as in this case, to allow the trustees all payments made by them to the other creditors, previous to the commencement of the action, and also all necessary expenses and disbursements incurred in collecting and converting into money the property and effects assigned, It is admitted that the assignees received, under the assignment, between the recovery of the plaintiff’s judgment and the commencement of this action, seventeen hundred and eighty-six dollars, and previous to the plaintiff’s judgment, two thousand one hundred and fifty-nine dollars, and, since the commencement of this action, five hundred and twenty-three dollars and forty-two cents. It does not appear that they have applied this amount to the payment of the claims of any other creditors. In analogy to the general practice in such cases, I think that it would be proper to allow the assignees to apply
Judgment affirmed.
Mitchell, Roosevelt and Clerke, Justices.]