58 F. 161 | 8th Cir. | 1893
(after stating the facts.) In the petition of intervention ©r interpiea filed by Peter J. Scales, all the right or title claimed by him in or to the attached property or its proceeds was that held by Mm as assignee of Isaac H. Milligan, under the deed of assignment of March 14, 1891. Me did not claim to be a purchaser in Ms own right for value of the property. If the money realized from the sale of the attached property, and now under the control of the trial court, through the possession of the receiver appointed in the case, is paid to the defendant in error, in pursuance of the judgment rendered by the court below, the same will be held by Scales, in trust, for the benefit of the parties named in the deed of assignment to him, who are individual creditors of Milligan. The ultimate question at issue on the trial was whether Scales, as assignee of Milligan, was rightfully entitled to the attached property or its proceeds, in order that he might use the same in paying the creditors of 'Milligan. The trial court instructed the jury that the deed of assignment from Milligan to Hcales was valid on its face; that it vested the legal title to the property in dispute and the possession thereof in the interpleader, Peter J. Scales; that if Milligan took back the stock of merchandise previously sold to Geren & Wilson, because of their failure to pay the indebtedness they had agreed to pay, and in order that he might dispose of the stock and pay Ms own debts, then the bill of sale to him was not an assignment, but that if, in fact, it was an assignment for the benefit of creditors, it was void under the law; and that if subsequently Milligan made an assignment of these goods for the purpose of paying the debts contracted in their purchase with the knowledge of Geren & Wilson, or if they ratified his act after the same was done, then the transfer of the property from Geren & Wilson to Milligan could in no wise affect the validity of the assignment from Milligan to the interpleader. The instructions given to this effect were excepted to, and the giving thereof is assigned as error.
The effect of the instructions given the jury was to eliminate from the case the question of the title held by Milligan under the bill of sale executed to Mm by Geren & Wilson. The evidence shows without contradiction that in December, 1890, Geren & Wilson bought the goods and business from Milligan, paying him in cash §800, and agreeing to pay the balance due Mayfield from Milligan.
If, according to the view of the court below, this conveyance was absolutely void, then Milligan took no title (hereunder. The title remained in Geren & Wilson, and Milligan held the mere, possession of the property as their agent or trustee. If, however,; the conveyance to Milligan was intended to be an assignment for (he benefit of the creditors of Geren & Wilson, Hum the title passed, to Milligan as trustee, charged with duties and obligations both to! Geren & Wilson and their creditors. In neither view of the case' did Milligan become vested with the absolute ownership of the prop-i erty, nor could he repudiate the dudes of his position of trustee,' and be thereby enabled to convey the property to Scales as his; assignee, and charge the property with a trust in favor of his individual creditors. Certainly, Milligan could not himself lawfully use the property received in trust in the payment of his individual debts, and what he could not lawfully do himself he could not empower his assignee to do. Under the instructions given by the court, the jury could find only in favor of the interpleader, and the practical effect of the judgment rendered upon the verdict is to hold that Scales, as assignee of Milligan, is entitled to the proceeds of the attached property, in order that he may pay the same to the creditors of Milligan. We fail to find upon the record any evidence which sustains the theory that the property passing to Milligan by virtue of the conveyance from Geren & Wilson became his property, so that he could lawfully appropriate it to the payment of his own debts; and hence the ruling of the court below that the deed of assignment executed by Milligan conveyed the title and possession of this property to Beales was clearly erroneous, and requires a reversal of the judgment entered in the circuit court. A number of other assignments of error are made and have been discussed
Reversed at cost of defendant in error, and cause remanded to the court below, with instructions to grant a new trial.