15 Barb. 56 | N.Y. Sup. Ct. | 1852
The only questions presented by the bill of exceptions grow out of the terms of the assignment; the defendants insisting that upon its face it is void. The first point relates to the occasion, cause or consideration of its execution, as stated in the recital. The recital is as follows: “ Whereas James W. Backus is justly indebted, in sundry considerable sums of money, and has become unable to pay and discharge the same with punctuality or in full, and the said party of the first part is desirous of making a fair and equitable distribution of his property and effects among his creditors.” The defendants insist that it is only insolvency that will justify an assignment for the benefit of creditors; that the insolvency must appear either by recital or by proof. The counsel conceded that if the fact of insolvency was recited it would be prima facie sufficient to support the assignment; and by this concession I think he yielded the entire ground. For there is no proposition better settled than that recitals in deeds are not evidence against strangers or third parties, and are only evidence between parties and privies. So that whether the fact be recited is entirely immaterial.
Barney, v. Griffin (2 Comst. 365,) cited by the counsel for the defendant, was the case of an assignment for the benefit of a portion only of the creditors, showing a surplus after payment of the debts provided for, and providing for a payment of that surplus to the assignor; and it was held fraudulent. The court held that the parties having provided for a surplus were es-topped from alleging that there was no surplus. The same principle was decided in Goodrich v. Downs, (6 Hill, 438,) but the principle of these cases is not applicable to this. Had it appeared in this case, either by recitals in the assignment or aliunde, that the assignor supposed himself solvent, and made the assignment to prevent a sacrifice of his property, it would have been fraudulent. The intent to hinder and delay creditors would have been apparent. (Van Nest v. Yoe, 1 Sandf. Ch. Rep. 4.) The recital is not inconsistent with insolvency, but on the contrary it avers, the inability of the assignor to pay his debts in full, and expresses a desire to distribute his property
The next objection to the assignment is that it is general of “ all and singular the goods and chattels, merchandise, bills, bonds, notes, book accounts, claims and demands, dioses in action, books of accounts, judgments, evidences of debt and property of every name and nature whatever,” and that no inventory accompanied the assignment or was made, at the time, or provided by the assignment to be made. The ground taken is that the assignment is void for uncertainty, in that it gives no description or inventory of the property, or any means or clue whatever by which creditors can ascertain what it was, or what their rights and interests were. As between assignor and assignee the description is sufficient to pass the title to and vest it in the assignee; and although the objection is for the want of certainty, the reason assigned in the objection, and the entire argument, pointed to the fact as an evidence of fraudulent intent, as showing a design to protect the property that might chance to be discovered by a vigilant creditor, and yet retain the power, in the debtor, to conceal it, if he could, and appropriate it to his own purposes. The grantor in a conveyance as special as this could not object that nothing passed, because of the generality of the terms employed. And if he could not, the objection could not be taken by third persons. As a badge of fraud, it is not necessarily to be regarded as showing a fraudulent intent, and is in no case conclusive. The exception in this case is to the refusal of the judge to hold the assignment void in law for this reason. In Van Nest v. Yoe, cited above, Assistant Vice Chancellor Sandford, speaking of a similar objection, taken in that case, says: “ This is not of itself a strong badge of fraud, but frequently becomes one, in connection with other circumstances.” Sterns v. Bull, (6 Mass. Rep. 339,) was an assignment to certain creditors and sureties of the assignor to indemnify them, the surplus to be accounted for to the assignor, and the
The remaining objection is founded upon the power granted to the assignees to take possession of the assigned property
It cannot be held, without doing violence to these rules, that the assignment in this cause authorizes a sale upon credit. The words employed can be fully satisfied far short of conferring this power. They must mean “ such terms and conditions” as are consistent with the rights of creditors, and the duties of the assignees and the rules of law, as well as those that should appear for the best interest of the parties concerned; the direction being to convert the property into money, and not into debts against third persons. It would be sufficient for me to say, here, that the same question was before us in Pratt v. Corbin, decided in January last. We there held that a power in precisely
W. F. AMen, Hubbard arid Pratt, Justices.]
the same terms did not authorize a sale upon credit, and did nót therefore- hinder-or delay creditors. The same was substantially decided in Meacham v. Sternes. The same clause was contained in the assignment in Hitchcock v. Cadmus, -and although it is not particularly referred to, the justice who decided the case held that it directed a sale of the assigned property without delay, and that it was a valid assignment. In Massachusetts it* has been held that authority to an assignee to sell the assigned- property at public or private sale, in such manner and at such times as the trustees might consider expedient, was an authority to sel-1 upon credit. (Neally v. Ambrose, 21 Pick. 185.) This was in an action against assignees, to charge them with the property sold upon credit, and the court held that the assignees had not transcended their authority, and were not liable to the action. This is in direct conflict with Meacham v. Ciernes, which is binding as an authority with us, and in our judgment is well sustained by principle.
There is no complaint that the cause was not properly submitted to the jury, with proper instructions. The judgment must be affirmed.
Judgment affirmed.