17 N.Y.S. 926 | N.Y. Sup. Ct. | 1891
The plaintiffs seek to set aside a general assignment made by Thomas F. Kaughran and Edward G. Barrett, composing the firm of Kaughran & Co., on the ground that it was made with intent to hinder, delay, and defraud the creditors of the said firm of Kaughran & Co. The plaintiffs seek to set aside said assignment on various grounds. One of those grounds is sufficient, under well-established principles of law, to warrant the relief asked for, and therefore it is not necessary to consider any circumstance except the one above referred to.
Shortly before making the said assignment one of the said firm gave to his wife, from the assets of the firm, the sum of $3,750, in payment of a debt that he, and not the firm, owed his said wife. This the law regards as a voluntary transfer made to hinder, delay, and defraud the creditors of the firm, and as to them is void. Bulger v. Rosa, 119 N. Y. 465, 24 N. E. Rep. 853, and cases there cited; Durant v. Pierson, 124 N. Y. 449, 26 N. E. Rep. 1095, and cases there cited; Coleman v. Burr, 93 N. Y. 17; Chambers v. Smith, (Sup.) 14 N. Y. Supp. 706. But it is claimed on the part of the defendants that, at the time the said payment was made, the defendant who fnade the payment believed that he had a right to make it, and that, therefore, there was no fraudulent intent. In this respect the case is like Coleman v. Burr, supra, in which case the referee before whom the action was tried found “the whole transaction to be fair and honest;” but, said Judge Earl, the referee “here, however, found facts from which the inference of fraud is inevitable, and, although he has characterized the transactions as honest and fair, that does not make them innocent, nor change their essential character in the eye of the law. Mr. Burr must be deemed to have intended the natural
I have found, as matter of fact, that Mr. ICaughran paid the S3,750 to hie wife “through an honest mistake, and in the belief that he had a right to pay and apply the same in discharge of his indebtedness, which was justly due and owing to his said wife,” but, in view of the above decision, this mistake and belief do not change the legal significance of his act. I do not pass upon the validity of the two confessions of judgment, and the transactions subsequent thereto and connected therewith, because I think the questions of fact arising therefrom can better be determined by a jury in an action to which the judgment creditors are parties. But before plaintiffs can have such determination it is necessary that the assignment should be set aside. Smith v. Payne, (Super. N. Y.) 3 N. Y. Supp. 826. Judgment is ordered for plaintiffs, setting aside the assignment as far as it relates to the individual property of the defendant ICaughran and the property of the firm of ICaughran & Co., with costs. Let a copy of the findings be prepared for signature.