244 Mass. 221 | Mass. | 1923
Before November 4, 1920, the assets of the principal defendant were sold, and the proceeds thereof, amounting to $1,946.58, were paid over to the alleged trustee who agreed to hold and distribute the same pro rata among such creditors of the defendant as should “desire to accept said pro rata payment in full settlement of their respective accounts, with the agreement, however, that not any more than the pro rata payment should be made to any creditor.”
On November 4, 1920, the alleged trustee by letter addressed to each of the creditors of the defendant stated that he represented the largest creditor; that he had been consulted by the defendant’s treasurer; that its assets had been sold, and that after paying certain claims there remained the above named sum which was deposited with him for the purpose of distributing it pro rata among the several creditors; that the amount of the defendant’s debts was approximately $9,000 and that a final dividend of
The foregoing facts appear in the answers of the alleged trustee made in response to interrogatories propounded to him. These answers disclose that the trustee holds the fund in trust for the purpose of distribution in accordance with the terms of the agreement; and that, as to the creditors who have assented to-the agreement, he holds it in their behalf upon a legal consideration, and is bound, unless fraudulent, which does not appear, to distribute it pro rata in settlement of their respective claims. Andrews v. Ludlow, 5 Pick. 28. National Mechanics’ & Traders’ Bank of Portsmouth v. Eagle Sugar Refinery, 109 Mass. 38. Frazee v. Nelson, 179 Mass. 456, 460. In the case last cited it was held that a conveyance of property by an insolvent debtor in trust for assenting creditors cannot be ¿voided, except for fraud at the suit of a creditor who does not assent. Train v. Kendall, 137 Mass. 366. Sawyer v. Levy, 162 Mass. 190. Creditors, the amount of whose claims largely exceeds the fund in the hands of the alleged trustee, have agreed to accept the pro rata payment in settlement of their respective claims, thereby signifying their adoption of the transfer of the fund to the trustee for their benefit. The trustee by such acceptance became obligated to carry out the terms of the agreement. May v. Wannemacher, 111 Mass. 202. Pierce v. O’Brien, 129 Mass. 314. The law governing assignments similar to that in the case at bar made by an insolvent debtor for the benefit of creditors has long been settled. In May v. Wannemacher, supra, it was said that “it has always been held that voluntary assignments by a debtor, in trust for the payment of debts, and without other adequate consideration, are invalid as against attachment, except so far as assented to by the creditors for whose benefit they were made. If assented to by creditors, such assignments are good at common law, and will protect the property or fund from attachment to the extent of the amount due to creditors thus assenting; unless,
In all the cases cited by the plaintiff no creditors had become parties to the assignment, or assented to it, or released their claims in consideration of it; accordingly those cases are not applicable to the facts in the case at bar. Wyles v. Beals, 1 Gray, 233, and Edwards v. Mitchell, 1 Gray, 239, cited by the plaintiff, are not pertinent to the present case. See Gen. Sts. c. 118. National Mechanics’ & Traders’ Bank of Portsmouth v. Eagle Sugar Refinery, supra.
Order affirmed to effect that earlier order charging trustee he vacated.
