97 Tenn. 351 | Tenn. | 1896
This is a general creditors’ bill, filed in the Chancery Court of Hamilton County
The second deed of trust, executed at the same time, was made to the said Prosper Lazard, as trustee, and secures the same indebtedness embraced in the Gottsehalk deed, and also other debts amounting to $4,900, among which are included the debts of complainant. The last deed embraced the material on hand, as well as the notes and accounts receivable. It is stated in this last deed that it is intended, as to the debts secured by the Gottsehalk deed, ‘ ‘ to secure any balance that may be owing-on said debts to Prosper Lazard, or on which he is indorser or security, after the exhaustion of the property included in said trust deed to Gottsehalk.”
The bill charges and the record shows that this
The total value of all the assets of the Bradt Printing Co. at the time these trust deeds were made was about $10,023.08, while its total indebtedness, set out in the two deeds, amounts to $19,-627.03. The Bradt Printing Co. was therefore an insolvent corporation when the two deeds of trust were executed. The trust deed to Gottschalk provides, viz.: “The trustee, James Gottschalk, is authorized, directed, and empowered to take immediate possession of the property herein conveyed, and unless the indebtedness hereby secured is paid by the Bradt Printing Co. within six months from this date, the trustee will sell the machinery, fixtures; etc., at public auction, to the highest bidder, for cash, and the proceeds will be applied,” etc. The other trust deed to Lazard contains the following provision, to wit: “The trustee is authorized, directed, and empowered to take immediate charge and possession of the property included in the deed of trust, and will collect the accounts as expeditiously as possible, and the merchandise and stock on hand he will sell, either at public or private sale, within the next six months, either for cash or on short time,” etc.
The Court of Chancery Appeals found that ‘1 the
The Court of Chancery Appeals was of opinion that the facts so ascertained by them brought this
This Court expressly held, in Tradesman's Publishing Co. v. Knoxville Car Wheel Co., that, the insolvency of a corporation at the time of making such a conveyance does not, without more, vitiate the. deed. We expressly said in that case that “we do not decide, and do not wish to be so understood, that a corporation, although actually insolvent, so long as it is a going concern, may not deal with its property and transfer it for value, in due course of business, to general creditors. A mere excess of liabilities over assets would not alone be sufficient to justify an interference and stoppage of
We fully concur with the Court of Chancery Appeals in their legal conclusion that the facts so ascertained by them brings this case within the principles settled in Tradesman's Publishing Co. v. Knoxville Car Wheel Co. (11 Pickle, 634).
The decree is therefore affirmed.