91 Wis. 29 | Wis. | 1895
A careful study of this case fails to disclose any reversible error, unless the court erred in failing to find that the mortgages given by the defendant, Imig, together with the verbal agreement made between the parties at the time, in connection with circumstances then existing, constitute an assignment for the benefit of creditors, within the authority of Winner v. Hoyt, 66 Wis. 227; Maxwell v. Simonton, 81 Wis. 635; Fuller & Fuller Co. v. McHenry, 83 Wis. 573; and Northern Nat. Bank v. Weed, 86 Wis. 212.
The statement of facts preceding this opinion presents a case where an insolvent debtor, wishing to prefer fourteen of his creditors, who were relatives and friends, gave them a chattel mortgage covering all his property, coupled with an agreement, made at the time, that one of such creditors should immediately take possession of such property, as agent and trustee for all, and administer the trust in accordance with the mortgage and such agreement. Subsequently two other creditors took chattel mortgages on the same property, with full knowledge of all the facts in regard to-the first mortgage, and became parties to the arrangement first made, substantially the same as if they had been named in the first mortgage, to be paid — Zschetzsche after the fourteen creditors, and Sticlcney last. All the parties, from first
From the foregoing, it is needless to say that we think the learned trial judge erred in not finding, as requested by the appellants, that at the time of the making and execution of the first mortgage it was agreed by all the parties interested in the transaction that one of the mortgagees should take immediate possession of the mortgaged property, in trust for all the mortgagees, and sell the same and distribute the proceeds, after paying the expenses, among the creditors named in the first mortgage, pro rata, until all were paid in full, and that the mortgagees Zschetzsche and Stickney subsequently became parties to such agreement. In Winner v. Hoyt it was distinctly held that chattel mortgages and assignments of accounts, transferring the entire property of an insolvent debtor to certain of his creditors, with intent that one of such creditors, for himself andas agent for the others, should take possession and convert such property into money and divide the same pro rata among such favored creditors, are in effect general assignments for the benefit of creditors, with preferences, and void as to the. other creditors. This rule has stood the test of repeated reviews, and is so intrenched in the jurisprudence of this state ■that it is not liable to be modified; and whenever a case is presented coming squarely within such rule there will be no hesitation in applying it, to prevent the statutes of this state on the subject of voluntary assignments for the benefit of creditors, and against preferences, from being violated.
Counsel for respondents cite several cases decided in this court to show that this case is not within the rule stated, hut a brief examination of them will show plainly that they differ from Winner v. Hoyt and this case as well, in several material particulars. In Gribb v. Hibbard, S., B. & Co. 77
In Cribb v. Hibbard, S., B. & Co. 77 Wis. 208, Ingram v. Osborn, 70 Wis. 18.4, and other cases in this court, it is laid down that the test, in order to determine the question of whether a transaction amounts to an assignment for the benefit of creditors, is that: “There must be a trustee, creditors, and cestui gue trust who can compel an enforcement of the trust, in order to constitute such an assignment;” but “it is not essential that a trustee should be named as such in the instrument” (Cribb v. Hibbard, S., B. & Co. supra), or be specifically named at all at the time of
The chattel mortgages should have been held void, and the garnishee defendants, held liable.
By the Gowrt.— The judgment of the circuit court is reversed, and the cause remanded with directions to render judgment in favor of the plaintiffs in accordance with this opinion.