delivered the opinion of the Court.
This is. аn appeal from the Circuit Court of thé United - States, for the district of Kentucky.
The bill filed in the Court below, was for the purpose of setting aside af certain, deed of assignment, made and executed' by the defendant, Wheeler, for the purpose of securing to certain enumerated creditors the avails of his property; to' the exclusion of the cоmplainant; and that the complainant may be decreed to have satisfaction of his judgments set- out in' the bill, out of the property conveyed by the deed.
The bill sets out, that at the November term of the Circuit Court of the United States, in Kentucky, in the year 1837, the complainant recovered two judgments against Leonard Wheeler; ■one-for the sum Of four thohsand dоllars, with interest, from the 21st of February, 1814; and the other Tor eight-hundred and ninety-one dollars and fifty-three cents, with intereát for the same time; upon which judgments executions were not to issue until the 1st of February, 1838: at which time executions were duly issued, and put into the hands of the marshal of the district to be executed; upon which the marshal'returned, that he. found no property of whiсh to make the money on the executions.
The bill further states, that on the 27th of January, 1838, the said Leonard Wheeler, by deed of trust or assignment, made a ■ conveyance to certain of his preferred and specified creditors (of *114 which the complainant was not' one) of certain property therein specified,'to pay and discharge сertain specified debts, which'deed was duly acknowledged and recorded in the proper county; and the bill charges, generally, that this deed is fraudulent and void. It particularly charges, that the deed was made without the •knowledge, privity, or assent of the creditors named therein, and who áre the parties to whom the deed • is- given. That the deed was never dеlivered to, nor accepted by the grantees. That it was made with intent to deceive and defraud his- just creditors, who were not' included in its provisions. That the possession of the property, conveyed by said- deed, was retained by the said Wheeler, and never delivered to the parties of the second part, or any one of them. That the deed was lodged in the clerk’s office for record after the rendition of the complainant’s judgments, and but a short time before he was authorized to issue execution upon his judgments.
■ It further charges that the sale of the goods to Joseph Putnam, one of the creditors named in- the deed of trust, was fraudulent, and without any valuable consideration; and that the business was аfterwards cohducted in the name of the said Putnam, but •for the use in whole or in part of.the said Wheeler.
■ It further .chárgés that Joáeph Swift, another 'defendant, has for several years past been employed' in carrying on the grocery business, in which the said Wheeler was interested; and that the said Swift is nOW in possession of goods, or money, or other property, belonging tо the said Wheeler, or is indebted to him for the same.
It also charges that Norman Porter," another of the preferred creditors, had money in his hands belonging to the said Wheeler, and to be used for. his benefit; and that the note mentioned in the said deed of three thousand one hundred and seventy dollars, was purchased by said Porter for Wheeler’s benefit, and with his monеy.
• The bill likewise prays, that' Abei Wheeler, one of the preferred creditors, m^,y answer and state particularly, whether he has at any time lent and advanced to Wheeler money or other property, and whether he now holds any note, or memorandum, or other evidence of debt against him.
■The bill prays that the said Leonard Wheeler, and the above *115 mentioned preferred creditors, may answer specially and particularly to the several interrogatories' put in the bill, in reference to the transactions between them severally and respectively.
The several answers of Leonard Wheeler, Porter, Putnam, Swift, and Abel Wheeler, contain a full and explicit denial of all the charges contained in the bill, tending in the least manner to -sustain the allegations of fraud or collusion, or any secret or unfair transactions between them,- or either of them, with Leonárd Wheeler. And there is no proof offered to sustain these allegations ; they may therefore be dismissed as wholly unsupported.
The bill ■ calls upon the 'said Leonard Wheeler to statе how and to whom he -delivered the deed of trust; in answer to which he states, that every creditor provided for by the deed, was a’ real and bopá. fide creditor. That he consulted with a number of his creditors,"naming them, before making the deed';, all of whom approved'of it; and that he knows of none .who disapproved of it, or rejected the benefit of. its, рrovisions; and some of them have accepted of it ip writing, which appears by the exhibits annexed to the answer. ■ That, being satisfied with the propriety of the measure, .he made and executed the deed, and left it in the proper office, to be recorded for the use of his creditors. He admits that the funds, mentioned in the deed of trust, remained in his -pоssession; and that the creditors have never availed themselves of the privilege-of .appointing-a trustee; having confidence, as he presumes, in fhe correctness of his management' of the business. And he further states, that he has gone bn. in collecting the choses ip.action, and payingpvér the proceeds to the creditors, according to the provisions of the deed of trust.
The answer of -Wheeler with respect .to the delivery Of the deed, and the possession and.'mánagement of the funds, is corroborated by the answers of a number of the creditors, who are made parties, and called upon to answer on these points. -They say, that they were Consulted before the deed was executed, and approved of it then; and accepted it when made. That no trusteé has been appointed, because they had full confidence in Wheeler, and desired him to continue in-the-management of the business.
There are several amended bills, with the answers ’ thereto, *116 bringing up some new matters, but riot, of sufficient importance .to require any sрecial notice. The above Statement of the bill and answers presents all the material questions which arise'upon the merits of this case.
It is deemed unnecessary-to'notice the objections made to thé jurisdictioruof the Court below, either on the ground that Elisha I. Winter, the real party in - interest,-should, have been made the party complainant in this suit; оr that there'is a want of proper parties, defendants, to enable the Court to make a.decree upon the merits. The conclusion to "which we have- arrived supersedes the necessity of considering these questions.
Although the right and power, of ¿-debtor , to give a' preference to some of his boriá.ñde creditors, to the exclusion of others, has not been denied on the part of the 'complainant'; yét, it haá been urged, in argument, that such-preferred creditors are no favourites in a Court of Chancery, where it is said equality is.eqúity; and that a Court of Chancery will look narrowly into, állthe circumstances, arid if it is forind that- the deed is tainted in the smallest degree with fraud, it will be declared void.. ■ And it has been insisted, that in the present сase there • are strong Circumstances to show that in-making this deed of trust, the defendant Wheeler did not act iri gbod faith towards the complainant. That he obtained from him an .agreement to postpone! issuing executions upon his judgments until after the first of February; and that á few days ' before that time he made the assignment in’question,'So as to put all .his property out оf the reach of trie executions-5 and that this was in. bad faith, which ought riot to'receive'trié Sanction of a Court of Equity. It may he observed, iri the first place; that there is no evidence of any-deception practised by Wheeler, lb lull’ him to ■ sleep, or procuré' any delay, in issuing executions on the judgments. It was done in the ordinary course Of judicial proceеdings. And-if the principle he sound; that a débtor^may lawfully- apply his property to thé; payment of the debts of such creditors as he may erioose to prefer, hé may certainly elect the time, when it is to bé done, so- as to .make it effectual. And’ such preference must necessarily-operate to the prejudice of creditors-' not provided for; аnd cannot' furnish' any evidence, óf a- fraudulent intention. But the circumstances of the present, case are suph as, not ' only to remove all' ground for any charge of fraud, *117 but even .of injustice or unfairness in. the. conduct of Wheeler Although it . may be admitted ■ that John. Tompkihs is properly m.ade complainant, yet it is manifest from, the record that he is a mere nominal party, and that Elisha I. Winter is the real party in interest. This is shown by the answer of Wheeler* and proved by the testimony of William Fellows; who swears that in the latter part of 1836, or the beginning of 1837, Winter, through his agent, applied to him, to purcháse the claim of Tompkins,, which had been sent tp him for collection. That he' offered one thousand dollars for it, which was not at that time accépted. That in the summer of 1837; Winter himself made the same offer which his agent had made; and again, in the fall of 183.7, he renewed the offer of one thousand dollars, and expressed his opinion of Wheeler’s condition, when, with the opinion of some others, who .he supposed. knew Wheeler’s circumstances, he in the month of October, 1837, sold the claim tо Winter for one thousand dollars; believing that he was^purchasing it for the benefit of Wheeler. That, a few days after the sale, he received a written request from Winter not to" let it be known that he had the control over the claim.'. Thus we see great anxiety in Winter’ to purchase a claim against a man embarrassed and in failing ' circumstances; and the cоnsideration paid for it shows that the claim .must have been considered almost desperate. Only one thousand dollars given for a claim which, by the judgments stated in the complainant’s bill, including interest, amounted to between eleven and twelve thousand dollars. " These circumstances, independent- of the statements in Wheeler’s answer, are calculated td cast some suspicion upon the conduct of Winter, and to justify tire inquiry, whether, he comes into Court with clean hands, and can justly reproach Wheeler with bad faith and unfairness towards him. Wheeler’s circumstances were extremely embarrassed, if not desperate, and he found impending over him two judgments amounting to nearly twelve thousand dollars, in the hands and under thе control of Winter; who he had certainly no reason to believe was friendly to him; and which judgments, if they could have been- enforced to their full amount, would have swallowed up a great proportion of his property. Was he not, under such circumstances, authorized, by every principle of justice and honesty, to • secure as far forth as he could his bona *118 fide creditors ? That- the debts of all the creditors preferred in the,. deed of trust, are bona fide debts, is fully established; not only, by-the proofs,-but is admitted on the record, by an agreement whiph, among other things, states, “that the genuineness of the debts provided, for in Wheeler’s assignment will not. be contestéd 'or' called in. question on the argument.?’
That a-, debtor has"a lеgal right .to prefer one. or more.of his creditors over others,'when the transaction is boná fide, is hot an open question in this Court. That point was settled in the- case of Marbury v. Brooks, which came twice before the Court under ■circumstances somewhat different, and is reported in.
But several objections-have, been taken to the legal effect and operation of this.deed, on other grounds than that of fraud.
That it was made by Wheeler without the knowledge оr consent of the creditors therein, named.- That it.was never delivered to or accepted by the creditors. That possession of the fund was .retained by Wheeler, and no trustee appointed áccórding- tó the provisions of .'the deed.
. Some of these objections are npt founded in fact. -It is true that it does not áppear that' all the creditors had any knowledge of. the deed before it was executed. '-But if does-áppear fromthe answer of a number of the creditors named in- the deéd,- that they were .advised' of the necessity of Wheeler’s securing them, and informed of his intention to secure them before the deed was executed, apd approved of it; and accepted the benefits of its provisions'; and since that time hpve been paid their debts, in full. And there is no evidence that' any one ■ dissented. F. S. Fuller says, he was never consulted' with about making the deed, or informed of it before its execution; and that he has never-accepted of its provisions. But he does not say that he has. ever refused to accept of the provisions in his fаvour; and he may not therefore have precluded himself, from still accepting. This deed is absolute upon its face, without any condition whatever attached to it; and being for the benefit pf' the grantees., the presumption
*119
of law is, in the absence of all evidence to the contrary, that the. grantees accepted the deed. In the cáse of Marbury
v.
Brooks, it is said - by the Court, that an assignment for the benefit/of preferred creditors is valid, although their assent is not given at the time .of it„s execution; if they subsequently accept in terms, or by ; actually receiving the benefit of it: Deeds of trust, say. the Court,
If the fund had. remained in the possession .of Wheeler for his own benefit, it might have cast a suspicion upon the fairness of the transactiоn; but there is no proof.of any such object or design, or. of any fact from which an inference of mala tides can be -drawn: but on the contrary, the object of his continuing in the possession o^ the property is satisfactorily accounted for by the *120 circumstances of the case. It consisted principally, of unsettled accounts,, and choses in action, which he was much more competent to settle than a stranger could have been. It was, therefore, for the benefit of the creditors that he continued to settle up these accounts and pay over the money to his creditors, as the proofs show that he did. This wai by the express consent of some of the-creditorá, and the presumed consent oi all, as no dissent,or complaint.appears to have been made by any; and no one had any right to complain but the parties who were to receive the benefit of the assignment. This possession wá's held ,at the will and pleasure of the creditors, which they could have withdrawn at any time, if dissatisfied with the management of Wheeler; and this was a substantial compliance with that part of the assignment which relates to'the appointment of an agent, or trustee, for the purpose of executing and fulfilling the trusts and purposes of the assignment. The creditors were, of course, to be the judges of the .fitness and competency of such agent, or trustee; and they were the only parties interested in the faithful discharge of his duties. No formal appointment was necessary; an express or implied assent of the creditors to Wheeler’s acting as agent, or trustee, was all that could be reopfired, according to the fair interpretation of the assignment
We are, accordingly,, of opinion, that the decree of the Circuit Court, dismissing the bill without prejudice, be affirmed.
Decree affirmed.