True v. Congdon

| N.H. | Jul 1, 1860

Sargent, J.

’ This verdict must be set aside. The instructions that if the jury believed the intent or the effect of the contract or arrangement between Bailey and True, the plaintiff) was to delay, hinder or defraud the creditors of Bailey, they would be justified in finding for the defendant, were evidently wrong. If the intent of both parties to the assignment was to hinder, delay or defraud Bailey’s creditors, or if such was Bailey’s intent, and that fact was known to True at the time, the assignment would be void as to such creditors. Cadagan v. Kennett, Cowp. 434; Seavey v. Dearborn, 19 N. H. 351; Blodgett v. Webster, 24 N. H. 92 ; Robinson v. Holt, 39 N. H. 557.

But if the assignment was made bond fide and with no such fraudulent intent, it would be entirely immaterial what its effect .might be. The effect of all assignments, at common law or under our statute may be, and perhaps generally is, to delay and hinder the creditors somewhat in the collection of their debts. And this effect might follow from an assignment made legally and bond fide, as often as in any other case, but such effect can have no tendency to make the assignment void as against creditors. The intent of the parties in the transaction was material, and concerning that matter the jury were properly instructed; but in regard to the effect of the contract or arrangement the instructions were erroneous.

The instructions to the jury that the assignment was void, by reason of the conditions in the same on the paid of the trustees, were correct, and the jury might properly have been instructed that it was also void because it did not purport to convey all Bailey’s property for the equal benefit of all his creditors; nor was there any proof that such was the fact; and also because it was not sworn to, as the statute requires. Rev. Stat., ch. 134 ; Comp. Stat. 297; Fellows v. Greenleaf, 43 N. H. 421, and Brown v. Warren, 43 N. H. 430.

The plaintiff’s counsel takes the position that the property sold, or attempted to be, was not sufficiently described, and that therefore nothing passed by the sale. The officer, when inquired of as to what Bailey’s interest in the property was, replied that he did not know. The rule, as laid down by Bell, J., in Jones v. Railroad, 32 N. H. 551, is believed to be reasonable, and clearly deducible from the authorities, and is as follows: “ The principle we think is clear, that the officer who would make a sale of personal property of a debtor, on execution, must have it so far in his possession and control that he can designate and exhibit the articles of property which he proposes to sell, when they are of a visible character. And on similar reasons, when the property does not admit of actual possession, the officer must obtain such knowledge of the state of the property that he may be able to describe to the purchaser precisely and definitely what he offers for sale.” And this rule is stated (on page 553) to be founded on considerations of public policy, and of justice to the debtor, since the effect of any loose practice in this respect must be to destroy all competition at the sale.

Now the officer in this case could show the lumber to those who wished to purchase, point it out particularly, and had it in his control. But he only offered for sale Bailey’s interest in it, and not the whole lumber. True is present and asserts his right to it, claims it all, and forbids the sale. Still the creditor, Rogers, supposing Bailey might have some title, orders the officer to sell his right, without knowing himself or being able to inform the officer what that right was. Now Rogers, the creditor, does not complain of any fraud upon him in the transaction; neither does Bailey, the debtor; and we think, under all the circumstances, that True can not, as he was there and asserted his claim, and gave due notice of his title; and .certainly Congdon can not complain that he was defrauded, for if he chose to purchase a right concerning which he knew nothing, and about which the officer who sold, or the creditor, could give him no information. And after he was notified by True that he owned the whole lumber, of course he had no one to blame but himself, even if his title should prove to be of little worth. Another reason why Time can not complain is, that only Bailey’s interest was sold, which, as we shall see, makes the sale of very little consequence to him.

In this State such a right as Bailey’s may be attached upon a writ of mesne process, whether that right bo that of tenant in common or a reversioner, having an equity after some lien or pledge has been satisfied, though in the latter case the amount of the lien or pledge must first be paid; Rev. Stat., ch. 184, secs. 15, 16 ; Comp. Stat. 471; or the same right might be levied upon and sold on execution, either by paying the amount of the lien, or it may be sold as this was without such payment, when the purchaser acquires only the debtor’s right to the property. Rev. Stat., ch. 194, secs. 4, 6; Comp. Stat. 498. It is said by the plaintiff that there is no such statute provision in the State of Vermont, by which any such equity of redemption or reversionary right in personal property can be taken and sold on execution. This position is not denied- by the defendant’s counsel, and it may be safely assumed that, had such provisions existed in the statutes of that State, the defendant’s counsel, from their location and almost necessary acquaintance with the laws and legal practice of that State, would have called our attention to them. It would seem, from the decision in Smith v. Niles, 20 Vt. 315" court="Vt." date_filed="1848-02-15" href="https://app.midpage.ai/document/smith-v-niles-6573874?utm_source=webapp" opinion_id="6573874">20 Vt. 315, that up to 1848 they had no such statute provision in Vermont as ours, authorizing a sale of an equity of redemption in personal cháttels, or a reversionary interest. If the plaintiff’ is correct in his position in relation to the laws of Vermont, then that would be decisive of the case, provided the jury should find that Bailey’s was a reversionary right only; a right to redeem the lumber by paying True’s lien or pledge upon the same. But if the jury should find that True and Bailey were tenants in common of this lumber1, then, so far as our attention has been called to the laws of Vermont, the sale of Bailey’s interest may be well enough; so that we see the third instructions to the jury, namely, that the sale on the execution, as made, conveyed the entire property to the defendant, were erroneous; for, as we have seen, it may have conveyed nothing. But those instructions were also erroneous in another respect. Rogers, the creditor, testified that he instructed'the officer to sell not the whole lumber, but Bailey’s interest in it. The officer testifies that he-sold only Bailey’s interest in the lumber; and his return, which is the proper evidence of what he did, shows that he sold Bailey’s interest in the lumber only, and not the whole lumber.

Bailey’s interest being all that the defendant bought, that is all he can hold ; so that, if the sale was valid, the instructions that it conveyed all the title in the lumber to the defendant were erroneous, as was - also the ruling to which the plaintiff excepted, by which the evidence was admitted, to show that the contract and course of dealing between the plaintiff and Bailey was fraudulent as to bond fide creditors electing to avoid the same. Assuming that the sale on the execution was legal, Congdon could not have held the rights of Bailey’s creditors, but only the rights of Bailey. It makes no difference, therefore, what Bailey’s creditors might have held if they had chosen to do so, or what questions might have arisen as to the possession or the intermingling of the property, or of fraud as against such creditors. It is enough to say, that whatever the creditors might have done, or whatever they intended to do when the attachments were made, in the eiid they concluded to sell, not what they as creditors could have taken and held, if they had chosen — not the right which, as creditors, they might have acquired by an attachment of the whole, property as Bailey’s, but they simply sold Bailey’s right in the property; and the purchaser of that right stands not in the place of Bailey’s creditors, but in the place of Bailey himself. Congdon, therefore, stands in the place of Bailey, having his rights and his only, and not the rights which Bailey’s creditors might have had to it. This view is clearly sustained in Flanders v. Jones, 30 N. H. 154; in Brewer v. Hyndman, there cited; in Bean v. Brackett, 34 N. H. 122; and in Griffith v. Fowler, 18 Vt. 390" court="Vt." date_filed="1846-07-15" href="https://app.midpage.ai/document/griffith-v-fowler-6573413?utm_source=webapp" opinion_id="6573413">18 Vt. 390. Hence the balance of the second instructions given to the jury, aside from what we have heretofore considered, were either irrelevant or erroneous.

It therefore becomes unimportant to consider the point, whether Bailey’s, admissions, that he did not owe Hall any thing, were admissible in evidence or not. It would make no difference if the judgment in favor of Hall were proved to be fraudulent and collusive, so long as the other judgment in favor of Rogers remains unimpeaehed; because all the dumber appears by the officer’s return to have been sold on both executions, and the sale could not be impeached so long as one of the claims on which it was sold is admitted to be honest, and the judgment properly recovered, by proving that the other was fraudulent. Nor do we see that it would make any great difference with True if both judgments were fraudulent, since the rights acquired under that sale, even if the sale was valid, would only be the right to stand in Bailey’s place, to confirm his contracts, and hold the property just as Bailey held it.

The important question is, what were the relations of True and Bailey -in connection with this property before the sale ? How did they hold this property'as between themselves? For it is not necessary, in this view of the case, to consider what rights Bailey’s creditors might have had, if they had availed themselves of those rights; whether True’s possession was sufficient, as against Bailey’s creditors, or whether he had so intermingled his property with that of Bailey, that such creditors could hold the whole of it as Bailey’s; or whethei’, by the contracts between them, True acquired any.such lien upon the property as would be valid as against such creditors. The only question is, how did they stand as between themselves, and how was the property held as between them, leaving every body else out of the account?

The evidence tends to show that after the assignment from Bailey t© True, many lots of lumber were bought by True, or by Bailey for him, which were paid for by True, or were bought upon his credit, and that all this lumber went in with Bailey’s, or with that which had at first- been assigned to True, and that the same was all kept and manufactured together. And it seems that the ground taken at the trial was, that these lots of lumber, thus bought, were True’s, and that, as the assignment was void, and True could hold nothing under it, that property all remained Bailey’s, just as though no assignment had been made; and that True had suffered his lumber, thus purchased and paid for by him, to be so intermingled with Bailey’s, which he had attempted to assign to True, but failed in the attempt, that the same could all be held-as Bailey’s lumber, by his creditors. " '

Now, supposing these to bo the facts, still, as between True and Bailey, they would be tenants in common of the lumber, each owning a distinct proportion, to be ascertained by and between themselves. If the jury should find that True and Bailey -were tenants in common — and the defendant claims in his argument that they were so — then by the sale, if it was valid, Congdon, acquiring Bailey’s interest, became a tenant in common with True, and the question to be .settled would be, whether Congdon had so used or conducted with this lumber as to make himself liable in this action, to his co-tenant? and if so, to -find the amount, or proportion of lumber owned by True, for which he would be entitled to damages.

But if it should be held- as a matter of law, or found as a matter of fact, on a new trial, that the sale was not legal, and passed no property, then, if True and Bailey were tenants in common before, they would of course remain tenants in .common still, and still own the property as before, and they might sue Congdon for taking away this lumber. But as this is an action in form ex delicto, the defendant can not take advantage of the non-joinder of Bailey as plaintiff, except by plea in abatement, which he has not done, and which it is now too late to do. Bor although the fact is otherwise in actions in form ex contractu; 1 Ch. Pl. 13; Pitkin v. Roby, 43 N. H. 138; yet, “in actions in form ex delicto, and which are not for the breach of a contract, if a party who ought to join be omitted, the objection can only be taken by plea in abatement, or by way of apportionment of the damages on the trial; and the defendant can not, as in actions in form ex contractu, give in evidence the nonjoinder as a ground of nonsuit under the plea of the general issue; or demur; or move in arrest of j udgment; or support a writ of error; although it appear, upon the face of the declaration, or other pleading of the plaintiff, that there is another party who ought to have joined.” 1 Ch. Pl. 66 ; Cabell v. Vaughan, 1 Saund. 291, f, g and h; Child v. Sands, Salk. 32; Brown v. Hedges, Salk. 290; Addison v. Oberend, 6 T. R. 766; Wilbraham v. Snow, 2 Saund. 47, g; Thompson v. Haskins, 11 Mass. 419" court="Mass." date_filed="1814-10-15" href="https://app.midpage.ai/document/thompson-v-hoskins-6404227?utm_source=webapp" opinion_id="6404227">11 Mass. 419; Bradish v. Shenk, 8 Johns. 151" court="N.Y. Sup. Ct." date_filed="1811-05-15" href="https://app.midpage.ai/document/bradish-v-schenck-5472843?utm_source=webapp" opinion_id="5472843">8 Johns. 151; Wilson v. Gamble, 9 N. H. 74. This rule holds true of all actions of tort brought by one only of two or more joint tenants, parceners, tenants in common, partners, executors, assignees in bankruptcy, and others who regularly ought to join as plaintiffs'. Cabell v. Vaughan, supra, and cases cited.

But if True, although he could not hold for creditors under the assignment, it being void, might hold such property as actually came into his possession under the assignment, so long as he retained such possession, as security for his own debt and expenses, byway of pledge, and after he had taken actual possession of all the lumber and timber about the mill, and marked someof it, the arrangement between him and Bailey was, that Bailey should act merely as his servant and agent, and hold the lumber as such, for True; so that, as between themselves, his possession was True’s possession ; then Bailey’s interest in that lumber would only be a reversionary interest; a right to have whatever might remain after True’s lien was extinguished ; and then True could, in the first instance, if the sale was void, recover for the whole lumber assigned, together with all which he had himself added afterward.

If a jury should find that such were the facts, or that, by the contract of the last of March or first of April, 1855, between Bailey and True and the Danforths, all the lumber originally assigned, which had come into True’s hands, or into Bailey’s as his servant, and all that had subsequently been put in by True or Bailey, and all that should be put in, should, and did by force of that contract and agreement, as between him and Bailey, become True’s property, and Bailey became his servant, to keep possession and take charge of and manufacture the same for True, and that True was thus in the legal possession and control of the lumber, with a lien upon it for all his debts and liabilities, and for all his expenses and advancements on account of the same; then, Bailey, having only a reversionary interest, True could recover for the whole lumber taken by the defendant, and, after deducting all his claims, he would hold the residue for Bailey. It would seem from the evidence, as reported on the trial, that a jury might well find the latter to be the true position of the property, and of the parties, True and Bailey, as between themselves.

So, then, if it should be found upon another trial that the defendant took nothing by his purchase, the only question would be as to the amount of damages the plaintiff should recover. Because, if the jury should find that True and Bailey were tenants in common, then they remain so still, if nothing passed by the sale; and though they should properly have both joined in this action of trespass, yet the non-joinder of Bailey as plaintiff not having been pleaded in abatement, can not now be taken advantage of in any other way than by an apportionment of the damages, on trial. But if the jury should find that, as between Bailey and True, the latter had a lien upon this property, and the legal possession, and Bailey only a reversionary interest, then, if nothing passed by the sale, the plaintiff may recover the full value of all this lumber, of this defendant, and he and Bailey will adjust their matters afterward.

But should it be found on a new trial that the sale of the lumber was valid, so that Congdon, having Bailey’s interest, stands in his place, then, in case it be found that Bailey and True were tenants in common, Congdon, by this purchase, would become a tenant in common with True; and then the question would be, whether Congdon had so used or conducted with this lumber as to make himself liable in this action to his co-tenant ? But if it be found that True had a lien upon all this lumber, as against Bailey, and Bailey only a reversionary interest — his possession being as the agent and servant of True — then Congdon stands in the same position, and when he took the property as his own, and appropriated it all to himself, he made himself liable to True for the whole amount of the property, in the first instance, as damages, if the whole would be necessary to meet True’s claims; -but if not, then, as Congdon has the same reversionary interest that Bailey had, to avoid circuity of action, True would only recover the amount of such claims as were covered by his lien upon the property.

New trial granted.