Vanbuskirk v. Warren

34 Barb. 457 | N.Y. Sup. Ct. | 1860

Lead Opinion

Weight, J.

I concur in the opinion that the questions, whether there was a valid sale or transfer of the safes to the plaintiffs, and whether title had passed to the latter before the defendants’ attachments issued, are to be determined by the law of New York, and not of Illinois. The parties arc residents and citizens of this state. ■ Bates, the assignor, resided here. The instrument, by virtue of which the plaintiffs claim, and which the defendants, as Bates’ creditors, seek to invalidate, was executed here. So, also, the debts which constituted the consideration for the transfer, as well as those upon which the attachments issued, were contracted in Hew York. The legal controversy is pending in the courts of this state. Indeed, the property in controversy was manufactured here, though happening to be in the hands of Bates’ agent, in Illinois, at the precise period of the attempted transfer. Under these circumstances, if it should be conceded that the law of Illinois differs from ours, the validity of the transfer is to be tested and determined by the law of this state. The law of the owner’s domicil determines the validity of every transfer, alienation or disposition made of personal property by the owner; and the nature and construction of personal contracts is to be controlled by the lex loci contractus. This is the general rule ex comitati ; but a particular state may, by its statute or customary law, make special provisions in respect to personal property actually within its territory, in favor of its own citizens, as it has entire dominion over it while therein, in point of sovereignty or jurisdiction. A voluntary transfer of personal property, which is valid by the law of the owner’s domicil, is valid every where, except the law of the particular sovereignty in which it is situated has abrogated, or is in contravention, in special cases, of the general rule of the public law. It is not to be assumed, in the absence of evidence, that the lex domicilii does not govern in Illinois in the case of a voluntary transfer and disposition of personal property by the owner, as well as in this state; nor that if this case were pending in that state, the nature, validity and construction of Bates’ assignment would not be determined by the law of Hew York. The remedy to be pursued in invitum as against personal property, is controlled by the state in which such property actually is; but because a citizen of a foreign state may elect to pursue such remedy against the property of another foreign citizen temporarily within the jurisdiction of a particular state, it does not follow that a controversy respecting the title of such property is to he determined by the law of the latter state. Were the controversy pending in the latter state, this would be assuming that the lex domicilii did not govern them. This litigation, however, which involves simply the question whether property in the safes had passed to the plaintiffs before they were attached for the debt of Bates, is pending here, and, I think, is to be determined by our law.

Now, by the law of this state, was there á valid sale and transfer of the projierty to.the plaintiffs prior to the issuing of the attachments; for if there was, the defendants were not justified in attaching it for the debt of Bates. On the argument, I supposed this to be the principal, and the gravest question in the case. Upon a careful examination, however, I have become satisfied that the transfer was valid, and that Bates, by the instrument executed on the 2d November, 1857, effectually divested himself of all title to the property itself. He manifestly intended to transfer the property directly, to the plaintiffs, his creditors, by way of security. No trust was designed; the legal effect of the provisions of the assignment was not to create any; and the legal title passed immediately and absolutely to the plaintiffs. Bates never could have invalidated the sale and reclaimed the property, on the ground of fraud, or that delivery of possession of the subject matter of the assignment, which was at a distance, did not accompany a delivery of the instrument itself But the court below found that there was no fraud in fact; there is none in law arising from the provisions of the instrument, and no proper parties to raise the question if there had been any; and immediate delivery was not indispensable to consummate a change of title. There may be a valid sale of personal property, and the title will pass to the vendee, though unaccompanied by immediate delivery. Our statute makes an assignment of chattels unaccompanied by an immediate, delivery presumptively fraudulent as against the creditprs; that is, the judgment'creditors of the person mating such assignment, or subsequent purchasers in good faith; but even as respects these classes of persons, (and they are the only ones that can raise the question of fraud,) it is not required that delivery should accompany the written instrument of transfer, to pass the title to the thing transferred. The fact that the assigned property was not delivered simultaneously with the instrument, does not prevent a change of ownership; but only casts suspicion upon the fairness and good faith of the transaction, and, as against the creditors of the assignors, or subsequent purchasers without notice of the assignment, throwing the onus upon the assignee to show that the assignment was made in good faith, and without any fraudulent intent. If the assignment in this case was valid, and passed the title to the safes, as. against Bates, it was equally so against the defendants, who were only creditors at large, and not in a position to attack such assignment as fraudulent. They had not proceeded to judgment and execution, and thereby placed themselves in a position that the assignment interfered with the assertion of their right to the property in question; and until this was done, they were equally bound by Bates’ acts, as Bates was himself. The act of" attaching, as creditors at large, the assigned property, did not put them upon the footing of bona fide purchasers for value without notice, so as to enable them to call in question the validity of the act of Bates in disposing of such property. Were this otherwise, however, there is no provision of the assignment having the effect to hinder, delay or defraud Bates’ creditors. It is true, that the effect is to give a preference to certain of his creditors, which he had the right to do; but if the transaction is to be regarded as clothing the plaintiffs with a trust, there is no provision of the instrument operating as a restraint upon the discretion of the trustees, or any conditions imposed which would hinder or delay Bates’ creditors in reaching any surplus that might remain after the satisfaction of the plaintiffs’ demand. With regard to the provisions as to the mode of selling, and the price to be obtained for the assigned property, I entirely concur in the view taken, and the construction placed on them, by the learned judge at the circuit.

If the title to the property had been changed, it could not be legally attached for a debt due from Bates. It was no more lawful, in Illinois, to attach A.’s property for the debt of B., than it would have been in Hew York. It is supposed, however, that because the plaintiffs had notice of the attachment suits, and permitted them to go to judgment undefended, they are in some way concluded or estopped, by such judgment, from contesting in the courts of this state the title to the property. This cannot be so. The plaintiffs were not bound to interpose their claim of title in the suits in Illinois, or be barred. They were not parties, or, in any legal sense, privies to that litigation. Because the defendants had chosen to attach their property for the debt of another, and they were casually notified of the illegal act, and suffered the proceeding to go undefended, they are not consequently concluded by the judgment subsequently obtained. The defendants were wrongdoers in issuing and levying the attachment, and the subsequent acts of taking judgment and selling the property, were but further illegal steps. In pursuing their remedy against the property they could only acquire and sell, by force of their judgment, the title and interest of Bates, if he had any. If they wrongfully attached the property of strangers, though those strangers may have been casually informed of the proceeding and did not come in and defend, or demand a delivery of the property and bring suit, I am unable to perceive how a judgment against Bates, or in rem as against the property of Bates, can estop the real owners of the property from asserting their title in an action against the wrongdoers.

I think that the action was well tried, at the circuit, and that the judgment is right. I vote for an affirmance of the judgment.

Hogeboom, J.

(After stating the facts.) Under these circumstances the question arose, which party was entitled to prevail; in other words, which party was to be regarded, in this state and in these actions, as having the better title to the iron safes. My brother Gould is of opinion that the judgment of the circuit court was erroneous and should be reversed, for the reason that the defendants are protected by the judgment which they have obtained in the attachment suits against Bates in Illinois; that inasmuch as the attachment suits in Illinois were not defended, nor any stay of proceedings obtained therein, nor these suits brought to bar the attaching creditors’ title in Illinois, but the attaching creditors were allowed to proceed to judgment and execution, in Illinois, before these suits were instituted, the, plaintiffs’ remedy, if any they had, was lost; that the defendants have been allowed to perfect title to the property in Illinois; that full effect must be given to the judgment of that state, and damages cannot be awarded in the courts of this state against the defendants for asserting, in Illinois, their rights under a judgment of the courts of that state, valid when rendered and valid by relation, and of force from the time of the attachment levied ; that if the plaintiffs had desired to contest the rights of the attaching creditors to the property in dispute, they should have come in and defended in the attachment suit, or should have seasonably demanded the property, and if not delivered, brought suit for it prior to the entry of judgment in the attachment suit; and that the plaintiffs, by failing to act on the notice which they had of the attachment, in Illinois, and by allowing the attachment suit there to proceed to judgment without interposing there any claim of title, have put themselves in a position where they cannot contest the question; that by force of the Illinois judgment the property has been sold as the property o(f Bates, and at the time of the first demand, in New York, of the property in question, by the plaintiffs, of the defendants, the property was in the custody of the law in the state of Illinois, and the proper person of whom to make the demand was the sheriff of Cook county, Illinois, who must he sued in Illinois, and who is not sued here; and that for these reasons the defendants must prevail.

In these views I cannot concur. I cannot perceive any such conclusiveness in the Illinois judgment, as against these plaintiffs, as is claimed for it. The proceedings are between different parties. The plaintiffs in this case are in no proper sense either parties or privies to those proceedings, and therefore are not bound by them. The attachment suit and proceedings must have been between the present defendants, as plaintiffs, and John W. Bates, or some one holding under him, as defendant. The present plaintiffs were strangers to them. Nor do I see that the fact that they became cognizant of those proceedings after the levy of the attachment, and before the judgment, can in any manner affect them. They had no right—at least they would have no right in this state —to intervene in those proceedings. My learned brother supposes that in Illinois the assignees would have had a right to come in ami defend the attachment suits. I do not know how this is; but it would be necessary to go at least one step farther before those proceedings could assume the character of an estoppel; to wit, that the assignees should _ be hound to come in or be barred. In such event, it is possible that the judgment would be conclusive upon the present plaintiffs as being one to which they were in effect either parties or privies. But I know of no such law or adjudication in Illinois, and it has not been contended for by counsel" in this case.

The Massachusetts cases of Whipple v. Thayer, (16 Pick. 25,) Daniels v. Willard, (Id. 36,) and Burlock v. Taylor, (Id. 335,) all hold that an assignment made by an insolvent, in ^nother state, valid by the laws of that state, is valid in Massachusetts, so far as to protect personal property situated in Massachusetts at the time of making it, against an attachment in Massachusetts made by a citizen of the state where. the assignment was made. It is true the question was tested by a suit brought in Massachusetts by the assignees, against the attaching creditor, or the officer levying the attachment, previous to judgment in the attachment suit. But I cannot see how the position or rights of the assignees would have been prejudiced by waiting until after a sale upon execution, under the judgment in the attachment suit. Taking judgment, issuing execution and making sale thereupon, would only have been additional illegal steps to the primary one of issuing and levying the attachment upon property not subject to it.

The Massachusetts decisions do not, therefore, as has been supposed, favor the views contended for on behalf of the defendants. On the contrary, if they prevailed in Illinois they would be decisive to show that if the present plaintiffs had brought this action there, they, as citizens of Hew York, showing title to property in Illinois valid by the laws of Hew York, where the assignment was made, as against the defendants, citizens also of Hew York, would have been successful against the defendants in Illinois.

The Illinois proceedings are not therefore an estoppel, and we are driven back to the two questions, first, whether in a case like the present the law of Illinois or the law of Hew York is to govern ; and if the latter, then whether the plaintiffs’ title is superior to that of the -defendants by the law of Hew York. I have debated these questions at sufficient length in the opinion delivered at the circuit, and I have seen no reason, since the more extended and elaborate argument here, materially to change the views then expressed.

Perhaps some of the grounds upon which the propriety of determining the right to the property in question by the law of Hew York, in preference to that of Illinois, rested, were not made sufficiently prominent in the opinion delivered at the circuit. They may be briefly enumerated as follows : 1. The contracting parties to the contract or purchase under which the plaintiffs claim title, were citizens of the state of New York. 2. The instrument under which the plaintiffs claim was executed and delivered in the state of New York, and the consideration upon which it was based arose in that state. 3. The instrument under which the plaintiffs make title was a voluntary sale or assignment, and not a compulsory one. By a voluntary one is here intended not one without consideration, but one without compulsion—voluntary, as done by the party’s own choice and not in invitum. 4. The defendants are also citizens of the state of New York. 5. The debts for the collection of which the defendants’ attachment proceedings were instituted in Illinois, were contracted. and arose in the state of New York. 6. The attachment debtor also resides in the state of New York. 7. The forum of controversy is also in the state of New York.

The only facts upon which the defendants rely are that the property in controversy was situated in the state of Illinois, and was seized there under attachment proceedings regularly issued in Illinois.

These being the facts and circumstances of the case, I understand the law of the state of New York takes preference. (Hoyt v. Thompson, 1 Sel. 352. Story’s Confl. of Laws, §§ 379, 380, 383, 384, 411. Holmes v. Remsen, 20 John. 258. Abraham v. Plestoro, 3 Wend. 566. Johnson v. Hunt, 23 id. 96. Martin v. Hill, 12 Barb. 631. Tyler v. Strang, 21 id. 198.)

In the case of Martin v. Hill, (12 Barb. 631,) the plaintiff was the mortgagee under a chattel mortgage of certain oxen owned by one Willard, who was indebted to him, and which oxen were left in the possession of the mortgagor under circumstances rebutting the idea of fraud or bad faith. By the law of Vermont such a mortgage, unaccompanied by possession, was void. The mortgagor and mortgagee resided in Washington county, New York. The mortgagor having taken the oxen into the adjoining town of Fairhaven, in Vermont, they were seized upon there by the defendant, who was a constable of that'town, by virtue of an execution upon a judgment obtained in Vermont against the mortgagor, by certain citizens of that state. This action was brought to recover their value, and it was held that the nature, construction, obligation and effect of the mortgage must be determined by the laws of this state, and that the lex loci contractus controls as to the validity and. construction of personal contracts, and that the plaintiff was entitled to judgment. This was, however, but a special term decision.

In the case of Tyler v. Strang, (21 Barb. 198,) it was held at general term, in the 7th district, that where both the assignor and assignee of a contract are citizens of this state, and the assignment is executed in this state, and the subject of the contract is personal property, upon the general principle that the lex loci contractus controls the nature, construction and validity of the contract, the validity and effect of the assignment, and the delivery and change of possession of the property necessary to sustain it, depend upon our laws, although the property itself is situated in another state.

I cite these as comparatively recent cases in our own court in support of the general doctrine, maintained, I think, by the general current of authority, in favor of the applicability of the law of Hew York to the adjustment of the legal rights of the parties to this controversy.

I think the judgment of the circuit court was correct, and should be affirmed.

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Dissenting Opinion

Gould, J. (dissenting.)

I find the opinion of a majority of the court conveying, as it seems to me, an erroneous impression of the law of the state of Illinois. And as I deem that law to have a controlling effect in this cause, I make my opinion on that point more full and particular than the one I submitted at the term.

It is fully proved, and indeed the plaintiffs admit, that by the undisputed law of that state, had these plaintiffs undertaken there to claim this property, as being theirs by the assignment from Bates, the defendants, as creditors of Bates, having hy their attachment obtained the first actual possession, would have held the property. That is to say, by the law of Illinois, the property was then Bates’ as in favor of the attaching creditor whose attachment was levied, against the assignees, whose attempt to take actual possession was subsequent to that levy.

The defendants, having thus attached what, by the law of the land where they sued, was Bates’ property, pursued their remedy to judgment, (the property being all the time in the custody of the law;). and under an execution on that judgment they sold Bates’ property. After that sale, the plaintiffs in New York commence this suit against the defendants, for having committed a trespass in selling the plaintiffs’ property, on that execution; as, by the law of New York, the assignment passed the title of this property to the plaintiffs, prior to the levying of the attachment.

There is no pretense that there was any attempt, on the part of the defendants, to overreach the plaintiffs; or that there was any unfairness ‘in their proceedings; since the case shows that the suit in Illinois was commenced, and the attachment levied, before the defendants knew that Bates had assigned the property to the plaintiffs. And both parties were bona fide creditors of Bates—-having equal equities— and both, and Bates, were residents of Hew York.

To the judgment of the court of Illinois we are bound to give “full faith and credit,” (U. S. Const., art. 4, § 1,) and also to their public' acts. How, had the state of Illinois a statute, by which this property (as between these two parties) was Bates’, and was held as such by the attachment, can there be the least doubt that giving full faith and credit to their public acts would compel us to treat this property as Bates’, and held by the attachment ? -Would there be any wrong in saying that when Bates put his property in Illinois, he made it subject to the law of Illinois ? And I am unable to see that, because the rule before us is one of the common law of Illinois, it enters any the less absolutely into the essence of their judgment. A judgment, in a suit commenced hy attachment, acts in rem; and where the defendant is a non-resident, and is not personally served with process, it acts only in rem; as much so as if the subject of the suit were land situated where the suit is brought. Parties who send personal property to a foreign jurisdiction are as much bound by its laws as to that property as they would be in regard to land there situated, whenever, under that foreign jurisdiction, and by its laws, a lien on, or a right or title to, that personal property attaches. In this case, by the law of Illinois, the defendants, when their attachment suit went to judgment, had a lien on- this property, (which lien related back to the time of levying the attachment,) and which was by the sale perfected, as of the date of the levy, into a title, immediately derived from, and succeeding to, Bates’ title. And these plaintiffs never had any title in that state, and by its laws never could have any, as against these defendants.

As I uhderstand the authorities, this view is fully sustained hy them. Story (Conflict of Laws, § 550,) says, “ whenever personal property is taken by arrest, attachment or execution within a state, the title so acquired under the laws of the state is valid in every other state.” (3 T. R. 733. 9 Mass. Rep. 468.) For illustration, take a case which would seem closely analogous to the one before us: Were it the law of Illinois that a common carrier has not a lien for his charges upon the goods carried; and were a citizen of this state, acting as a common carrier, to transport for a citizen of this state goods through this state to Chicago; and there the owner of the goods were to take them from their place of storage in disregard of the carrier’s claim for, and demand of, his charges, (let the taking be with or without legal process ;) could the carrier, (having there made demand of the return of the goods,) on the return of both parties to this state, sue the owner for the taking of the property in disregard of the lien—the qualified title—which our law would have given him had the property reached the end of its transportation here ?■ Very plainly not.

I think a principle similar to the one I hold, has been held at general term, in the first district. A passenger on a steamboat was killed by an explosion of the boiler, within another state; and the passenger’s administrator, being a resident of this state, sued the proprietors of the boat, in our court, under our statute, which gives damages in such cases; and jurisdiction of the persons of the defendants was obtained by due service of process. The defendants demurred to the complaint, and the demurrer was sustained, because when, and where done, the act of the defendants gave no right of action under our law, which differed from that of the state in whose jurisdiction the injury was inflicted. (18 How. Pr. Rep. 335.) I can see no difference between a case where the statute laws so vary, and one where the common law of one jurisdiction is proved to differ from that of another.

Having at first paid more attention to this point of the case than to the nature and construction of the instrument by which Bates transferred the property to these plaintiffs, I allowed the transfer to pass as a valid one. But upon more careful examination, I am by no means satisfied that a debtor can transfer one part of his property, to secure or pay certain creditors, with a proviso that it shall not be sold, except at a specified price, or at such reasonable price as the assignor, or one of the assignees, shall in writing approve. It is a provision for an indefinite delay in the application of the property (and the return of the surplus, if any, to Bates or to the reach of his creditors,) at the arbitrary pleasure of the assignor and one of the assignees; and, if valid, no length of delay would authorize a creditor to expedite their movements. And it must be borne in mind, that if such a transfer of part of a debtor’s property be good, a like transfer of the rest of it must be. . So that, to sustain this transfer, it is necessary to hold that a general assignment with such a provision in it would be good.

[Albany General Term, May 7, 1860.

For both, or either, of these reasons, I think a new trial should be had; though I am reluctant to dissent from my brethren.

Judgment affirmed.

Wright, Gould and Hogeboom, Justices.]