162 Pa. 12 | Pa. | 1894
Opinion by
The question in this case is whether, under the act of May 12, 1891, P. L. 54, a creditor for wages has a lien on personal property transferred in good faith by an insolvent debtor inpayment of his debts.
Wm. Clegg, Jr., rented a mill and its machinery to Nau'lty, Evans & Co. They became indebted to him for rent, and in settlement thereof transferred to him all their personal property
While there were other questions involved, the case was taken from the jury by a peremptory instruction to find for the defendants on the ground that Naulty, Evans & Co., being insolvent, the transfer of their property in payment of the claim for rent was subject to the lien of debts for wages. Whether, if subject to such liens, they could be enforced in the manner indicated in the charge, it is unnecessary now to consider, as we are of opinion that no liens existed.
The Act of May 12,1891, P. L. 54, is amendatory of the Act of June 13, 1883, P. L. 117, which act is an amendment of the Act of April 9, 1872, P. L. 47. Each successive act enlarges the class of persons intended to be benefited, but in other respects no material change has been made in the legislation upon the subject.
The Act of 1891 provides that moneys due for wages of certain enumerated persons, within limits as to time and amount, shall be liens upon real or personal property sold by execution or otherwise on account of the death or insolvency of the employer, and shall be first paid out of the proceeds of the sale of such property. Omitting the parts that are descriptive of the classes of persons and kinds of property included, the effective portion of the act is : “ . . . .all moneys due for labor . . . . for any period not exceeding six months preceding the sale of the real or personal property . . . . by execution or otherwise on account of the death or insolvency of such employer, shall be a lien on such real or personal property . . . and shall be preferred and first paid out of the proceeds of such sale.”
The jury were in effect instructed that the sale by the tenant to the landlord, while not fraudulent in fact or in law, was an act of insolvency, and that the creditors for wages had liens upon the goods sold which could be enforced by a lev}' under judgments subsequent^' obtained.
The construction placed upon the act by the learned judge would create a class of liens of the most dangerous and obnoxious character. No one could purchase property without assuming the risk of .the insolvency of the vendor. The principle is the same whether the sale is of a part or of the whole of the debtor’s property, and whether the sale is in payment of a particular debt or to realize funds for general use, either in the payment of debts or the conduct of business. It is the established rule in this state that a debtor may prefer a creditor, and it was as lawful for Naulty, Evans & Co. to transfer their property to one creditor as it would have been to sell it to a stranger.
The first assignment of error is to the admission of testimony which went to the good faith of the transfer, and which was properly received. This assignment is overruled, and the remaining assignments are sustained.
The judgment is reversed and a venire de novo awarded.