52 N.Y.S. 893 | N.Y. App. Div. | 1898
An assignment for the benefit of creditors must be interpreted like other instruments, according to the intent of the parties, and, if possible, such a construction, given it as will sustain rather than defeat it. (Roberts & Co. v. Buckley, 145 N. Y. 215.)
When, however, the distribution of the estate is to be made unequally among the creditors, and some are preferred to others in payment, the assignment is not viewed by the court with any favor, and is only tolerated and upheld when all conditions are met for the prevention of fraud. (Mills v. Parkhurst, 126 N. Y. 89.)
And when it also appears that all the persons to be preferred in this unequal distribution of the estate are the relatives of the assignor, the assignment should be viewed with still less favor by the court, and the whole transaction rigidly scrutinized, to see that the provisions of the statute have not been availed- of to defeat its spirit and benefit the assignor and his family at the expense of creditors.
While it has been held that relationship between assignor and assignee, and a preference given to the latter as a creditor, prove nothing by' themselves, but are consistent with honesty and inno
Herd we have much more than the assignee being a relative and a preferred creditor ; all the other preferred creditors are likewise relatives, and the person to whom the property was finally, transferred is also a relative.
Many of the suspicious circumstances in this ease are transactions that occurred after the assignment; and while an assignment is valid or-invalid at the time of its execution, and cannot be made either by subsequent unconnected acts, yet subsequent acts may reflect light back upon the original intent and help us to discern that correctly. (Shultz v. Hoagland, 85 N. Y. 464; McNaney v. Hall, 86 Hun, 415.)
The use that is made of the assignment, and the acts of the,parties under it-, furnish data to judge of the motive and intent with which it was executed. (Forbes v. Waller, 25 N. Y. 430.)
And coupling these after occurrences with what took place before and at the time of the assignment, I cannot resist the conclusion that this assignment was made with the intent to hinder, delay and defraud the creditors of the assignor.
The assignor considered himself solvent; his reasons for making an assignment, as stated by him in brief, were that he thought more could be realized from his property in that way than if . his creditors entered up judgments against him, and his property was sold out upon execution; yet, so. far as appears frbm the evidence, only one of his creditors was pressing, and while he could not then r'aise the money to pay such claim, still it could have been adjusted, and time secured for its payment by giving his notes, indorsed by his father, extending over a series of months, with án agreement to renew them if he was unable to meet them, at maturity; his father expressed his willingness to indorse if he desired him to do so ; he agreed to furnish such notes,, specified the times when he would have them prepared, which promises he did not keep, and avows that he did not mean to keep them .when he made them; he makes an assignment to his father, whom together with other of his relatives he'makes preferred creditors; he remains in. possession and
Considering the circumstances under which this sale was made, it was incumbent, I think, upon the parties to it to show that the price was adequate; and if the apparent value of the remainder of the estate was not the real value I think it was incumbent upon the plaintiff to show that fact.
For these reasons I think the assignment should be held fraudulent and void, and it follows that the order and judgment appealed from should be reversed.
All concurred; Merwin, J., concurred in result.
.■ Judgment and order reversed and a new trial granted, costs to abide the event.
