Case ID: md_15/html/0063-01.html
Source: Caselaw Access Project
Author: {"author": "Le Grand, C. J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Charles Farquharson vs. Otho H. Eichelberger & Jacob Trust, Garnishees of Lewis A. Muncks.
    A deed of trust, for the benefit of creditors and exacting releases, in Hs premises conveys to two trustees, “and the survivor of them, and the executors and administrators of such survivor, all and singular the goods, wares, merchandise, stock in trade, chattels property and estate, of every kind and description, belonging to the” grantor. The habendum is, “to have and to hold all the said estate and property, stock in trade, chattels and effects,” unto the said trustees, “and the survivor of them, and the executors and administrators of such survivor, in trust, ”&e. Held:
    That this deed conveys all the e,state, real and personal, of the grantor, and a fee-simple interest in his lands, if he had any.
    When the grant made by the premises is in conflict with that contained in the habendum of a deed, the limitation contained in the latter must be “ejected, and the estates given in the former must prevail.
    Ill a deed of trust conveying property to pay debts, the omission of the Words, “and his heirs,” does not confine the grant to personally, hut where the intent to convey all the grantor’s property is manifest, a fee-simple in rtalty also passes by implication, under the deed.
    The recording of a deed of trust for the benefit of creditors and exacting releases, is, in the absence of fraud, sufficient notice to the creditors.
    It is no valid objection to an assignment for the benefit of creditors and exacting releases, that it provides that the trustees shall,- as soon as conveniently may be, sell and dispose of by public auction,- or at private sale, so much and such parts of the stock in trade, property and estate,”' conveyed, “as are in their nature saleable, for the most money that the same will produce, in ready money, or on such terms of credit as the said trustee may approve.”
    Nor is it a valid objection to such an assignment that it provides for the payment, as a preferred debt, “of whatever rent may be due, or become due on the store or warehouse rented by the grantor, until the stock in trade conveyed by the deed shall be sold and disposed of by the trustees, as above stated.”
    It is no objection to such an assignment that it-provides that the trustees shall not be “accountable for any loss or damage which may happen in and about the management or disposal of the trust estate, unless th'e ■same shall be occasioned by their "wilful neglect or default.”
    
    Appeal from fee Superior Court of Baltimore city-.
    
      Attachment on judgment issued at the instance of the appellant-, -on the 2clrd of Nove'mb'ei-1855, arid on the next day laid in the hands of Eichelberger and Trust, as garnishees of Muncks, the judgment debtor. Plea nulla bona.
    
    
      Exception. — it was admitted that Muncks, 'on the day of its date, executed the deed of trust, hereinafter mentioned; by which he 'conveyed all his property, debts and effects to the garnishees;, who accepted the trust, took possession of the property and -assets and immediately sold the same for cash, realizing thereby the net sum of -$3222.99; that they also proceeded to 'collect the debts, and after deducting expenses and commissions, they have received from all sources a total sum of $9133.25; of which they have paid to the creditors an'cl persons named in the schedule annexed to the deed, $4643.30, leaving in their hands -a balance-of $4489.95; "that creditors of Muncks, having claims amounting to $8600, in addition to these mentioned in the schedule, have accepted the 'deed and signed a release of their claims against him; that besides these arid the claim of the plaintiff, there are creditors who claim to have due them in the aggregate about $1500, who have failed to accept the terms of the deed. It was also admitted that the day after the deed was executed, notice was given to the creditors of Muncks that it had been executed and that a preference was given by it to the creditors who should release within sixty days, by advertisement in the Baltimore American and Sun, and copies of such vertisemeut sent to the creditors living out of the city, and that the plaintiff is a citizen of Baltimore. It was also admitted that at the date of this deed Muncks was indebted to the plaintiff, for which debt the latter, in September 1855, recovered the judgment for $555, with interest and costs, on which this attachment issued, and that at the date of the deed Muncks was also indebted to other persons besides the plaintiff, in various amounts, which he was unable to pay.
    The deed referred to is dated the 16th of December 1854, It recites that, “Whereas, the said Lewis A. Muncks is indebted to divers persons and firms in various sums of money which he is unable now to pay, but being willing and desirous to provide for and ultimately to secure the payment of all said debts and sums of money, so far as his present means will extend, has, with that view, determined to execute these presents. ’ ’ It then, in its granting part, conveys to said Eichelberger and Trust, “and the survivor of them, and the executors and administrators of such survivor, all and singular the goods, wares, merchandize, stock in trade, chattels, property and estate of every kind and description, belonging to the said Lewis A. Muncks, and all debts, sum and sums of money, books of account, claims and other things due, owing and belonging to the said Lewis A. Muncks, and all his estate and interest therein; to have and to hold all the said estate and property, stock in trade, chattels and effects, debts, claims and sums of money hereby mentioned to be conveyed,” unto the said trustees, “and the survivor of them, and the executors and administrators of such survivor,” in trust, that the said trustees, “and the survivor of them, and the executors and administrators of such survivor, shall use due diligence to get into their possession the estate and property, hereby assigned and conveyed, and to collect and receive the debts and sums of money hereby assigned; and to that end” the grantor appoints the said trustees, “and the survivor of them, and the executors and administrators of such survivor,” his attorneys irrevocable, in his name or otherwise, to adjust, settle and liquidate all accounts relating to the premises, “to collect, and receive all the debts and sums of money hereby assigned, execute receipts for the same, and “to compound for any bad or dubious debt or debts, and one or more attorney or attorneys, agent or agents, under them, or either of them, for all or any of the purposes aforesaid, from time to time, to appoint, and again at his or their pleasure to displace,” and upon the further trust, that the said trustees, “or the survivors of them, and the executors and administrators of such survivor, do and shall, as soon as conveniently may be, sell and dispose of by public auction, or at private sale, so much and such parts of the stock in trade, property and estate aforesaid, as are in their nature saleable, for the most money that the same will produce, in ready money, or on such terms of credit as the said trustees may approve,” and to apply the proceeds and the moneys collected from the debts and claims hereby assigned, to pay, 1st, the expenses incurred in the preparation, acknowledgment and recording of this deed, and the discharge of the trust, with all necessary counsel fees and all other proper costs and charges, including the hire and employment of the necessary clerks, accountants and other assistants, to close up the business of the trust, and a commission of eight per cent, to the trustees, on all moneys that may come into their hands by virtue of the trust; 2nd, “to the payment of any taxes now due on the aforesaid stock in trade, and of whatever rent may be due, or become due, on the store or warehouse on Baltimore street, rented by” the grantor, “until the aforesaid stock in trade shall be sold and disposed of by the said trustees, according to this agreement, as also to the payment of the sum of $80.38,” a balance of one year’s service due a clerk in the employ of the grantor; 3rd, “to the payment and discharge in full of the several and respective debts,” specified in a schedule annexed to the deed, and to the payment of certain other claims specified in the deed. It then provides that the residue of the trust moneys shall be held by the trustees, “and the survivor of them, and the executors and administrators of such survivor in trust, to be applied to the payment of the sum of $3000-loaned” by J. Matthias to the grantor, “and also to the payment and satisfaction, equally with the said Matthias, and in full or pr& 
      
      Tala, as the said assets may permit, of all the creditors of” the grantor, other than the said Matthias, “whether in other respects preferred or not, who shall, within sixty days from the date of this deed, signify their assent to the terms hereof and execute and deliver to the” grantor “a full and final release and discharge of and from all claims and demands against him to the time of executing these presents, and after the payment of said creditors in full, if there should remain a surplus, then in trust for the remaining creditors of the” grantor “equally, and in case of any surplus, after paying all the creditors of the” grantor, “and, only in such case, then the surplus, if any, shall be in trust for the said” grant- or, “his executors, administrators or assigns.” The deed then provides “that the said trustees shall not be chargeable ■ for any more than what they shall actually receive by virtue of these presents, nor accountable for any loss or damage which shall or may happen in and about the management or disposal of the said trust estate, unless the same shall be occasioned by their wilful neglect or default.”
    This deed was, on the day of its date, duly executed and acknowledged by the grantor, and was also signed by the trustees, as evidence of their acceptance of the trust, and they also, at the same time, made oath that the consideration stated in it was “true and bona fide, as therein set forth.” It was endorsed as “an assignment of chattels in trust,” and on the same day recorded among the chattel records of Baltimore city.
    The plaintiff then asked the court to instruct the jury that said deed of trust was void:
    1st. Because it authorizes and empowers the trustees therein named, as soon as conveniently may be, to sell and dispose of, by public auction, or at private sale, so much and such parts of the stock in trade, property and estate by said deed conveyed, as are in their nature saleable, for the most money that the same will produce in ready money, or on such terms of credit as the said trustees may approve.
    2nd. Because it authorises the trustees to sell the property by retail, or in parcels, as they may deem eligible.
    
      3rd. Because, by the terms of the deed, the trustees are not accountable for any loss or damage which shall or may happen in and about the management or disposal of the trust estate, unless the same shall be occasioned by their wilful neglect or default.
    4th, Because no notice was by the deed required to be given to creditors to file their releases, although the filing of such releases within sixty days is, by the deed, made essential to the right of creditors- to come in among the preferred creditors:
    5th. Because the deed provides for the payment, as a preferred debt, of whatever rent was due at the date thereof, or should thereafter become due, on the store or warehouse ' on Baltimore street, rented by the grantor, until the stock in trade conveyed by the deed should be sold and disposed of by the trustees.
    6th. Because the said deed hinders, delays and defrauds creditors.
    The court (Lee, J.) refused to give this instruction, and to this refusal the plaintiff excepted, and the verdict and judgment being against him, appealed.
    The cause was argued before Le Grand, O. J., Eccleston and Tuck, J.
    
      Frederick W. Brune, for the appellant,
    argued that this deed was void:
    1st. Because the power of sale given to the trustees is not a clear direction to sell the entire trust subject, but only so much and such parts thereof ■ as are in their nature saleable; thus leaving a portion of the trust subject undisposed of, which would belong to the grantor as a resulting trust.
    2nd. Because if the power of sale should be construed to be a direction to sell and dispose of the whole trust subject, except the debts and claims, it is a direction to sell at private sale, as well as by public auction, and in parcels or by retail, and upon such terms of credit as the trustee shall approve.
    3rd, Because this power of sale is extended and conferred; upon tlie executor or administrator of the surviving trustee, and is not required to be exercised until said parties can conveniently do so; and by these and other provisions, such as that directing the payment, out of the trust property, of the rent which should accrue upon the warehouse of the grantor until the stock in trade should be disposed of, a delay in making the sales is authorised by the deed beyond what is necessary for the purposes of the trust, and a gradual disposition of the trust properly, at private sale, upon such terms as the trustees may approve, expressly permitted.
    4th. Because the deed was intended to convey, and only conveys the personal property of the grantor, and does necessarily and without any reservation whatever to himself, plainly and affirmatively appearing on the face of the deed, convey absolutely all his property, real and personal, and a fee-simple in his lands, if he had any, but only a life estate therein, and at the same time grants preferences and requires releases from his creditors, under the penalty of a postponement of their right to participate in the property conveyed.
    In support of these positions, reference is made to 3 Md. Rep., 11, 38, 39, Green vs. Trieber; Ibid., 40, 48, 51, 52, Sangston vs. Gaither. 8 Md. Rep., 426, Malcolm vs. Hodges. 7 Md. Rep., 391, 393, American Exchange Bank vs. Inloes, and same case in 11 Md. Rep., 182. 11 Md. Rep., 380, Rosenberg vs. Moore. 14 Md. Rep., 28, 29, 30, Barnitz vs. Rice. 9 Barb,, 256 to 258, Woodburn vs. Mosher. 9 G. & J., 77, Hope vs. Hutchins. 18 Pick., 539, Godfrey vs. Humphrey. 20 Pick., 256 to 258, Bullard vs. Goffe. 7 Taunt., 79, Doe vs. Rout. 1 Md. Rep., 344, McChesncy vs. Bruce. 3 Md. Rep., 446, Cole vs. Ensor. 6 H. & J., 228, Beall vs. Holmes.
    
    
      R. R. Battee and Levin Gale for the appellees.
    1st. The deed provides that the trustees shall, as soon as conveniently may be, dispose of the property, for the most that it will bring in ready money or on such terms of credit as they shall approve,- and further that the trustees shall pa,y the rent of the store theretofore occupied by the grantor until the stock of goods shall be disposed of in pursuance of the deed. From these two provisions the appellant seeks to draw the conclusion that the deed is void: 1st because it allows a sale on credit; and 2nd, because it authorises a sale of the property by retail or in parcels. Without granting the second reason, the appellees insist, that these provisions only give to the trustees a reasonable and sound discretion in the exercise of their duties, which it was proper they should have. 11 Md. Rep., 184, American Exchange Bank vs. Inloes; 13 Md. Rep., 179, Maennel vs. Murdoch; 13 Md. Rep., 538, 566, Berry vs. Matthews.
    
    2nd. Another objection is, that by the terms of the deed, the trustees are not liable for loss or damage to the estate unless occasioned by their wilful default. ' To meet this objection, the appellees refer to and rely upon 13 Md. Rep., 175, 180, Maennel vs. Murdock; 4 Gill, 133, McCall vs. Hinkley; 8 Gill, 473, Kettlewell vs. Stewart.
    
    3rd. A third objection is, that the deed gives a preference to such creditors as shall release within sixty days, but makes no provision for notice to the creditors. To this objection the appellees answer, that all the deeds requiring releases which have been before this court are similar in terms, in reference to this provision, and that not one of them contains a clause requiring notice to be given to creditors. The recording of the deed, which is necessary to give it validity, is notice to all the world, and especially to auditors and others interested in the property. 8 Gill, 473, Kettlewell vs. Stewart; 4 Gill, 132, McCall vs. Hinkley; 11 Md. Rep., 250, Williams vs. Banks; 13 Md. Rep., 493, Cooke’s lessee vs. Kell.
    
    4th. Another objection, which was not urged in the court below, but now presented for the first time, upon the authority of Barnitz vs. Rice and Rosenberg vs. Moore, is, that the deed does not upon its face convey all the property of the grantor, real as well as personal, and but a life estate in his land, if he had any. To this the appellees reply that the terms of this deed are unlike those in the cases referred to, and that it does embrace all the grantor’s property of every description. The terms “estate of every kind and description” are the-most comprehensive that could be used, and are clearly sufficient to pass real estate, and in such a deed as this it is not necessary that the word “ heirs” should be used in order to pass a, fee-simple in land. 9 Gill, 262, Spessard, et al., vs. Rohrer, et. al. In the case of Malcolm vs. Hodges, 8 Md. Rep., 419, the same words were held sufficient to pass ail the grantor’s property, real as Well as personal.
    
   Le Grand, C. J.,

delivered the opinion of this court.

This is an attachment. The debt, and a sufficiency of funds in the hands of the garnishees to pay it, are not denied. The defence, is, that on the 16th day of December 1854, the defendant, Lewis A. Muncks, executed a deed to the garnishees of his property, for the payment of his debts, in reply, the plaintiff contends that this deed is void, and asked the court below to so instruct the jury, which the court refused to do. Upon the validity of the deed depends the decision of this case.

In its premises, or recital, it declares, that the said Lewis A. Muncks “hath granted, bargained and sold, assigned, conveyed, transferred and made over, and by these presents doth grant, bargain and sell, assign, transfer, convey and make over, unto the said Qtho W. Eicheíberger and Jacob Trust, and the survivor of them, and the executors and administrators of such survivor, all and singular the goods, Wares, merchandise, stock in trade, chattels, property and estate of every kind and description belonging to the said Lewis A. Muncks, and all debts, sum and sums of money, books of account, claims, and other things due, owing and belonging to the said Lewis A. Muncks, and all his estate and interest therein.” In the habendum of the instrument it is said, that the grantees are “to have and to hold all the said estate and property, stock in trade, chattels and effects, debts, claims and sums of money hereby mentioned to be conveyed, transferred and assigned, unto the said parties hereto of the second part, and the survivor of them, and the executors and administrators of such survivor, in trust and ■confidence,” <fcc„

The reasons assigned in argument why the deed should be considered void, are somewhat different from those urged at the trial below. It is urged before this court, that the deed was, and is, void, because it was intended to convey, and only conveys, the personal property of the grantor, and does not necessarily convey all his property, real and personal, and not a fee-simple interest in his lands, if he had any. This objection was not embraced in the instruction refused by the court, but had it bedn we do not think it should have availed.

In construing deeds of trust in favor of creditors; this court has, on more occasions than one, said; that the deed, on its face, must convey all the property of the grantor, and that the. deed must be interpreted by its own language: Rosenberg & Blondheim vs. Moore, 11 Md. Rep., 381. The question then is, does this deed convey all the estate, real and personal, of the grantor? We are of opinion it does do so. In the premises the grant is, of his “ estate of every kind and description. ’ ’

In the case of Budd vs. Brooke, et al., 3 Gill, 235, thfe the court holds the following language, which is conclusive of question: “The technical meaning of the word‘premises,’ in a deed of conveyance, is everything which precedes the habendum, and it is in the premises of a deed that the thing is really granted,” Speaidng of the case then before them; the court proceeds to say: “According to our construction of the grant, made by the premises, i-t is in direct conflict with that contained in the habendum Both cannot prevail. One must overrule the other. Which takes precedence, is the question? In our opinion, the limitations contained in the habendum must be rejected, and the estates given in the premises must prevail. In 2 Lomax’s Dig., 188, it is stated, that ‘where there are two clauses in a deed, of which the latter is contradictory to the former, then the former shall stand.’ And at page 215, of the same book, it is said, that ‘where the habendwn is repugnant and contradictory to the premises, is is void, and the grantee shall take the estate :given in tire premises. ’ ’ ’

(Decided February 27th, 1860.)

The objection that there are no words of inheritance in the deed, is fuliy answered by the case of Spessard and others vs. Rohrer and others, 9 Gill, 261, in which it was decided that, in a deed of trust, conveying property for the payment of the debts of the grantor, the omission of the words, uand his heirs,” did not have the effect of confining the grant to personalty, but where the intent to convey all the property of the grantor was manifest, a fee-simple in realty also passed, by implication, under the deed.

All the other exceptions to tlie deed, with the exception of the one which declares against its validity because it does not require notice to be given to the creditors, arc answered by the case of Maennel et al., vs. Murdock et al., garn. of Falconer & Haskell, 13 Md. Rep., 164. In regard to notice, the recording is, in the absence of fraud, sufficient. Williams vs. Banks, 11 Md. Rep., 250. Cooke’s lessee vs. Kell, 13 Md. Rep., 493. Perceiving nothing erroneous in the ruling of the court we affirm its judgment.

Judgment affirmed.