The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1856-11-12

ded for in It, II have been made with ineut to
defraud creditors, or . must contain provisions
which will avoid IL, although an actual honest in.
tent be conceded if denied, is proved. so far as
an actual intent to de'raad is involved ia this mo
ton, ID denied rs are all the extrinsc facts whcn
are alleged evidence OF IT, For al the purposes
OF this motion 1t must be taken to be true that all
Of HuntlDgt0ns property is insufficient 70 satisfy
his Just liabilities TO the Beldens aud the Harbecks
The question which this motion presents, on this
view OF the facts, is simply this:-A debtor, unable
being insufficient to pay two Of his credi-
t0rs, assigns IL all to third person in
trust to pay those two creditors. He SO assigns
it,, in good faith, aud without any intent 20
defraud any creditor. Is such an assignment void
merely because 1t does not contain nugatory pro-
vision to apply the surplus, if any there be- to pay
bis other creditors as far as it nay be sufficient
when II was impossible that surplus could exist to
be divided between them? l know Of no authority
which SO holds, and cannot believe that the rights
OF parties, in the absence OF any statute touching
the question. can be affected by such formalty
Ifthis view be correct then it follows that whether
the assignment be fraudulent or not depends upon
the intent with which it was made. All fraudu-
lent inent being denied by the answers,
and the assignment not being necessarily
tiff are fully denied by the answer, and
the motion should not be granted, as matter Of
course. In this connection, it may also be remark
go tina : 1t does not appear by the face of the as
of it alone, that Huntington had other creditors
than those for whom 1t provides. man may as
sign all his property to pay all his creditors. In
Ger to aSsail the assignment, therefore, to sug
gess ground for impea ching it, is becom neces-
creditors for whom it does not provide.
Such and other extrinsic facts are, or may
be, evidence of fraudulent intent. These
property assigned is sufficient to pay the credi
tors provided for, and that such was in fact the
estimate which the parties put upon It when the as
signment was made. This fact would seem to repel
all presumption Of an actual intent to defraud. be-
it would establish that no creditor was or could
be oefrauded. 1t must be obvious, as think, that
this assignment, If void, is so because it was made
with an actual intent to defraud, which those assail
ing it must establish, and that il cannot be held void
solely by reason of matters appearing its face.
Even if the assignment was void on its race, as
against creditors, avoidabe at their suit 1t would
be sufficient answer to the motion, in which Bishop
Is sole plaintiff TO say that 1t Is valid as between the
parties to it. That neither credit or at large, nor
any mere assignee appointed by Huntington, with
out the order or intervention of court, is in con-
dti0n to assai it. IL cannot be assailed an as
signment Of reality and of leviabe personal proper
ty, except by creditor who has recovered q judg-
ment and had an execution issued to the Sheriff
thereon And to reach chooses in action, the exc
cutons must have been returned, nuiia bona before
such an action can be commenced (McEl vain agt.
Willies, Wend. 54s. Spader agt. Hadden, 20. j.
r., 554. North Am. Fire Ins. Co. agt. Graham, 8
Sand. 1919 With respect to the action
brought by Bishop Stewart, If they have
valid Judgment and an execution which
hes been issued upon II, duly returned, so as
to give them standing in court, see no diff
Guilty in the way of judgment being rendered in
it. declaring the assignment to Halsey void, either
for aotu al fraud, or for matters appearing its
face, If the latter shall ultimately be dee med suf
foent to avoid it. There certainly is no obstacle TO
their recovering such q Judgment unless they are
pecluded from being plaintiffs in an action to avoid
the assignment to Kelsey, by the mere fact that
Bishop holds a general assignment, which he Is
seeking 10 uphold as valid, and which embraces all
the property Of Huntington. The Judgment Ii in
no way connected with the assignment to
Blshop. II Is hot npoh .h.s same trusts A.
H. or to be used il that should be held fraudulent.
Nor do see any improperly or incongruity IN the
Beldens and the Harbecks setting up the second as
sgnment, and its acceptance by Bishop, and insist
legal rights, the Court shall hold the first assign.
ment void, that then the Court should declare the
second assignment valid, and direct the debtors
property to be distributed under it. In all cases in
any relief consistent with the made by the
plant and embraced within the issue. (Code, S275.)
IL would be consistent with the case made by the
latter complaint to declare the first assignment void;
it would be consistent with the case made by the
complaint, and embraced within an issue upon facts
properly stated in the answer, which may result in
proving the due execution and acceptance Of the
second assignment to adjudge that the debtors pro-
latter assignment, unless all right 10 any such relief
must be ovenidden by the stern abstract principle
that the first assignment Is valid and not fraudn-
lent az against the second and Is valid ex
ditor having Judgment against the debtor, and
On execution issued thereon. But whether this
be so or not the first assignment, IL fraudulent,
may be set aside at the Instance Of Judgment
and execution creditors OF the assignor. I do not
deem II important, in order TO dispose OF this mo-
tion TO consider whether the Judgment confessed 10
the plaintifih would be set aside on motion, not
conforming to the requirements Of the code. think
the motion In the first suit should be denied on the
ground that the plaintiff Is not In position to ques
ton the legality Of the first assignment. In the
second suit 1t should be denied on the following
grounds, some OF which would he equally applicable
to the first sut II brought by party having legal
standing in court. which would enable him 10 ques
ton its yalidiiy:-i The assignment to Halscy Is not
void solely BY reason Of anything appearing on its
face, and irrespective Of extrinsic facts. ?. All
actual fraudulent intent, fully met by the an
sgers OF the defendants. =. There IL nothing alleg
ed against the integrity capacity OF the assignee
and there Is not hesllghtest ground for doubling
his responsibility. But while the assignee should
not be restrained from converting the property into
money, II may be Just TO prohibit him from dstri-
buting II until after judgment In these actions, un
less security be given TO account for the property.
and apply ITS proceeds or value as the court may
hereafter direct. Although the defendants state
in their answer that the assigned property
j. insufficient TO satisfy the liabilities which
IL was asdgnA TO pay, yet they do not
state the facts out Of which they arose, so that
the Court see that the claims are valid: nor Is
their amount named. There may. therefore, posi-
bly, he Wrplns. II 80, Il wosld 90 to the second
assignee assuming beth assignments 10 be valid.
Tie rh ntiffs may establish the invalidity Of the
first assignment, notwithstanding the denial this
motion of the truth Of the matters alleged TO show
actual fraud. The case presents many questions
that novel. The first assignee in point Of time,
is q clerk of his co defendants. But though compe
tent ard responsible yet the fact Of his being thus
situated, in connection with the other features pecu
liar 10 the case seems, In my Judgment, TO make II
proper to grant an order denying the motions, go
lar they seek 10 restrain the assignee from convert
ing the estate into money but providing that " shall
not be disposed Of until the further order OF the
court. unless bond he given by him and his code
e sndants, texcluding Huntington,) in a penalty OF
0000, condition 70 pay 10 each plaintiff such sum
~ he shall ultimately recover, and TO account for
the property. and apply it, value or proceeds and
nay them 70 such person or persons and in such sum
ar asthe courth hy order Judgment in either or
both actions, shall ultimately direct. On such
bond being given, with two sureties approved by
Justice Of this court each Of whom shall justify in