The western Democrat. [volume] (Charlotte, N.C.) 1852-1870, 1868-10-20
Exemptions in Bankruptcy.


We are indebted to legal friend (says the
Raleigh SentineD for the following decision, rem
dered by Judge Brooks, at a recent Term OF the
District Court, relative to the matter of Exemp-
lions in Bankruptcy:
AT Elizabeth City, in the District of North
Carolina, on the 9TH day of October, 1868 The
question submitted by Mr. Register Lehman, in
this case, is: Can an Assignee OF an estate IN
Bankruptcy set apart money, which was not sur
rendered as money by the Bankrupt, but which
is or may be realized by the said Assignee from
the sale of chooses an action, or other property
scheduled and surrendered by him, under the
provisions for the exemption Of certain property
to the Bankrupt, contained in the act of 1867
/ have, heretofore, sn re Jno. W. Parish, GER
tilted from the 4th District, decided that a home
stead could not be exempted to the Bankrupt
claimed by him under the act of lo5S-'59, when
the party claiming it had not complied with all
the provisions of said Act; and in another case
that real estate was not properly embraced within
the meaning of the terms, articles or Necessa-
yiies. as used in the 18th Section of the Bank
ruptcy Act. . 5 -
But now the question is presented, can money
be assigned and paid by the Assignee to the
Bankrupt as an exemption, which money is to
be acquired BY the Assignee from the sales OF
any property which comes to him as Assignee
TO enable us to arrive at correct conclusion
upon this question, it is proper that We should
enquire, in the first place, how the Assignee de-
rives his title to the property of the Bankrupt.
The answer is that he derives his title by
virtue of the Bankruptcy Act, and the assign
ment made to him by the Judge or Register
pursuant thereto - .--E -..
Secondly, We should enquire what is the char
acter of the title he thus acquires to the property
oP r. &c olo nh hat &c
to the real estate, the Assignee takes estate
to himself and his heirs and, as to the person
atty, an estate to himself and his executors and
administrators.
Thirdly, For what uses and purposes does he
take the estate? The Assignee takes the estate
of the Bankrupt under the law, first to sell the
real and personal property and collect the chooses
in action, and, in this way, reduce the estate to
money If he cannot collect the debts due the
Bankrupt, he may sell such chooses in action as
the Court may order. When he has thus re-
duced the estate to money, he is required by
law to deposit the same, or pay the same ont as
the Court may direct, in the payment and salts
| faction of liens, mortgages, dividends and costs
of the proceedings -. -.
| Fourthly, What property of the Bankrupt
does the Assignee thus acquire title to, and for
the uses and purposes mentioned The answer
ton of the Act The first clause of this section,
being the 46th general clause of the act declares
| that when the assignment is made as provided,
thereupon. by operation of law, the title to all
such property and estate, both real and personal,
shall vest in said Assignee, and it declares that
all the estate of the Bankrupt, both real and per-
sonal, shall be thus conveyed and shall thus pass
to the Assignee, except only as hereinafter pro-
vided for in the 47th general clause.
| Now it only remains | think to be ascertained
what is excepted, by fair construction of the
last clause referred to, from the operation of the
conveyance of the Assignee. ...s~
| This clause Declares first, that the necessary
household and kitchen furniture, and such other
articles and neeessaries of such Bankrupt as the
Assignee shall designate and set apart, altogether
not to exceed in any case the value Of five hun
dred dollars, shall be exempt-that is excluded
from the provisions of this section; that such
property, so designated and set apart, shall not
in any way be affected by the conveyance to the
Asst nee OF the title thereto pass and subsc-
quent clause of the Act, as if to leave no room
for doubt, declares that the title of the Bank
rupt shall not in any way be affected or disturbed
by any of the provisions of the Act to any of
the property thus exempted and set apart under
the provisions of the law embraced in these ex-
ceptions. Also there is other property, as the
wearing apparel Of the Bankrupt and his family,
and such property as is exempted from seizure
or sale by creditor, by the laws of the United
States or the laws of the State, in which the
| Bankrupt resides, which were in force in the
year 1864. --r.- ....a ..... E.-
If the money attempted to be assigned by the
Assignee in this case, and which was to be re-
allied by sales as aforesaid can be construed to
be within the meaning Of the 47th clause then
it is good, as exemption otherwise, it is not,
and the Assignee would be bound to account for
the same strictly, in discharging the cases and
trusts upon which he took the title to the pro-
perty, from the sales of which the money was
realized. -'.- .--.-. .---,
Now think it quite clear, that the Assignee
could have assigned to the Bankrupt horse,
stock of any kind, a bond, note Or account, any
| article of personal property, and even money, if
the Bankrupt had scheduled and surrendered
such property, to make up any deficiency that
might exist, i'll his Judgment, after vauing and
assigning the necessary household and kitchen
| furniture; for all those articles and may be
to some Bankrupt necessarics But when any
| such article of property is actually assigned or
| designated, the title to the same does not pass
from the Bankrupt, by force of the assignment.
Therefore, the title to no article of property, so
designated, if within the meaning of the law,
ever vests in the Assignee. He could not then
sell or dispose of such property, and no one could
do so, save the Bankrupt. s<. ~ .~ss
My opinion is, that the title to all the property
of the Bankrupt, of every description, and all the
title he held in the same passed to the Assignee,
except the title to that household and kitchen
furniture and such other articles and necessaries
as have been designated and assigned under the
| law to the Bankrupt, and such other property as