Case Name: Klauber vs. Charlton
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1878-08
Citations: 45 Wis. 600
Docket Number: 
Parties: Klauber vs. Charlton.
Judges: 
Reporter: Wisconsin Reports
Volume: 45
Pages: 600–610

Head Matter:
Klauber vs. Charlton.
Bond of assignee for creditors; tohat informality not fatal'to assignment.
1. The statute of this state (oh. 64 of 1858) in terms requires the bond of an assignee for the benefit of creditors to be executed to the county judge or court commissioner as obligee.
2. Where the bond actually given by the assignee is substantially a good one, effectual to secure all the objécts contemplated by the statute, a merely formal defect or want of compliance with the statute in its execution will not render it or the assignment void. 22 Wis., 235; 85 id., 461.
3. By the provisions of the statute, the county judge or commissioner is a merely nominal or formal obligee, the bond being required to be filed with the clerk of the circuit court,-and all suits thereon for the benefit of creditors brought by such creditors in the name of the clerk or his successor in office. Held, therefore, that the bond in this case was valid and sufficient, although it ran to the clerk of the circuit court as obligee.
Utah, C. J., dissents.
APPEAL from the Circuit Court for Dane County.
In February, 1878, Bernard liohner, being insolvent, executed to Isaac Hlauber a general assignment, in the usual form, for the benefit of his creditors; and the assignee executed bis bond as such, with sureties, etc., also in the usual form, except that it ran to Bernard Esser as cleric of the circuit court for Dane county, and not to the county judge or a court commissioner of such county. The bond was approved by and delivered to the county judge, and by him filed with the clerk of the circuit court.
In the affidavit of one of the sureties on said bond as to his property qualifications, the blank space after the venue and before the words “ one of the sureties,” etc., was not filled in with the name of the surety, which was, however, signed by him at the end of the affidavit.
Immediately upon the execution of the assignment, the as-signee entered upon'the duties of his trust, and took possession, as such assignee, of the assets of the insolvent, including a stock of goods; but on the evening of the same day, defendant, as sheriff of said county, took possession of said stock of goods under an execution upon a judgment against said Nohner, and also under writs of attachment against his property, issued at the suit of creditors. The assignee thereupon brought this action to recover possession of the goods.
On the trial, defendant made proof of his right to hold the goods upon his writs in case the assignment was void. By direction of the court, a verdict was found for the defendant, and judgment was rendered against the assignee, who had ac quired possession of the goods under the statute, and against Samuel Klauber, as his surety in the action, for the value of defendant’s interest in the property, as' assessed by the jury. From this judgment the plaintiff and Samuel Klauber appealed.
For the appellants, separate briefs were filed by Sloan, Stevens <& Morris as attorneys, and by S. IT. Pinney, of counsel; and there was oral argument by Mr. Sloan and Mr. Pinney.
For the resjwndent, a brief was filed by Vilas <& Bryant, and the cause was argued orally by Wm. F. Vilas.

Opinion:
ÓktoN, J".
The plaintiff, Isaac Klauber, relies for his title to the property in question, upon an assignment made to him by one Bernard Kohner, for the benefit of his creditors. The only objection to this assignment, relied upon in the argument before this court, is, that the assignment is void because the bond, required by section 1 of ch. 64, Laws of 1858, to be given to the county judge or a court commissioner as the obligee, was in this case executed to the clerk of the circuit court.
The language of the first section, " execute and deliver to the county judge or court commissioner," and " satisfy the officer taking such bond," and of the second section, " be filed by the officer to whom such bond is executed," and of the third section, " in the presence of such officer to whom such bond is made," admits of no doubtful construction, and unquestionably requires such bond to be executed in form to the county judge or court commissioner as the obligee. Whether the assignment is void for this reason depends upon the further question, whether the bond so executed is void. If the bond is substantially a good bond, and effectual to secure all the objects and purposes contemplated by the statute, although not executed strictly according to the letter and formalities of the statute, it would be most unreasonable to assume that it was the intention of the statute that the assignment should be void. The statute does not provide that the bond here required shall be void for any departure from the statute which is not material; and this omission so to provide is proper to be considered in passing upon its'validity. Lewis, Governor, v. Stout, 22 Wis., 235. In tbe case of Hutchinson v. Brown, 33 id., 464, tbe validity of tbe assignment is made to depend upon tbe validity and sufficiency of tbe bond; and tbis case seems to be fully within tbe principle of that case, as to tbe validity of tbe bond supporting the assignment.
Tbe departure from tbe statute in that case was, that tbe bond was in a sum not less than tbe real value of tbe assets, and tbe statute requires tbe bond to be in a sum not less than tbe nominal value of tbe assets.
Tbe difference between the real and nominal value of tbe assets might be very great, and the nominal value would, in most cases if not invariably, be greater than the real value, and tbe bond based on such sum would be safer and better security for tbe creditors and the assignor, because in all cases it would be sufficient, while one based upon tbe real value might and probably would'be in many cases insufficient. Tbis would seem to be almost a material departure from the statute, as affecting tbe security of the creditors; and yet tbis court held in that case that both the assignment and the bond were valid, and the late eminent chief justice says in bis opinion, that "tbe objection thus taken savors very strongly of nicety, and an over-scrupulous regard for literal statutory construction," and that tbe bond in that case "will satisfy the real object tbe legislature bad in view, and accomplish tbe substantial purpose of tbe enactment;" and again: " Protection to the creditors being tbe great and only object aimed at by tbe statute, and that being fully attained, we cannot pronounce tbe bond insufficient."
Tbe statute, literally construed, requires tbe county judge or a court commissioner to be tbe obligee of tbe bond; but' why and for what reason or purpose it is so required, it is impossible to conceive. Tbe obligee in other cases generally has some discretion to exercise; ~or he has to administer some trust, or has some responsibility for the proceeds of tbe bond, when executed to him personally or colore officii; or bis name has to be used in suits upon tlie bond for his own benefit, or for the use of others; or he is required to have the legal custody of the bond; and, if given to him as an officer, his successors in office would have the same relations to it by substitution. But in this case, the obligee is merely nominal, and essentially formal. Neither the officer named as obligee nor his successors in office have anything whatever to do with the bond after its formal execution, except to file it in the office of the clerk of the circuit court; and it cannot even be sued in his name, or in the name of his personal representatives or official successors. The county judge or court commissioner, after taking such bond, executed to himself, eo nomine, or in the name of his office (and in which form the statute does not even direct), immediately files it in the office of the clerk of the circuit court; and all suits thereon for the benefit of the creditors of the assignor must be brought by such creditors themselves, and alone in the name of such clerk or his successors in office. This filing of the bond in the office of the clerk is equivalent to, and is in effect, an assignment of it, by the nominal obligee, to such clerk and his successor in office; and the statute operates as such an assignment vigore cujus, to the only proper person who can sue upon it. This is the indirect and unaccountable method prescribed by the statute; the method of accomplishing precisely the same result, far more direct and reasonable, would be to execute the bond to the clerk as the obligee, as was done in this instance.
Whether this was such a material variance from the requirement of the statute as to invalidate the bond, may well be answered in the language of this court above cited: " Protection to the creditors being the great and. only object aimed at by the statute, and that object being fully attained, we cannot pronounce the bond insufficient." In the case of Vandyke v. Weil, 18 Wis., 278, involving the question of the validity of an undertaking upon an appeal, this court said: "The intention of the legislature clearly was, to make the undertaking effectual to secure some benefit to the respondent in case the judgment was affirmed in any part or as to any of the appellants; and to attain that object a liberal interpretation is allowable. Such is the language of the authorities, and no doubt the correct rule of law. "We are to construe the undertaking in conformity to the intention of the act under which it was made, and with reference to which the makers must be supposed to have executed and delivered it, giving to both a fair and liberal interpretation to attain the end in view." In Lewis, Governor, v. Stout, supra, where the bond was executed to the governor, instead of to the state as the law required, and objection was taken to its validity by the obligors for that reason, this court held that, " the subject matter being sufficient, and the parties competent to contract with reference to it, the contract so freely executed is valid and binding. It is a good common-law obligation.". We do not think that this departure from the strict and literal requirement of the statute as- to the nominal obligee of the bond in this case is at all material, or that it impairs the validity of the bond as a statutory obligation, or at all affects the liability of the obligors upon it. " It is unnecessary to the validity of a bond taken under the statute, that it should strictly comply in every respect with the requirements of the statute. Nor is it void for slight departures from the statute, unless expressly declared to be so." Nunne v. Goodlett, 10 Ark., 89; 6 Term R., 702; 2 Bailey, 362. Whether this bond is valid as a statutory bond or as a common-law obligation, where it secures all the objects of, and in all other respects so fully conforms to, the statute, and the statute itself so fully provides its uses, and how and by whom and in whose name it shall be sued, and its proceeds made available to the creditors of the assignor, is quite immaterial; for its effect as a common-law bond, would, at most, in such a case, determine in whose name suit should be brought upon it; and here even that is provided for by the statute itself, which in that respect is imperative and explicit. The statute also determines the official succession of the bond, and therefore it is quite idle to speculate upon questions not in the case, and to which many of the authorities cited on both sides are alone applicable, as, whether the county judge or the clerk, as the obligee of this bond, is qxioad hoc a corporation sole, or whether'the personal representatives or assigns of either of them could sue upon it. In the case of People v. Jones, 22 Mich., 461, where the county treasurer, by the statute, was required to give a bond to the auditor general of the state as obligee, to be approved by the prosecuting attorney and circuit court commissioners of the county, before selling lands for taxes, and it was not approved by the prosecuting attorney, and only by one of the court commissioners, and where suit was, according to the statute in the cases of such bonds, to be brought in the name of the people, the bond was held valid. The language of the opinion of the chief justice in that case is far more applicable to the question raised in this case than to the one in that: "It may be»admittedfor the purposes of this case, that unless, as between the people and the defendants, this can be treated as a statute bond, the action shorrld have been brought' in the name of the obligee. Such seems to be the general current of authority — a doctrine, however, which, when applied to cases where the bond is valid, and was evidently intended by the parties for the same purpose as that required by the statute, savors more of technicality than justice and common sense."
The circuit court having ordered the j ury to find a verdict for the defendant for the reason that the assignment is void, because the bond does not conform to the statute, and for no other or sufficient reason, as appears from the record or the argument of counsel, the judgment must be reversed.