Case Name: Elwood & Co., appellants, v. Estate of J. S. Marsh, appellee
Court: Nebraska Supreme Court
Jurisdiction: Nebraska
Decision Date: 1891-01-02
Citations: 31 Neb. 134
Docket Number: 
Parties: Elwood & Co., appellants, v. Estate of J. S. Marsh, appellee.
Judges: The other judges concur.
Reporter: Nebraska Reports
Volume: 31
Pages: 134–137

Head Matter:
Elwood & Co., appellants, v. Estate of J. S. Marsh, appellee.
[Filed January, 2, 1891.]
Assignment for Creditors: Claims: Unavoidable Delay in Filing. Under the assignment law of the state, where the creditor of an assignor, without any laches on his part, is prevented from filing his claim within the time limited therefor by the county judge, he may afterwards present his claim for allowance and receive a pro rata share with the other creditors in the assets unadministered at the time his claim is filed.
Appeal from the district court for Webster* county. Heard below before Gaslin, J.
Kaley Bros., for appellant,
cited : Bank of Muskingum, v. Carpenter, 7 O., 71; Cheeseman v. Kyle, 15 O. St., 15; Ellis v. Carlisle, 16 Miss., 552; Suceession of Yarborough, 16 La. Ann., 258; Ferry v. West, 40 Miss., 233; Little v. Little, 36 N. H., 224; Oruikshank v. Cruikshank, 9 How. Pr. [N. S.], N. Y., 350; Trigg v. Moore, 10 Tex., 197; Wood, Lim., sec. 157; Tindal v. MeMillan, 33 Tex., 484; Cullerton v. Mead, 22 Cal., 96; Johnston v. Johnston, 36 la., 608; Perry, Trusts, sec. 867; Wilcox v. Jackson, 10 N. W. Rep., 665; Betters v. Farrell, 13 Id., 319 ; Mollison v. Mills, 25 Id., 631; Brewster v. Kendrick, 17 la., 479; McAfee v. Phillips, 25 O. St., 374; Smiley v. Sampson, 1 Neb., 87, 89; State v. Button, 25 Wis., 109.
D. F. Trunkey, and Case & McNeny, contra,
cited: Ellison v. Lindsley, 33 N. J. Eq., 258; Ln re Holt, 45 la., 301; McKindley v. Nourse, 67 Id., 118; Smith v. Wheeler, 12 N. W. Rep., 626; Ln re Burdick, 10 Daly [N. Y.], 49; Brewster v. Kendrick, 17 la., 479.

Opinion:
Norval, J.
This is an appeal from the district court of Webster county. The case is this: On the 14th day of January, 1888, John S. Marsh made a general assignment to the sheriff of Webster county. On the 23d day of January, 1888, the assignee filed his inventory with the county judge of the county, who on the same day fixed the 7th day of February for the meeting of the creditors to choose an assignee. The county judge gave notice of said meeting by publication as required by the statute, and mailed copies of such notice to each of the creditors. At the meeting of the creditors held on February 7, 1888, W. T. Auld was elected assignee, and qualified as such. On the same day the county judge fixed the 9th day of March, 1888, as the limit for filing claims against the estate. This order was published on February 8 in the Red Cloud Helmet and a copy of the notice was mailed, postage prepaid, two days later, to each of the creditors, including appellant. On the 2d day of April, 1888, the appellant filed with the county judge an unverified statement of his' claim, amounting to $1,501.01, besides interest, accompanied by the four promissory notes representing his debt. Afterwards, on April 15, he verified the claim. On June 2, 1888, the appellant filed his petition with the county judge for an allowance of the claim. At the hearing, the county court held that the claim was barred by the statute, and was not entitled to be considered in any distribution of the assets of the estate, but the assignee was ordered to retain in his hands $530.65, the amount of the dividend the appellant would have been entitled to had his claim been allowed.
An appeal was taken to the district court, where a trial was had to the court, with finding and judgment against the appellant, from which he appeals to this court. The justness of the appellant's claim is admitted. The sole question presented by the record is whether the appellant's claim is barred by the statute, it having been filed after the expiration of the date fixed by the county judge for filing claims.
Section 16, ch. 6, Comp. Stats., which relates to assign monte, provides that: "Upon the day of the meeting of the creditors the county judge shall fix a day, not more than sixty nor less than thirty days thereafter, within which all claims against the assigned estate shall be filed, and within which the assignee or assignor or any creditor may file any objection, defense, set-off, or counter-claim to any claim which the assignor might or could have opposed to the same had action been brought upon the same before assignment.. Notice of the time so fixed shall be given in the manner hereinbefore provided for notice of the first meeting of the creditors. Any claim, objection, set-off, or counter-claim not filed on or before the date so named shall be forever barred from being considered in the settlement of said estate or participating in any dividend therein."
A literal interpretation of the language of the section would perhaps bar the right of appellant to have his claim allowed in the settlement of the estate. But we think its provisions .should .be liberally construed, in order to carry out the object and purpose of the legislature in passing the assignment law, viz., to secure a fair and equitable division of the property of the assignor among all his creditors.
It will be observed that the section provides that notice of the time fixed in which claims shall be filed shall be given in the same manner as notice of the. first meeting of the creditors. The eighth section provides that the county judge shall immediately give notice of such meeting by publication in some newspaper published or of general circulation in the county, and also shall within two days after such publication mail a copy of such notice, with postage prepaid, to each creditor mentioned in the inventory of the assignor. The object of the notice is to give an opportunity to the creditors to present their claims for allowance and to share in the dividends. The undisputed testimony shows that no notice of the order of the county court, fixing the time for filing claims, was received by the appellant until after the time limited for that purpose had expired; that immediately thereafter the claim was filed, and that the failure to present it sooner was due to the lack of notice. It is clear that the appellant was not guilty of any laches. To hold that his claim should not be allowed, but be rejected in the settlement of the trust, would be unjust and inequitable and contrary to the whole spirit of the assignment law. Had a dividend been made before the appellant's claim was filed, then he would only have been entitled to a pro rata share with the other creditors in the assets not disposed of, for the rights of those creditors whose claims were filed in time, as well as the assignee, must be protected in any dividend already made. But in this case no dividend had been declared, and the appellant is entitled to receive an equitable share -in the settlement of the estate. Suppose on the last hour of the day fixed by the judge for presenting claims a fictitious or trumped-up claim should be filed against the estate, or one against which the assignor has a valid set-off or counter-claim; under the strict construction contended for by the appellee, any objection, counter-claim, or set-off, afterwards filed against such claim, but prior to its allowance,-could not be considered, although there was no opportunity to present the same in time.
We have examined and considered the authorities cited in the brief of appellee, and while some of them sustained a construction of the statute opposite to that which we give it, yet we do not see sufficient reason in those opinions to justify us in following them.
The judgment of the county and district courts are reversed and the cause is remanded to the district court with instructions to allow the claim of appellant.
Judgment accordingly.
The other judges concur.