Case Name: WOOLSEY v. URNER
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1834-05
Citations: 1 Ohio Ch. 606
Docket Number: 
Parties: WOOLSEY v. URNER.
Judges: 
Reporter: Reports of cases at law and in chancery Ohio
Volume: 1
Pages: 606–607

Head Matter:
WOOLSEY v. URNER.
Fraudulent assignment — release.
A clause in an insolvent’s assignment of his effects declaring it inoperative as to creditors, who do not within sixty days execute a release of their whole debt, and become parties to the assignment, makes it void as to disagreeing parties.
The plaintiff under legal process against De Witt, an absconding debtor, attached a quantity of merchandise in the hands of the defendant, and having recovered judgment against De Witt, has now brought a scire facias against the defendant as garnishee.
The defendant pleads that De Witt, before the attachment, assigned -all his property, including the goods attached to' him, for the benefit of De Witt’s creditors.
The plaintiff replies, that at the date of the assignment, he was a creditor of De Witt’s, and that the assignment under which the plaintiff claims as trustee, contains amongst others the following clause, making it void in law, as against the plaintiff, that is to say:
‘Thirdly. After, satisfying in full the claims first and second above specified, then to pay and distribute all the residue of said proceeds,pro rata, according to the amount of the respective claims, among all the remaining creditors of the said De Witt, named or referredi to in the schedule hereto annexed: Provided, however, and on this condition, that .all and each of the said creditors of every class and description, shall, within sixty days 'from the date hereof, become parties to this assignment by executing the same and releasing the said De Witt from all claims and demands whatever, and that each of said creditors on becoming partners to this assignment, shall surrender to the said assignee all notes, drafts, acceptances, bonds,- and obligations whatever, that they may hold against the said De Witt, and no part or share of said property assigned, or of the proceeds thereof, shall be paid to any of the creditors of any class who shall not within the time aforesaid, have become parties as aforesaid and released the said De Witt as aforesaid.’’
To this replication there is a general demurrer and joinder.
Chase, for the demurrant,
insisted that the assignment was valid. The preferred debts here were small in amount, and the whole deficit not more than twenty-five per cent. He cited 2 Binney R. 174; 14 John. R. 458; 3 Price R. 6; 2 Pet. R. 675; 5 Mass. R. 72; 4 Mason R. 222; VJ Mass. R. 454; 5 Pick. R. 28; 8 Pick. R. 298; 5 Greenl. R. 245; 6 Greenl. R. 395; 2 Paige R. 491; 4 Wash. C. C. R. 232.
Starr, contra.

Opinion:
Wright, J.
The only question presented by this demurrer is, whether the clause in De Witt's assignment, which declared it inop erative as to those creditors who refuse to execute a release and surrender the evidence of their demands within sixty days, makes it void? In Atkinson Rawlins vs. Jordan, Ellis & Co. (5 O. R. 363,) it was decided, after a full examination óf the authorities,.that an assignment by failing debtors of their effects, with a provision, prohibiting .from participating in its benefits, creditors who did not execute a release of their whole debt upon a mere possibility of receiving a portion of the proceeds, was an attempt to place the assignor's effects beyond the reach of legal process, in order to coerce a relinquishment without a consideration, and therefore void as against creditors refusing to come in.- The case before us, seems, in principle, precisely within that decision. The reflection we have bestowed upon that decision since it was made, has father strengthened our confidence in its correctness. The demurrer is overruled.