Case Name: Eau Claire Grocer Company, Appellant, vs. Hubbard, Garnishee, Respondent
Court: Wisconsin Supreme Court
Jurisdiction: Wisconsin
Decision Date: 1897-12-10
Citations: 97 Wis. 661
Docket Number: 
Parties: Eau Claire Grocer Company, Appellant, vs. Hubbard, Garnishee, Respondent.
Judges: 
Reporter: Wisconsin Reports
Volume: 97
Pages: 661–666

Head Matter:
Eau Claire Grocer Company, Appellant, vs. Hubbard, Garnishee, Respondent.
November 17
December 10, 1897.
Voluntary assignment, construction of.
1. In the construction of assignments for the benefit of creditors, the ordinary rules governing the construction of contracts are to be applied.
2. An assignment for the benefit of creditors made by three persons, two of whom, G. and G., were partners under the firm name of G. & Go., and they with H. constituted the firm of G. & H., recited: “ This indenture by and -between G., G., and H. of the firm of G. & H., parties of the first part.” The affidavit as to the valuó of the assigned property referred to it as that of “G. & H.” The assignee’s bond described him as the assignee of “G. & H.” He entered upon his duties as assignee of that firm. The property inventoried belonged to that firm; and the creditors scheduled were none other than creditors of that firm. Held, that it was the evident intention of the parties that the assignment should be, and it was, that of the firm of G. & H. and not an individual one of the persons composing that firm.
Appeal from a judgment of the circuit court for Trem-pealeau county: O. B. WymaN, Circuit Judge;
Affirmed.
Tostin I. Gilbert and Gulbrand 0. Gilbert were partners in business at Blair, Wisconsin, under the firm name of T. I. Gilbert & Co. As such, they and Alexander C. Hallenger were partners iri business at Eleva, Wisconsin. On the 12th day of January, 1894, the three persons named executed an assignment for the benefit of creditors, intending to comply with the statutes of the state of Wisconsin on that subject. The deed of assignment described the grantors in the following language: “ This indenture, made and entered into this 12th day of January, A. D. 1894, by and between Tostin I. Gilbert, Gulbrand 0. Gilbert, and Alexander 0. Hallenger, of the firm of Gilbert & Hallenger of Eleva, . . . parties of the first part.” Thereafter the three persons named were referred to sometimes as “ parties of the first part,” and at others as “ party of the first part.” The affidavit as to the value of the assets upon which the bond was based was to the effect that the nominal value of the assets of the firm of Gilbert & Hallenger, assignor mentioned in the bond of assignment, was $21,000. The assignee took possession of the property of the firm, and entered upon the duties of his trust, and complied with all the requisites as assignee for the benefit of the creditors of the firm of Gilbert & Hallenger. Thereafter this action was commenced to charge the assignee as garnishee, upon the ground that the assignment was an individual assignment of all the property of the assignors, while the bond of the assignee was given with reference only to the value of the assets of the firm of Gilbert & Hallenger. There was evidence produced to show that the firm of T. I. Gilbert & Co. had a large amount of property other than tbeir interest in the firm of Gilbert & Hallenger. The case turned on the construction of the deed of assignment, as to whether it was a firm or an individual assignment. The trial court found for the defendant, sustaining the assignment as that of the firm of Gilbert & Hallenger. Judgment was entered accordingly, from which the plaintiff appealed.
V. W. James, for the appellant,
argued that the language of the assignment shows that it was intended to convey the individual property of each of the assignors. The tetuns “ of the firm of G. & H.” are merely deseripUo personae. The assignee’s bond was insufficient, under sec. 1694, S. & B. Ann. Stats., not being equal to the value of their individual property. Williams v. Hadley, 21 Kan. 350; Yon Wettberg v. Carson, 44 Conn. 289.
G. W. Oilman, for the respondent.

Opinion:
Maeshall, J.
The maxim, "ut res magis valeat guampe-reat," — the instrument in question shall rather be made available than suffered to fail,— applies in construing a deed •of assignment for the benefit of creditors where the language thereof is of doubtful meaning. If the deed will admit of two meanings the court is permitted, when called upon for its judicial construction, to consider all the circumstances of its execution,0the situation of the parties, the necessities that called the instrument into existence, the motives that actuated its makers, the reasonable probabilities as to what would ordinarily be done by persons circumstanced as such parties were, and all the facts and circumstances which led up to and characterized the transaction, in determining just what was intended thereby, to the end that a construction may be adopted that will give effect to such intention if it •can be done without doing violence to the rules of language •or of law, rather than that the instrument should fail en-. tirely. In short, the ordinary rules governing the construction of contracts between parties apply, and with peculiar force where the manifest legislative policy points that way. Knapp v. McGowan, 96 N. Y. 75; Townsend v. Stearns, 32 N. Y. 209; Crook, v. Rindskopf, 105 N. Y. 476; Bank of Mobile v. Dunn, 67 Ala. 381; Burrill, Assignments, § 285.
Applying the foregoing to the facts of this case, no serious-difficulty is encountered in arriving at a conclusion as to the-proper construction of the instrument in question. If we-say the intention of the parties was to make an individual assignment, it would probably follow that the instrument would fail entirely for want of a proper bond, required by statute. Therefore, that construction should be rejected if the instrument will reasonably admit of another which will uphold it. This rule should be given all reasonable latitude,, since the legislative policy of this state, as evidenced by recent legislation on the subject, is to favor and uphold assignments for the benefit of creditors, rather than otherwise. As before stated, in effect, where the trend of legislation is such as to show a manifest purpose to secure an equal distribution of the property of insolvents, whenever they, in-good faith, make a conveyance of all their property with that intention, the courts, so far as possible, should carry out such legislative policy, and supplement it by the most liberal construction of deeds of assignment they will reasonably bear, to the end that they may be maintained instead of defeated. Cunningham v. Norton, 125 U. S. 77.
Looking at the circumstances of the transaction in question, we see that the parties were in business at Eleva as the firm of Gilbert & Ilallenger; that they had firm property there, and as such were indebted to divers persons in divers sums of money, which they were unable to pay; and that all -the circumstances, at the time the instrument was-made, point to a necessity for a firm assignment and none-other. Further, it appears that the deed describes the parties as of the firm of Gilbert & Ilallenger; that there was no occasion for the use of the firm name as mere descriptio> personas; that the only occasion, for its use was to show the-character of the assignment itself; that the indebtedness, which the parties were not able to pay was described by words appropriate to a joint indebtedness; that the. property assigned was described bjr words appropriate to joint, property; that the list of creditors to be filed was referred to as "those for whom the assignment was made," and the-inventory to be filed was referred to as particularly describing the property assigned; that the list of creditors and inventory were filed and became, to all intents and purposes,, a part of the deed; that they show- only firm creditors and: firm property; that the language of the bond filed with the-deed was appropriate to an assignment by the firm of Gilbert & ITallenger; and that the affidavit as to the nominal value of the assets assigned, upon which the bond was based,, referred only to firm property. It would seem that we are-hardly required, in view of the foregoing, to resort to very liberal rules of construction, to the end that the assignment be upheld rather than that it fail, and in order to reach the-conclusion that a firm assignment was intended and none other. All of the circumstances and the wording of the-papers point so clearly to the purpose of the parties to make a firm assignment, and that only, as to really leave little-doubt, if any, on the question. Any other construction could hardly be reached without doing violence to the language used by the parties, when viewed in the light of the-res gestee. The language of the deed, in many particulars, in fact in all essentials, is much like that in McNair v. Rewey, 62 Vis. 167, where this court held that it was a firm assignment, and clearly so. But looking at the instrument, independent of precedents, and testing it by the well established rules of construction to which we have referred, the-decision of the trial court was clearly right. In Williams v. Hadley, 21 Kan. 350, and Von Wettberg v. Carson, 44 Conn. 287, confidently cited by appellant, the construction given was in aid of the assignments. If the circumstances bad been reversed, so that such a construction would have defeated the assignments, especially in the face of a manifest legislative policy to favor such dispositions of property by the voluntary acts of insolvents, whether the same results would have been reached is by no means certain. The cases are not considered in conflict with the decision of this case.
By the Court.— The judgment of the circuit court is affirmed.