Court Opinion

ID: 8009864
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:56:58.72328+00
Date Added: 2024-06-11T16:36:01.880077
License: Public Domain

Barclay, J.
No question is raised by any of the parties concerning the regularity of the proceedings by which the issues in the trial court were reached. There is, therefore, no need to discuss that subject further than to remark, as bearing on some of the questions we must consider, that the parties who intervened and became volunteer defendants in the suit were merely general creditors of Enoch J. Jacobi. They were admitted to defend at the instance of the assignee, Mr. Retti, by whom their claims against Enoch J. had been allowed as demands against the assigned estate. Their joint answer sought to have the court adjudge the plaintiffs mortgage fraudulent as to creditors, and that the proceeds of the goods mentioned in it should become a part of the assigned estate for distribution and application pro rata upon their allowed. claims after payment of the costs of the assignment.
The material facts on which the case turns are mutually conceded. The interpleading creditors admit the identity of the stock of goods (which the assignee took possession of under the deed of assignment) with that mortgaged, but assert the invalidity of the mortgage as fraudulent. The claim 'is not that it was-invalid as between the original parties but that, as to creditors, it comes within the denunciation of the statute as a conveyance to the use of the mortgagor, either in law, by reason of its terms, or, at least, in fact by virtue of the acts and understanding of the parties to it.
*512But, unfortunately for this contention, the intervening creditors do not occupy such a position in the present controversy as permits them to take advantage of the claim they thus make, even were it fully established by the proof, as to which we have no occasion to express an opinion. None of them has attempted to assert a hostile right against the goods, or their proceeds, by virtue of any attachment or general judgment against the property or against the debtor. They have merely proved their several claims before the assignee, and obtained allowances against the assigned estate. They have intervened in this suit to make a defense on behalf of the assignee’s interest in the property. The only status they have before the court is under and by reason of the assignment of the alleged fraudulent debtor.
It is now too well settled to require serious discussion that, as against a voluntary assignee for the benefit of creditors, a chattel mortgage of the debtor is valid even though the facts and circumstances bearing on it may be such as render it vulnerable to attack by creditors asserting their rights independently of the assignment. This rule rests upon general principles governing the law of assignments.
A statutory assignee in trust for creditors is not regarded as a purchaser for value. Tie acquires the right and interests of the assignor in the subject-matter of the assignment but none greater. Under our law he cannot annul prior dealings of his assignor respecting the assigned property which the assignor himself might not.
A chattel mortgage to the use of the mortgagor is valid as against the latter and hence against his voluntary assignee in trust for creditors.
There is nothing exceptional suggested in this case to take it out of these general rules.
The assignee in the present instance received the stqck of goods mentioned subject to the mortgage. The *513only estate therein which he took for distribution among the creditors was the surplus that might remain after satisfaction of the debt secured. The assigned estate never acquired any interest adverse to the mortgage on the facts here exhibited.'
It follows that, whatever view may be taken of the latter instrument, the assignee and those who have been admitted to defend in his right on behalf of the assigned estate are not in a situation to successfully assail it in this proceeding on the grounds they urge.
II. The next point pressed upon our notice is that the plaintiff is “ estopped from claiming under both mortgage and assignment,” it being conceded that plaintiff’s demand (secured by the mortgage) has been, at his instance, allowed by the assignee as a claim against the assigned estate.
We do not discern any such estoppel in the facts of this case. The evidence shows that the property assigned not only embraced the debtor’s interest in the goods covered by the mortgage, but also his ‘ ‘ accounts, choses in action and other personal property.” Furthermore, in his petition for an allowance by the assignee, the plaintiff expressly asserted precedence for his claim secured by the mortgage as against the goods embraced within its terms. He had already brought the present suit to foreclose. The facts recited show no purpose or intent on his part to waive his rights under the mortgage or to elect any remedy inconsistent with the assertion thereof.
Of course he could have but one satisfaction of his demand in any event. But if the mortgaged property did not satisfy the debt his allowance in the assignment would enable him to participate for the residue with the other creditors in the ‘proceeds of the remaining property assigned. There is no rule of law to prevent his so participating.
*514Finding the result reached by the trial court correct upon the undisputed facts, it is unnecessary to review the details of exceptions in the. course of the proceedings. The judgment was for the right party. We all agree to affirm it.