Court Opinion

ID: 6610251
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:17:31.488752+00
Date Added: 2024-06-11T15:58:19.739841
License: Public Domain

Opinion of the Court by

Tompkins, Judge.

Thomas, the appellant, sued the appellees in the circuit court, and the judgment of that coúrt being rendered against him, he appeals to this court.
The plaintiff in this action sought to recover against the defendants for seizing, and selling and converting to their own use, certain personal property as belonging to E. Whiting & co., which had been assigned to the plaintiff, as he contended, under trusts declared in the deed of assignment
The deed purported to convey the property to Thomas' the plaintiff, in trust to sell it and pay debts of the company’ Of those debts some were preferred, viz: debts due to Reuben Watts and John Wilson of Fayette, and to one Charles Brown of Boston. After paying those debts it was provided, that all just debts at that time due and owing by the firm, were to be paid, and the trustee was to hold the residue for the benefit of the company. All the property, both real and personal belonging to this firm was conveyed by this deed for the purposes above mentioned. The firm consisted of said Whiting and one Williams, residing in Boston, Whiting had been the acting partner in Missouri. The deed had been made by the direction of Williams, and he afterwards assented to and ratified it in writing. The goods in question were, in pursuance of this deed, delivered over to Thomas as the plaintiff in the circuit court and appellant here. The appellees were, except Reynolds, judgment creditors of Whitng & Co., and their judgments were obtained before the transfer by Whiting to Thomas, and the seizure was made under the authority of executions issued on those judgments, Reynolds was the officer who levied on the goods.
Upon this evidence the court, on motion of the defendants instructed the jury that the plaintiff could not recover. The plaintiff then took a non-suit with leave to move to set the same aside. The circuit court overruled his motion for that purpose; and he excepted to the decision of the court. The appellees contend that the deed being made by Whiting a-*464l°ne is void, and that the defect is not cured by the subsequent assent of the other partner, Williams.
There have been several decisions on the subject of this °f assignments. In the cases hitherto decided the court has restricted itself to the decision of such points only as it became necessary to decide, organised as this court is, it frequently becomes very difficult, indeed impossible to have all its decisions on one subject under its view, so as to be enabled to review them. The decisions of most importance were made at St. Louis in May last, and they are not to be obtained here. I shall proceed then to give my opinion on this case without reference to any thing before decided, nor indeed do I esteem it of any great importance that the former opinions are not reviewed; for the judgment of the circuit court will be affirmed by a division of this court, it consisting at this time of two judges only. It is not, in my opinion, at all necessary that Whiting should convey the propesty to Thomas by deed, that is, the property which the appellees are charged with seizing &c.
He had transferred it by the direction of his partner Williams, and against any claim on his part the transfer to Thomas was, in my opinion, valid. But as against such creditors as did not choose to acquiesce, the transfer was in my opinion void, however correct the instructions of Whiting and Co., may have been.
It was, in my oj inion, void as against creditors because it is against the policy of the law. Whiting and company, had they been willing to do equal justice to all their creditors, might have applied under the provisions of the act for the relief of insolvent debtors, and the circuit court, or a judge thereof in vacation, would by that law have had authority to appoint a trustee for the benefit of the creditors. But he lives a number of years probably in our country, has the aid and protection of the institutions of the State, has probably collected many debts from the citizens by the aid of the courts of justice, and when he becomes unable or unwilling to pay his own debts, the laws of the country are found to impose restrictions too onerous for him to bear.
Instead of leaving the choice of a trustee to the impartial *465tribunal provided by law, he, the person interested to cheat his creditors, selects'a trustee to suit his own purposes. He maybe honest in his selection, and his creditors may have| no confidence in his integrity. Even if they believe him honest they may believe him unwise in his choice. His trustee may be neither delinquent, nor honest, yet he is to decide on the validity of the claims of the several ci editors, and is neither chosen by the creditors, nor accountable to them. We may be told that a debtor may pay one creditor in preference to another. Be it so. But when the debtor transfers his property to a trustee to raise money to pay a preferred creditor, this is not passing the property over to the creditor in satisfaction of his demand. The effect of the act, if it be valid, is to withdraw so much property from the liability of being seized under legal process to satisfy debts, already ascertained by the judgments of our courts, for the purpose of subjecting it to the payment of such demands as this trustee, chosen by the debtor may decide to be due from the debtor to the creditor. The worst of the matter is that the debtor himself declares who are his own creditors and in what order they shall have their judgments entered up, and satisfied in this court of his own creation. The common law and her younger sister the Statute law smile on the diligent, not on the sluggard. Whiting and Company have some friends among their creditors whose diligence is not so great as that of some others. They erect a court of their own, and appoint their steward to this high court; they declare by their own law, that to this court all their creditors shall resort; and in contravnetion of the general law of the land, that three favored creditors shall be first served, although the other creditors may appear first in order of time. Under their superintendence both as Judge and jury, the steward ascertains the amount of each creditors demand. Indeed the firm of Whiting & Co., is witness as well as Judge and jury.
It appears in the bill of exceptions that the assignee visited St. Louis soon after he had been appointed and possessed of the property, where he entered into an agreement *466with about thirty of the creditors to discharge his duty faithfully &c. and they on their parts agreed with him to allow the other creditors to come within four months and participate in the assigned property, they executing receipts in full, and in fact releases, if we may suppose that such people know what is a release. That however is the plain import of the language used. On account of a provision of this kind inserted in a deed of assignment which was the subject matter of adjudication, at the last term of this court held at St. Louis, the deed was declared void, if I am not greatly mistaken. In my opinion it is altogether immaterial whether such a provision be incorporated in the deed or whether the trustee make that provision his rule of conduct. For even without that provision, I thought then, as I do now, that the deed ought to be declared null and void.
When the learned counsel in the course of his argument declared that the conduct of his client was so warmly approved by the creditors residing at St. Louis, I had supposed that he was volunteering evidence by way of argument to prepossess the court in favor of his clients, 1 did not suppose his client would have been so ill advised as to spread such matter on the record. But to do the counsel justice he was too judicious to read it to the court, and I suppose hoped it would escape observation amidst the mass .of irrelevant matter that swelled the record to unusual size. It is my opinion long entertained and deliberately made up, that if the courts of law tolerate the practice of suffering the property of debtors to be withdrawn by means of deeds of this kind from the reach of legal process, they will be alike faithless to the law and the constitution. It is in vain that an equality of rights forms the basis of all our laws, if persons who choose to declare themselves to be in failing circumstances, ar,e allowed to be exempt from any liability to have their .property sold by judgment creditors under legal process merely because those debtors declare that they wish to lock up such property for the benefit of their particular friends. The judgment .of the circuit court ought, in my opinion, to be affirmed.