Court Opinion

ID: 6229492
Source: CourtListenerOpinion
Date Created: 2022-02-17 20:18:38.338368+00
Date Added: 2024-06-11T08:57:48.325791
License: Public Domain

The opinion of the Court was delivered, September 15, by
Lewis, J.
Whenever a trust-fund has been wrongfully converted into another species of property, if its identity can be traced, it will be held, in its new form, liable to the rights of the cestui que trust. No change of its state and form can divest it of such trust. So long as it can be identified either as the original property of the cestui que trust, or as the product of it, equity will follow it; and the right of reclamation attaches to it until detached by the superior equity of a bond fide purchaser, for a valuable consideration, without notice. The substitute for the original thing follows the nature of the thing itself so long as it can.be ascertained to be such. But the right of pursuing it fails when the means of ascertainment fail. This is always the case when the subject-matter is turned into money and mixed and confounded in a general mass of property of the same description: Story’s Equity, sec. 1257, 1258, 1259. This mixture has taken' place in the case under consideration. It is impossible for a chancellor to lay his hand upon a single article of property or on a single dollar of money included in the assignment, and say that any particular thing or sum of money is either the original property of Seth Matthews’ heirs or the product of it. The decree below was therefore erroneous.
Decree reversed, and decreed that the funds in the hands of the assignee be distributed pro rata among all the creditors of the assignor. Record remitted.