Court Opinion

ID: 8056596
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:33:12.20342+00
Date Added: 2024-06-11T16:37:48.687960
License: Public Domain

By the Court.
John R. VanLieu, having become insolvent, made in January, 1829, an assignment of his property for *346the benefit of his creditors, according to the act passed on the 23d day of February, 1820, Rev. Laws 674: He, with three other persons, two of whom are since dead, became in the year 1820, the executors of Frederick VanLieu; who, by his will, gave his wife the interest of four thousand dollars, to be paid annually by her executors, during her life, and the principal, after her decease, to be divided among her four children, of whom John was one, and the other executors were the husbands of the rest. Soon after proving the will, the executors agreed to take, and did divide among them, the sum of four thousand dollars, of the bonds and other personal securities of the testator, each receiving the sum of one thousand dollars, and agreeing to pay yearly, to the widow, the interest on the amount so respectively received. A settlement pf the estate, in the Orphans’ Court, has been since made by Daniel H. Disborough and John R. VanLieu, the surviving executors. The amount of one thousand dollars received by John R. VanLieu, consisted of bonds and other personal securities, given to Frederick Van . Lieu, in his life time ; upon which he received the money before he made the assignment, and “ the money so received had been mixed up and with” his other property. The plaintiffs now before us are his assignees; to whom claims to a large amount were exhibited by his creditors. And, among others, Daniel H. Disborough, as executor, and Ann VanLieu, as widow of Frederick VanLieu, claimed the above'mentioned one thousand dollars, and the interest in arrear. The Court of Common Pleas of the county of Somerset made an order, that the assignees “ set apart from his property the sum of one. thousand dollars, to meet the interest payable hereafter to the widow, Ann Van Lieu, and that the said assignees do pay, to the- said Ann Van Lieu, the interest now due her on the said one thousand dollars, without abatement or deduction.” Of this order the assignees now complain.
The order,we présume, is founded on the principle, that John R. VanLieu, as to the widow, and the sum of one thousand dollars, stood in the character of a trustee, and that the cestui que trust, and the trust fund, ought to be preferred to the general creditors
The question presented by a case of this kind is, whether the fund remains in such a state, that it can be taken and specifi*347cally appropriated to the object of the trust, or whether it has been so blended with the insolvent’s estate, that it cannot be known and distinguished. When the property has been converted into cash by the insolvent, and absorbed in the general mass of his estate, so that it cannot be followed or distinguished, a cestui que trust stands on the same footing with other creditors. Thus, in Ex parte, Ellis, 1 Atk. 101, the Lord Chancellor appointed a receiver of the effects of the testator unreceived by Winsmore, the bankrupt executor, and ordered the assignee to deliver to the receiver such parts of the testator’s effects, as should be found to have been received by Winsmore, or to be in his hands, in specie. In Ex parte Dumas, in the matter of Jullian, a bankrupt, the petitioners, Dumas and company, had remitted to the bankrupt bills of exchange for a particular purpose, some of which he had negociated, and others remained in his hands, the Lord Chancellor said, “ suppose the petitioners had consigned over goods to Jullian, as their factor, and he had sold them and turned them into money, the principal then could only have come in as a general creditor under the commission, but if the goods had continued in specie, and had been found in Jullian’s hands at the time of his bankruptcy, it would have been otherwise, and has been so determined in several cases ” — and he ordered the specific bills remaining undiscounted, to be delivered up to the petitioners. 1 Atk. 232. In Howard, widow, and another, executors, v. Jemmet, executor, 3 Burr. 1369, Lord Mansfield said, “ if an executor becomes bankrupt, the commissioners cannot seize the specific effects of his testator, not even in money, which specifically can be distinguished and ascertained to belong to such testator, and not to the bankrupt himself.” In Tooke v. Hollingsworth, 5 D. and E. 226, Lord Kenyon said, “ If goods be sent to a factor to be disposed of, who after-wards becomes a bankrupt, and the goods remain distinguishable from the general mass of his property, the principal may recover the goods in specie, and is not driven to the necessity of proving his debt under the commission of bankrupt; — nay, if the goods be sold and reduced to money, provided that money be in separate bags, and distinguishable from the factor's other property, the law is the same.” And the court held that the plaintiff was entitled to recover from the defendants, who were *348the assignees of a bankrupt, certain property “ remaining in specie, not blended with the other effects of the bankrupt, and not having answered the particular purpose for which it was sent.”
In the present case, the bonds of the testator had been converted into money, which was mixed up with the other property of ■ the insolvent, before the assignment — did not remain in specie— could not be specifically distinguished.and ascertained to belong to the testator — did not remain distinguishable from the general mass of the insolvent’s property, and was blended with his other effects. The order of the Court of Common Pleas was improperly made.
In setting aside the order, we wish to be clearly understood as intimating no opinion, where the loss, if there is to be one, must fall, whether on the surviving executor, the widow, or the estate.*
Let the. order be quashed.

 Note. The above opinion was drawn up by the date Chief Justice Ewihg, and was ' adopted and pronounced by his associates, as-the opinion of the court.