Court Opinion

ID: 4925939
Source: CourtListenerOpinion
Date Created: 2021-09-24 00:56:45.731974+00
Date Added: 2024-06-11T08:14:20.275927
License: Public Domain

Weston J.
delivered the opinion of the Court at the ensuing term in Cumberland.
The first question presented in the disclosure of Isaac Emery is, whether, before the service of the trustee process upon him, there had been any assignment to Isaac Mams, of the debt due from him to the principal defendants. An order was enclosed to him from the defendants, in a letter dated May twenty third, 1826, for twenty five hundred dollars, in favor of Isaac Mams, and requesting him to accept the order, and to hold it for the said Isaac; or until he should hear from them again. This order, Emery says, he accepted on the day he received.it, which was the twenty fifth of May. On the ' twenty third of the same month, he says he was indebted to the defendants in the sum of twenty five hundred dollars; but that they had, at the same time, merchandize of his consigned to them to the amount of one thousand dollars. From, the whole disclosure it is to be inferred that his acceptance for the whole amount, was upon the *251condition that these goods should be returned to him, or should be subject to his order. Upon being interrogated whether the defendants, in their letters of the twenty third, or thirtieth of May, or either of them, informed him that his goods to the amount of a thousand dollars should be delivered as he should direct, if he accepted the order, he replies generally that they did, if he would forward it to Isaac Adams. He does not designate which of these letters contained this proposition, but as the letter received on the, thirtieth contained a different one, we may fairly understand that it was contained in the letter of the twenty third. But as Emery did not comply with this proposition, it may be presumed that he was unwilling to do so, until assured of his goods. Prior to the thirtieth, he had directed these goods to be delivered to the Messrs. Motley, which the assignees of the defendants had declined to do, unless the order was accepted. By the letter received on the thirtieth, he was directed to deliver the order to Deshon, as tire condition upon which he was to receive his goods. The twenty five hundred dollars were advanced by the defendants to Emery, on goods sent, and to be sent, by him to them, to be sold in the usual course of transacting commission business for their reinbursement. He was deficient only fifteen hundred dollars in the amount of goods forwarded, and he was therefore under no obligation to answer the defendants’ order for twenty-five hundred dollars, until his goods were restored. Taking the whole disclosure together, the negotiation was kept open between them, in regard to this condition, until Emery was served with process in this action. Upon this ground therefore, the assignment to Isaac Adams does not appear at that time to have been complete and effectual. Still less does it appear that any assignment was made to him for his own use and benefit, or upon any valuable consideration paid by him. His appearance was merely nominal. Nothing was done by his personal agency. Emery held no communication with him. This course may have been taken by the defendants, merely to deposit funds in his hands, subject to their order. They manage the business throughout; and finally direct the order to be placed in the hands of Deshon. That the defendants, notwithstanding the order in favor of Isaac Adams of the twenty third of May. still considered *252tbe debt as due from Emery to them, is apparent from the fact that in their assignment of the twenty fifth of the same month to Ellery and . others, a copy of which is made part of Emery's disclosure, the debt due from him is specifically included. If Isaac Adamshad been the holder of the order, and the acceptance had been complete, prior to the service of this process, the defendants could not have done any thing to prejudice his rights. But he does not appear ever to have been the holder of the order; nor does it sufficiently appear that the acceptance had then become effectual.
A question of more importance remains in the .case, and one equally applicable to both the trustees; whether they ought to be discharged by reason of the assignment to Ellery and others, of the twenty fifth of May. It is objected that the assignment ought not to have operation until the second day of June, after the service of the trustee process, because on that day, custom house bonds, to the amount of nearly one hundred thousand dollars, were provided for out of the property assigned. If the assignment of the twenty fifth of May were liable to no legal objection, it might remain good, and from that date, notwithstanding the provision subsequently made for the custom house bonds, by the assent of all the parties to the instrument.
It is further objected that the' assignment contains conditions, which the defendants had no right to impose upon their creditors, and that it is therefore void in respect to such as have not expressed their assent, by becoming parties thereto. Those conditions are, that the creditors should accept the provision made for them in full of their respective demands, and should thereupon release the defendants therefrom ; and that no creditors were to have the benefit of the property assigned, who did not' become parties to the instrument within seventy days. With regard to’ the condition requiring a release, Story J. in the case of Halcey v. Fairbanks, upon a full consideration of the authorities, deduces that they support the validity and legality of such a stipulation, although he declares, that if the question were entirely new, the inclination of his mind would be strongly against it. In that case the same learned judge states that the time limited for creditors to become parties to the instrument, maybe so short or so long,, as-to justify a presumption of fraud, *253whibh would defeat its operation. There can be no doubt of the soundness of this opinion. The law requires in all transactions the most perfect good faith. If therefore an instrument, purporting to be made for the benefit of all the creditors of the party making the assignment, does not allow them a reasonable and sufficient time to avail themselves of its provisions, its apparent fairness is merely specious and delusive. So also it is liable to objection, if the time be unreasonably extended, and the adjustment of the business, and the-claims of the creditors, thereby unnecessarily delayed. From the property assigned, and the debts and credits of the defendants, detailed in the schedules attached to the assignment, it appears that their business was much extended, and that they were engaged in foreign commerce. They had many creditors, and were indebted in an amount approaching four hundred thousand dollars. The residence of their creditors does not appear ; but we know they were not confined to their own State; and as they were numerous, and the dealings of their house extensive, it would take some time to notify them, and to afford a fair opportunity to all, who chose to do so, to come into the arrangement. It is difficult to account for the fact that so small a proportion in number and amount executed an instrument apparently equitable, and which proffered advantages only to such as thus expressed their assent, if the creditors generally had notice within the period limited, and a reasonable time to make proper inquiries into the state and condition of the concerns of the defendants. Under these circumstances, we are strongly inclined to the opinion that the shortness of the time constitutes a sufficient objection to the validity of the assignment against such creditors, as have not expressly assented thereto; but we do not place the decision of the cause upon this point; but upon the ground that a general assignment made by an insolvent debtor in another jurisdiction, shall not be permitted to operate upon property in this State, so as to defeat the attachment of a creditor residing here.
In foreign administrations, to which proceedings here are made ancillary, funds thus collected within this jurisdiction are held subject, to the claims of our own citizens, to whom payment is to be made *254in full or in part, according to circumstances. 3. Pick. 128, and the cases there cited.
In the case of Le Chevalier v. Lynch & al. Doug. 170, the assignees of a bankrupt were not permitted to defeat a process! of for» eign attachment made after the bankruptcy ; although the policy of the bankrupt system is much favored in England, and the attachment was made in a colonial jurisdiction.. The bankrupt law of a foreign country does not legally operate to transfer property in the United States. 5. Cranch 289.
Nor can property in this State be put out of the reach of creditors here, by the insolvent laws of another State. Comity between States is not thus to be extended, to the prejudice of our own citizens. The case of Ingraham v. Geyer, 13. Mass. 146. cannot be distinguished in principle from the one before us. There, an assignment made in Pennsylvania, resembling the one in question, except that four months instead of seventy days, were allowed to creditors to accede to its provisions on their part, was not permitted to defeat a foreign attachment made in Massachusetts, by a creditor resident there; although the trustee had notice of the assignment, and set it forth in his disclosure. , Trustees charged.