Court Opinion

ID: 5471482
Source: CourtListenerOpinion
Date Created: 2022-01-09 20:39:23.272145+00
Date Added: 2024-06-11T08:33:19.989388
License: Public Domain

Daniels, J.
The action has been brought to secure the priority of the plaintiffs’ rights under attachments issued against the defendant, Samuel Plonsky, over an assignment executed by him for the benefit of creditors, and over executions issued upon judgments confessed by him in favor of others of the defendants. The attachments issued on behalf of and for the plaintiffs were levied upon the stock in trade of boots, shoes and fixtures of the debtors, and the executions *233upon the confessed judgments were also levied upon the same property. These judgments, as well as the general assignments, are alleged to have been made and entered with the intent to hinder, delay or defraud the creditors of the debtor. And for that reason the plaintiffs claim priority over the general assignee, and the creditors in the judgments confessed, although their attachments were afterwards, in point of time, levied upon the property; whether such an action can be maintained by them, under the circumstances, is the point upon which the appeal has been placed in the argument. It is entirely clear that no such suit could be maintained for the vindication and establishment of the rights of the attachment-creditors, if the property seized under the attachments had not been of a tangible nature (Smith agt. Longmire, 24 Hun, 257). This disability results from the circumstance that such property, after having been assigned or transferred, even though that may have been done fraudulently, cannot be made subject to an attachment as long as such transfer remains in- force. But, where the property is not of that character, but is capable of being taken into the manual possession of the sheriff, there this difficulty does not exist. Notwithstanding the fraudulent transfer, such property may still be seized by virtue of the attachment. And the propriety of the seizure may be sustained when that is brought in question by showing that the transfer itself was fraudulent and inoperative as against creditors. This right to assail such a disposition of the debtor’s property results from the fact that the creditor is entitled to have it seized by virtue of his attachment, and after that to maintain the propriety of such a seizure of it. The Code has provided that the levy may be made upon property capable of manual delivery by taking the same into the sheriff’s actual custody (Code Civ. Pro., sec. 645, subd. 2). This provision is so general in its character as to include no exception; and consequently property, the title to which may have been fraudulently transferred, may be made the subject of the seizure the same as though it *234remained in the debtor. To render such a seizure entirely ' effectual, the creditor may show in vindication of it, that while the title to the property had been, in form, transferred, that it was done to defraud creditors, and in that manner avoid and annul it (Thurber agt. Blanck, 50 N. Y., 80; Frost agt. Mott, 34 id., 253). This case has been brought within this principle, for the complaint shows an actual attachment of the property, and that it was all property which could be taken into the manual possession of the officer. Upon the basis of the lien created in that manner no good reason seems to stand in the way of an action of this nature, brought to re-establish the right of the attaching creditors to appropriate it through the instrumentality of the attachments, to the payment of any judgments they may recover in the action; and that really is all that is intended to be accomplished by the present suit. The injunction extends no further than to protect the creditors’ rights during the pendency of the action in case they shall ultimately appear to be entitled to this relief. For it simply, in the- meantime, restrains the payment of any of the proceeds of the property of the debtor to the defendants or either of them upon the executions issued to collect the judgments confessed by the debtor, and it included only the property seized by virtue of the plaintiffs’ attachments. Even this restraint is more formal than real, for the reason that the direction given to the sheriff requiring him to deposit with the chamberlain the amount, of such proceeds, subject to the final determination of this action, would practically accomplish the same result. And such an order as that would, very much as a matter of course, have -been made upon a motion, where a contest of this nature existed as to the proceeds between the several parties proceeding against the property. The appeal taken from the order cannot be sustained, but it should be affirmed, with ten ten dollars costs, besides the disbursements.