Court Opinion

ID: 8057916
Source: CourtListenerOpinion
Date Created: 2022-09-09 04:34:50.286792+00
Date Added: 2024-06-11T16:37:55.906124
License: Public Domain

Elmer, J.
I concur in affirming the judgment. It was held in the case of Varnum v. Camp, 1 Green 326, that an assignment which on its face prefers a creditor is prohibited by our statute, and is therefore invalid. Adopting, also, the opinion of the Supreme Court of Massachusetts, in the case of Perry v. Holden, 22 Pick. 269, that a mortgage and a deed of assignment may be so connected as to be considered one act, and therefore within the prohibition of the statute and void, I am of opinion that this case is not of that character. In the cases of Fairbanks v. Haynes, 23 Pick. 323; Housatonic Bank v. Martin, 1 Metc. 294; Rundlett v. Dole, 10 N. Hamp. 458; and Bates v. Coe, 10 Conn. 280, it was held that prior mortgages given to secure preferences did not render a subsequent assignment void.
But I am not prepared to concur with the intimation of the Chief Justice in Varnum v. Camp, which seems to be adopted by my brethren now, “ that the express denial of preferences, is in truth but an amplification of the antecedent clause of the statute, and without really adding anything to its extent, or perhaps to its force, serves to express in distinct terms the legal effect and operation of the prior clause.” It is an important rule of construction, that every part of a statute shall have due effect. In my *443judgment, the first clause of the first section requires every assignment to bn made for the equal benefit of creditors, and thereby prohibits one which undertakes to provide for ¡¡references. But the next clause goes further. Its language is, “and all ¡¡references of one creditor over the other, or whereby any one or more shall he first paid, or have, a greater proportion, in respect of his, her, or their claim, than another, shall be deemed fraudulent, and void, excepting mortgage and judgment creditors, when the judgment !¡as uot been by confession for the purpose of preferring creditors.” Certainly these words are broad enough to include any preference not provided for in the assignment itself, but made in contemplation of such an act. The exception in favor of mortgage and judgment creditors, by a necessary implication, saves the lien thereby created in the case of a mortgage expressly given to secure a preference, prohibiting only a judgment confessed for that object, and, as it seems to me, shows that the preferences prohibited ineludo such as are not referred to in the assignment itself. Mortgages, for whatever purpose given, arc left to stand unaffected by the act, while judgments confessed for the purpose of preferring creditors entitled to claim under the assignment are prohibited. To give effect to this exception, the assignment must stand, and the preference only is destroyed. The, other construction rejects the phrase, “when the judgment has not been confessed for the purpose of preferring creditors.” The reference is to a judgment confessed for the purpose of preferring creditors provided for in an assignment, which to be valid must provide for all. If such a judgment Is preferred in the assignment itself, that is void, and the judgment, will stand unaffected. But if the assignment is good, the judgment confessed to procure a preference must be avoided, or otherwise such a judgment is left in the same situation as a mortgage, contrary to the plain language and intent, of the statute. What was said on this question in Yarn urn v. Camp, and repeated in *444Vanderveer v. Conover, 1 Harr. 490, wás only by way of argument, the point not being involved in either of those cases.
Under what circumstances and by what course of proceeding preferences created by a debtor about to make an assignment may be avoided, it is not necessary now to settle, that question not being before us. I cannot doubt that such preferences. are voidable upon general principles, as well as by the plain terms of the statute, and I see no difficulty in applying the rule of the English courts in cases of bankruptcy, that such preferences are invalid as have been given voluntarily, without pressure from the creditor, and with the view of giving a fraudulent preference, in contemplation of an assignment. Burrill on Asst. 100, and oases in note.
Cited in Fairchild v. Hunt, 1 McCar. 371; National Bank of the Metropolis v. Sprague, 5 C. E. Gr. 28