General Principles.

deed, as well as from extrinsic circumstances, | a debt due to the assignor by the complainant. such an event was contemplated. Money act- The complainant filed a bill against the assignees, ually advanced upon the credit of such an as- claiming as a set-off against a debt assigned to signment, subsequent to its date, might, perhaps, them, the amount of a judgment obtained by be secured by it. Such an assignment is of no him against the assignor after the assignment. other validity, the banking law then being in By the court-If, subsequent to the assignment force. Harrison v. Sterry et al., 5 Cranch, 289; being made, and before notice of it, any counter 2 Cond. Rep. 264. claims be acquired by a debtor to the assignor, these claims may, unquestionably, be sustained. But if they be acquired after notice, equity will not sustain them. If it were even true, that they might have been offered in evidence in a suit at law brought in the name of the assignor; he who neglected to avail himself of that advan tage, cannot, after judgment, avail himself of such discount as plaintiff in equity. Brashear v. West, 7 Peters, 608.

General Principles.

31. An assignment was made by a debtor, for | the debtor's property. A small portion left out the benefit of his creditors, to two attorneys at by mistake or fraud, will not defeat the priority law, who were partners in their business, as of the United States. Ibid. trustees; one of them assented to the assignment at the time, the other being absent. It was held, that the latter must be presumed to assent also, unless upon notice he refused to accept the trust, and notified it to the debtor; and especially if he and his partner proceeded to act under the assignment by a private conditional agreement between them, as to giving a priority to certain attachments made by them in favour of certain creditors, which agreement was unknown to the debtor. And it seems, that even if under such circumstances the priority could be held valid, the assignment would be an operative trust as to all other assenting creditors. Gordon v. Coolidge, 1 Sumner's C. C. R. 537.

40. An assignment of all the debtor's property in a schedule referred to, which enumerates only specific property, and does not purport to be all, affords no presumption that it is all the debtor's property, or a general assignment. Ibid. 41. The trustee process lies against assignees in favour of the United States, where a debtor makes an assignment of his property in trust to pay custom-house bonds, or other debts due to the United States, to attach the funds to the amount of such trust in the hands of the assignees; notwithstanding, at law, the assignment passed the property clothed with the trust to the assignees. Ibid.

42. One of the trusts of an assignment was, to pay eight thousand four hundred dollars on custom-house bonds, on which M. was surety. M. being one of the assignees, he was surety on bonds to a less amount; but the debtor, in fact, owed bonds to the custom-house to the amount of eight thousand two hundred and fifty-seven dollars; it was held that no bonds were included in the trust, but those on which M. was surety. Ibid.

33. Where an assignment is made by two persons, one of whom accepts the trust, and the other repudiates it, the assignment is operative 43. Query, Whether parol evidence is admisas to the assenting trustee; unless there is some sible to explain the intent of the parties to such condition in it that it shall be void, unless assent-an assignment, so as to show whether all bonds ed to by both trustees. Ibid. were intended to be included, or those only on which M. was surety. Ibid.

34. If the declaration upon an assignment of a patent-right, omit to state that the assignment has been duly recorded in the office of the secretary of state, the defect is cured by a verdict for the plaintiff. Dobson v. Campbell, i Sumner's

C. C. R. 319.

35. Query, Whether a party who has procured an assignment of a debt of the plaintiff, can set it off against his own debt due to the plaintiff, which was previously assigned. Green v. Darling, 5 Mason's C. C. R. 202.

36. Where the assignee of an insolvent debtor recovers a demand, and expenses are incurred thereby, the latter are a charge on the fund, and the right of priority of payment of the United States attaches on the residue. The United States are not bound to contribute, pro rata, for the sum due to them. U. S. v. Hunter, 5 Mason's C. C. R. 229.

37. An assignment of prize property is good at common law; and after condemnation, the title becomes, by a retroactive operation, perfect in the assignee. The Sally and Cargo, 1 Gallis. C. C. R. 409.

38. Under the trustee process of Massachusetts, by statute of 1794, ch. 65, if the trustee swears he has no goods, effects, or credits of the debtor in his hands, he is entitled to be discharged, unless, from other parts of his disclosure, that averment is overthrown. U. S. v. Langton, 5 Mason's C. C. R. 289.

39. Where an assignment does not, on its face, purport to be of all the debtor's property, it is incumbent on the United States, if they insist on a priority of payment under the act of congress of 1799, United States' Statutes at Large, vol. 1, 627, to establish that it does, in fact, contain all

44. Where there is a general assignment of a debtor's property for the benefit of creditors, and the priority of the United States attaches, they having various debts due by bonds, with different sureties; all payments made by the assignees are to be applied, pro rata, to all the debts of the United States; and the latter are not at liberty to apply the payments in any other manner, without the consent of all the parties in interest. U. S. v. Amory, 5 Mason's C. C. R. 455.

45. An assignment by a debtor of all his effects for the benefit of such of his creditors a should release their debts in sixty days from the date of the assignment, where there was no fraud, was held to be valid. Pierpoint and Lord v. Graham, 4 Wash. C. C. R. 232.

46. Such an assignment would not be fraudu lent, merely for want of a schedule of the property assigned. Ibid.

47. A debtor who is insolvent may, by an assignment, prefer one creditor to another. Ibid. 48. The offer to release, made by a creditor to the trustee under an assignment for the benefit of such creditors as should release within a particular time, the trustee having undertaken to prepare and have ready a release, and who failed so to do; is not sufficient to entitle the creditor who did not execute the release, to come in under the trust. Ibid.

49. Acceptance of the trust by the trustee, who was also a creditor, will not entitle him to the benefit of the trust, if he has failed to execute the release in time. Ibid.

50. The day on which the assignment was made is to be excluded, where the expression is used only to fix a terminus to compute from. Ibid.

General Principles.

51. If any of the creditors release on the sixtyfirst day, the sixtieth day falling on Sunday, he is too late. He should have released on the sixtieth, or on some prior day. Ibid.

52. Preparing a deed of release before the expiration of the sixty days, is not sufficient, if it was not executed within the limited time.

Ibid.

53. A master of a ship having put into a port in distress, and having no other means, drew a - draft on his consignees, stating it to be for "value received in disbursements and repairs of the vessel." The draft had not the effect of an equitable assignment of the freight, as a draft on a specific fund. U. S. v. Hatch, 1 Paine's C.

C. R. 336.

54. An assignment by deed of partnership debts, which are assignable at law, executed by one partner, although void at law, will be sus tained in equity, if it appear that the assignment was made with the bona fide intention of securing the creditors of the firm. Anderson et al. v. Tomkins, 1 Brockenb. C. C. R. 456.

bankrupt laws of England; and though the equitable rights of the assignees, acquired under those laws, will be respected in our courts; yet the right of action must be regulated by the laws of the forum in which the suit is brought; and the transfer of a bankrupt's effects in England, being an assignment merely by operation of law, and not by the act of the party, is not such an assignment of the legal title to the assignees, as will enable them to maintain an action in their own name, in the courts of Virginia. Blane v. Drummond, 1 Brockenb. C. C. R. 62.

60. A surety on a custom-house bond, who has paid it, has the same priority as the United States, against the estate of his principal in the hands of his assignee. If such surety become insolvent, and the same person is assignee of both estates, the funds of the principal, to the extent of the debt due such surety, as a priority creditor, is, by operation of law, deemed assets of the surety; and if the latter is also in debted to the United States for other debts, the United States may, by a bill in equity against the assignee, insure its priority out of such fund or assets. U.S. v. Hunter, 5 Mason's C. C. R. 62.

55. The book debts of a merchant are not assignable at law; and a deed executed by one of a mercantile firm, purporting to convey such debts, does not pass the legal title. At law, the 61. If under the act of 24th May, 1824, ch. assignment is only a power to collect and appro- 140, sec. 2, the secretary of the treasury omit to priate the debts, which is revocable. So far as retain the amount of debts due to the United the money has been collected, before revocation, States from a person entitled, by an award under the title to the money is in the trustees named the Spanish treaty, to money provided for payin the deed. Such a power to collect, is a con- ment of such award, it does not prejudice the tract which could not be enforced at law, but right of the United States to proceed for the paywill be sustained in equity, and will have pre-ment of such debts against the general assignee, ference to any subsequent assignment by the other partner; as the prior equities must prevail between mere equities. Ibid.

56. An assignment of "all the goods, wares and merchandise, and personal property of every description belonging to the late firm, &c.," does not pass an interest under a contract. Kendel v. Olney, 2 Sumner's C. C. R. 278.

57. A decree in chancery, though not assignable at law, is transferable for a valuable consideration; and a court of chancery will support the transfer. Coates' Executrix v. Muse, Adm'r., 1 Brockenb. C. C. R. 552.

who has received the money from the treasury. U. S. v. Hunter, 5 Mason's C. C. R. 62.

62. To entitle the United States to a priority of payment, under the sixty-fifth section of the collection act of 1799, ch. 128, out of funds in the hands of assignees, there must be a general assignment by the debtor of all his property. A partial assignment of a portion, however large, without fraud, is not sufficient. U. S. v. Munroe, 5 Mason's C. C. R. 572.

63. A., owning certain five per cent. stock of the United States, borrowed one thousand nine hundred and sixty dollars of B., on a note pay58. J. S. executed his bond to T. M. R., who able in three months, and made an assignment assigned it to J.; at the time of assignment, there of the stock, with a power of attorney to transwas a running account between J. S. and T. M. fer it on the books of the bank, and delivered R. The assignee instituted suit against the the certificate of the stock to B., who was to obligor, and some time afterwards, but before sell the stock, if the debt was not paid when judgment, upon a settlement of accounts be-due. A. died before the note became due, intween J. S. and T. M. R., there was found a solvent, and indebted to the United States, who balance due from T. M. R. to J. S., which was claimed a priority of payment. The stock was acknowledged at the foot of the account by T. never transferred on the public books, in A.'s M. R., who promised to pay it three years after lifetime. After his death, his administrator sold the date of the settlement. Held, That this the stock, and applied the proceeds to the payclaim cannot be used as an offset against the ment of B.'s debt. It was held that B. took an bond, against the assignee, either at law or equitable interest in the stock, notwithstanding equity. Scott v. Jones, 1 Brockenb. C. C. R. 244. the act of 1790, ch. 61, had declared that trans59. The assignees of a bankrupt in England, fer should be made only on the books of the cannot maintain an action at law in their own government, by the party in person, or by his names against a debtor of the bankrupt in Vir-attorney; and that the payment by the admiginia, and the action is only maintainable in the nistrator was not a misapplication of the assets. name of the bankrupt himself. Though the U. S. v. Cutts, 1 Sumner's C. C. R. 133. right to personal property may be regulated by the laws of the domicil, as in the case of the

64. An assignment recited in a patent, that the warrant was assigned by the representatives

Assignments by Debtors for the Benefit of Creditors.

of A. B., is not notice to the purchaser that the dered all his property, that in every commercial assignment was made without authority. Scott country known to the court, except our own, the v. Evans, 1 M'Lean, C. C. R. 486. principle is established by law. This certainty

65. As between the heirs at law and the as-furnishes a very imposing argument against its signee of a military warrant, a court of chancery will go behind the patent and investigate the assignment of the warrant, or of the certificate of right, given by the council of Virginia, on which a warrant and afterwards a patent was issued. Ware's Heirs v. Brush, 1 M Lean, C. C. R. 533.

66. An executor having no specific power given in the will, cannot assign a military warrant or a certificate on which a warrant was obtained. And where such an assignment is made by an executor, which appears on the face of the warrant and is copied into the patent, it is notice to the assignee of the warrant, or to the patentee. Ibid.

2. Assignments by Debtors for the Benefit of Creditors.

being denied. The objection is certainly powerful, that it tends to delay creditors. If there be a surplus, the surplus is placed in some degree out of the reach of those who do not sign the release, and thereby entitle themselves under the deed. But the property is not entirely locked up. A court of equity, exercising chancery jurisdiction, will compel the execution of the trust, and decree what may remain to those creditors who have not acceded to the deed. Yet the court are far from being satisfied that, upon general principles, such a deed ought to be sustained. Ibid.

71. Whatever may be the intrinsic weight of objections to such assignments, they seem not struction which the courts of that state have put to have prevailed in Pennsylvania. The conon the Pennsylvania statute of frauds, must be 67. It is not necessary to the validity of a received in the courts of the United States. Ibid. deed of assignment for the benefit of creditors, 72. The assignment transferred to the asthat creditors should be consulted; though the signees a debt due to the assignor by the compropriety of pursuing such a course will gene-plainant. The complainant filed a bill against rally suggest it, when they can be conveniently assembled. But be this as it may, it cannot be necessary that the fact should appear on the face of the deed. Brashear v. West, 7 Peters,

608.

68. That a general assignment of all a man's property is per se fraudulent, has never been alleged in this country. The right to make it results from the absolute ownership which every man claims over that which is his own. Ibid.

69. An assignment was made by Francis West, to certain trustees, of all his property, giving a preference to particular creditors, who were to be paid their claims in full, before any portion of the property assigned was to be divided among his other creditors. By the court: The preference given in this deed to favoured creditors, though liable to abuse, and perhaps to serious objections, is the exercise of a power resulting from the ownership of property, which the law has not yet restrained. It cannot be treated as a fraud. Ibid.

the assignees, claiming to set off against the debt assigned to them, the amount of a judg ment obtained by him against the assignor, after the assignment. By the court: If, subsequent to the assignment being made, and before notice of it, any counter-claims be acquired by a debtor to the assignor, these claims may, unquestionably, be sustained. But if they be acquired after notice, equity will not sustain them. If it were even true, that they might have been offered in evidence in a suit at law brought in the name of the assignor; he who neglected to avail himself of that advantage cannot, after judgment, avail himself of such discount as plaintiff in equity. Ibid.

73. The debtor may prefer one creditor, pay him fully, and exhaust his whole property, leaving nothing for others equally meritorious. Clark et al. v. White, 12 Peters, 178.

74. A debtor may lawfully apply his property to the payment of the debts of such creditors as he may choose to prefer, and he may elect the 70. The assignment excluded from the benefit time when it is to be done, so as to make it of its provisions, all creditors who should not, effectual; and such preference must necessarily within ninety days, execute a release of all operate to the prejudice of creditors not provided claims and demands on the assignor of any na- for, and cannot furnish any evidence of fraudture or kind whatsoever. By the court: This ulent intention. The case of Marbury v. Brooks, stipulation cannot operate to the exemption of 7 Wheat. 556, and 11 Wheat. 78, cited. Tomp-. any portion of a debtor's property from the pay-kins v. Wheeler, 16 Peters, 106.

upon its face, without any condition whatever attached to it, and is for the benefit of the grantees, the presumption of the law is that the grantees accepted the deed. Ibid.

ment of his debts. If a surplus should remain 75. When a deed of assignment is absolute after their extinguishment, that would be rightfully his. Should the fund not be adequate, no part of it is relinquished. The creditor releases his claim only to the future labours of his debtor. If this release were voluntary, it would be un- 76. A debtor made an assignment in 1813, exceptionable. But it is induced by the neces-conditioned that he would pay his debts before sity arising from the certainty of being postponed April 1, 1818, and in the mean time he was to to all those creditors who shall accept the terms, hold the real estate, and take the rents and by giving the release. It is not therefore vo- profits of the same, without account. If within luntary, Humanity and policy both plead so that time the debts were not paid, the assignee, strongly in favour of leaving the product of his on the application of any unpaid creditor, might future labours to the debtor, who has surren-sell the estate. In 1837, the assignee filed a

Assignments by Debtors for the Benefit of Creditors.

bill on the equity side of the circuit court of the tion for a release, or otherwise, the law would, county of Washington, asserting that some of in such a case, presume the assent of the crethe debts were unpaid, and asked the aid of the ditors. Wheeler v. Sumner, 4 Mason's C. C. R. court to make sale of the real estate which had 183. been assigned. The supreme court reversed the decree of the circuit court, which had made a decree for the sale of the real estate. M'Knight v. Taylor, 17 Peters, 197.

77. The delivery of a deed of assignment for the benefit of creditors to the clerk, to be recorded, may be considered as a delivery to a stranger for the use of the creditors, there being no condition annexed to the assignment, making it an escrow. Ibid.

81. Where two of three assignees of a bankrupt enter into an agreement in the absence of a third, the contract is not binding on the absent assignee, unless he had previously given authority to make it, or substantially recognised or acknowledged it. Blight v. Ashley, I Peters' C. C. R. 16.

82. The agreement of the assignees of a bankrupt, to give a preference to a particular creditor, is not valid without the assent of the commissioners of bankrupt, or a certain portion of the creditors. Ibid.

83. On the general validity of assignments made by a failing debtor for the benefit of creditors. Halsey v. Whitney, 4 Mason's C. C. R. 206.

78. After the assignment, the creditors for whose benefit the assignment was made, neglected to appoint an agent or trustee to execute it, and the property assigned remained in the hands of the assignor. The property consisted principally of choses in action, which the assignor went on to collect, and divided the proceeds among the creditors, under the assignment. No one of the creditors was dissatisfied; and at any time the creditors could have taken the property out of the hands of the assignor. Held, that leaving the property in the hands of the assignor under these circumstances, did not affect the 85. Query, If such assent be necessary to assignment, or give a right to a creditor not pre-make such an assignment valid against attachferred by it to set it aside. Ibid.

84. An assignment of property for the benefit of creditors is good against a subsequent attachment, although the creditors were not originally parties to the assignment, if they have in fact assented thereto before the attachment. Brown v. Minturn, 2 Gallis. C. C. R. 557.

ments by other creditors? Ibid.

86. An assignment for the benefit of all creditors is good against subsequent attachments, although all the creditors are not parties to the deed, before the attachments. Halsey v. Whitney, 4 Mason's C. C. R. 206.

87. It is not fraud upon any attaching creditor, to provide for the payment of all the creditors, in preference to one who means to attach, by process, the property conveyed. Ibid.

79. M. was discharged by the insolvent laws of Pennsylvania, after having made, according to the requirements of the law, an assignment of "all his estate, property, and effects, for the benefit of his creditors." After his discharge, he presented a petition to congress for a compensation for extra services performed by him as United States' gauger, before his petition for his discharge by the insolvent law. As gauger, he had received the salary allowed by law; but .he services for which compensation was asked, were performed in addition to those of gauger, by regauging wines, which had become necessary by an act of congress reducing the duties 89. Query, If, upon general principles, an ascharged upon them. Congress passed an act, signment stipulating for a general release of the giving him a sum of money for those extra ser- debtor ought not to be deemed fraudulent, as vices. Held, that the assignee, under the insol- locking up the debtor's property from his crevent laws, was entitled to receive from the trea-ditors, unless they consent to relinquish a part sury of the United States the amount so allowed. of their debts? Ibid. Milner et al. v. Metz, 16 Peters, 221.

88. The assent of the creditors to an assignment, not stipulating for a release, may be presumed; aliter, if a release is stipulated for. Ibid.

attachment, or subsequently acquired lien, will avoid such assignment. Spring et al. v. South Carolina Ins. Co., 8 Wheat. 268; 5 Cond. Rep. 434.

90. An insolvent debtor has a right to prefer 80. Where A made an assignment of a vessel one creditor to another in payment, by an asat sea, in trust to B, to indemnify B for endorse-signment made bona fide; and no subsequent ments, and also to pay the demands of certain other creditors named in the conveyance: Held, that the taking possession of the said vessel by B, in a reasonable time and manner after her return, would be a sufficient delivery and possession to support the assignment, although the creditors of A should attach the vessel before such possession was obtained. Held, also, that it was not necessary to the validity of the assignment, that the creditors should be technical parties to it, nor that their assent should in any manner be given to it at the time of its execution, if they assented before any attachment of the property. Held, further, that the assignment being for the benefit of the preferred creditors, unconditionally, and without any stipula

|

91. Such an assignment may include choses in action, as a policy of insurance, and will entitle the assignee, in case of loss, to receive from the underwriter the amount insured. It is not necessary that such an assignment should be accompanied by an actual delivery of the policy. Ibid.

92. When an assignment is made for the benefit of the creditors, and some of the creditors live at a distance, and signify their assent by letter, through the post-office: Query, when is the assent complete; whether at the time when