Falk v. Janes.

city of New York, by his act or with his assent, on the day the warrant was served on him there, and the ownership thereof was at the time in him, it was subject to judicial process or judicial proceeding against him there, and was, on compliance with the statutory provisions, charged with the claims attaching thereto by virtue of the laws of that state (Green v. Van Buskirk, 5 Wall. 307; S. C., 7 Wall. 139; Hervey v. Rhode Island Locomotive Works, 93 U. S. 664; Cronan v. Fox, 21 Vr. 417; Elizabethtown Savings Institution v. Gerber, 8 Stew. Eq. 153, 156; In re Queensland M. & A. Co., 1 Ch. 536 (1891); affirmed, 7 Ch. 219 (1892), and that such title as Craig possessed in the policy on November 9th, 1889, was vested in Falk as receiver on his complying with the requirements of the statute regulating his appointment. Will the complainant's lien as such receiver be respected and enforced in the courts of New Jersey, the security being now in this state in possession of a citizen thereof, also a creditor of the said Craig?

A receiver appointed by a court of another state is recognized in this state as competent, under certain conditions, to prosecute a suit in the courts thereof. Knapp v. Hoboken, 9 Vr. 371; Hurd v. City of Elizabeth, 12 Vr. 1; Bidlack v. Mason, 11 C. E. Gr. 230; National Trust Company v. Miller, 6 Stew. Eq. 155; Sobernheimer v. Wheeler, 18 Stew. Eq. 614. Counsel for defendant Janes urges that such standing in court should not be accorded in this case, because thereby a foreign receiver may be enabled to take funds of the judgment debtor out of the state, to the prejudice of his client, who is a citizen thereof and a creditor of said judgment debtor. Chancellor Runyon, in Bidlack v. Mason, supra, says: "The aid of the court is extended to foreign receivers on principles of comity." Chief-Justice Beasley, in Hurd v. City of Elizabeth, supra, says: "That the officer of a foreign court should not be permitted, as against the claims of creditors resident here, to remove from this state the assets of the debtor, is a proposition that appears to be asserted by all the decisions."

The chief-justice dissents from the position taken by some, that a receiver will not be recognized as suitor outside the juris

Falk v. Janes.

dictional limits of the court appointing him, and states as a more correct definition of the rule "that a receiver cannot sue, or otherwise exercise his functions, in a foreign jurisdiction wherever such acts, if sanctioned, would interfere with the policy established by law in such foreign jurisdiction."

Further on, he says: "It (such power) could not be exercised in a foreign jurisdiction to the disadvantage of creditors resident there, because it is the policy of every government to retain in its own hands the property of the debtor until all domestic claims against it have been satisfied."

Such limitation is based, then, on the principle that the first duty of the state is to its own citizens. While, if they are not affected, it will, by comity, permit to a foreign receiver, representing foreign creditors, a standing in court to recover property to apply in satisfaction of their claims; such comity is not to be extended if there are domestic creditors, its own citizens, whose claims will be thereby impaired or jeopardized.

In this case we have a defendant, a citizen of New Jersey, who invokes this doctrine, but, on the other hand, the complainant is a receiver in a suit prosecuted by James M. Frost, another citizen of this state. Under his appointment complainant is receiver only for Mr. Frost, as it does not appear he is appointed in any other suit, and he is entitled to be regarded only as the representative of Frost and to be paid only his debt. Bostwick v. Menck, supra. He is prosecuting, then, not in behalf of foreign creditors, but in the interest of, and for, one of our citizens. This is a condition of affairs which does require the refusal of recognition of a foreign receiver as a suitor, and the suit should be retained.

What interest, then, had Daniel Craig in the policy on the 9th of November, 1889? The defendant Janes claims that this policy belongs to the estate of Henry Baird-first, by force of an assignment in writing; second, by virtue of certain acts of Mr. Craig.

The defendant Janes claims by virtue of an assignment, in writing, which is as follows:

Falk v. Janes.

"Know ye that I, Daniel D. Craig of Morristown, New Jersey for and in consideration of the sum of one dollar to me in hand paid and other good and valuable consideration me thereto moving, do for myself, my executors and administrators sell, assign, transfer and set over to the estate of Henry Baird deceased, all my right, title and interest of, in and to a certain policy of insurance No. 261,527 issued by the Mutual Life Insurance Company of the City of New York upon my life.

“Witness my hand and seal at the city of Morristown, New Jersey the twentieth day of February, eighteen hundred and eighty-nine.

purporting to have been acknowledged October 18th, 1889, in the city of New York before Albert I. Sire, a notary public.

Passing by objections to the form of this instrument, was it effective before the receiver's rights attached?

The bill of complaint in this cause called upon the defendantsMr. Janes and upon Mr. Cutler respectively to state when, where, by what conveyance, from whom and fully upon what terms each received the life insurance policy. Answer was required under oath, and Mr. Janes, in his answer, says he secured and obtained from the said Daniel D. Craig a policy of insurance on the lifeof said Daniel D. Craig issued by the Mutual Life Insurance Company of New York, dated March 21st, 1885, for $2,500, and payable on the 23d day of March, 1895, marked 261,527, and accompanying the said policy was an assignment in the wordsand figures following, that is to say (setting out the assignment and the acknowledgment), but he nowhere states when he obtained the same.

Mr. Cutler, in his answer, says that he is proctor of Mr. Janes's administrator, and as such proctor has received the policy of insurance referred to in the said bill, and the assignment of the same by the said Daniel D. Craig, late executor and trustee of Henry Baird, deceased, and holds the same as proctor of Lewis T. Janes's administrator with the will annexed and trustee aforesaid, but does not state when, or from whom, he received the said papers.

The order made in the city court of New York on December 2d, 1889, in the case of Frost v. Craig, prepared in the office of Albert I. Sire, the attorney of Craig in New York, was intro

Falk v. Janes.

duced in evidence. A comparison of the handwriting of this order so prepared in the office of Mr. Sire with the body of the assignment relied on, clearly shows that both papers were written by the same hand. The assignment is dated February 20th, 1889, and purports to have been acknowledged October 18th, 1889, and although the question as to the control and ownership of Craig of this policy was directly involved in the proceedings in New York on the order to show cause, Mr. Craig, who was extensively examined as a witness November 25th and 26th, 1889, on the supplemental proceedings, did not mention this assignment, and although Mr. Albert I. Sire, Mr. Youngblood and Mr. Cutler each made an affidavit verified December 19th and 20th, 1889, all subsequent to the date of acknowledgment of this assignment, which affidavits were used on the hearing of the order to show cause, there is not a word in either of them to prove that the assignment existed on November 9th or December 2d, a fact which might have been conclusive if it could have been established.

An adjournment was taken in this cause for the purpose of examining Mr. Sire with reference to this matter, as well as any other testimony he might be able to give, but defendants failed to produce him. I am constrained to believe that this paper was prepared subsequent to the proceedings in the suit in New York, and subsequent to the time it purports to be dated, as well as the time it purports to be acknowledged, and was so antedated for the purpose of depriving the complainant of any rights which he might have acquired under the laws of New York, and that it had no existence on the 9th of November, 1889, when the complainant's lien on the policy vested. But if it did, delivery was essential to its validity as a transfer of title. The possession of Mr. Sire and Mr. Youngblood, both of whom were Mr. Craig's counsel, was his possession. The assignment became effective only when it was delivered to Mr. Cutler as the representative of the Baird estate. No date is reliably fixed as to when it came into his possession. Mr. Youngblood says he received it between November 9th and 10th and December 19th. Mr. Cutler does not attempt to give any date when he received it. It appears

Falk v. Janes.

from his examination that he gave notice to the insurance company December 27th, and from his affidavit, verified December 19th, it appears that he at that time had it. From the contest for the ownership of the policy, it is fair to presume that this notice was given soon after the delivery of the assignment to Mr. Cutler.

I find nothing in the evidence to indicate that the assignment was delivered to him until after the rights of the complainant,. whatever they might have been, had attached.

It is next claimed that the estate of Baird, of which Mr. Craigwas the executor and trustee, is entitled to the first lien upon the policy, by virtue of certain acts alleged to have been performed by Mr. Craig with reference thereto.

No testimony was given before me to establish this contention;. but, after the death of Mr. Craig, and on the last hearing, the evidence taken in supplemental proceedings being offered, it was agreed that the record in the court of common pleas of New York, on appeal from the order, be in evidence.

It appears by this that Mr. Craig, being examined November 25th, 1889, testified, with reference to the policy in question, that he might have been spoken to about assigning the policy to Edward Halsey, of Morristown; that he told Frost that he was not ready to assign it to secure his claim; that a good many had been after it; that he did not want one man to get everything.

"Q. Why did you refuse to assign it to Frost?

"A. I done it because it belonged to an estate that I was executor for; at least I kept it among those vouchers.

"Q. What estate was that?

"A. Baird's-Henry Baird.

"Q. Where did you keep those vouchers?

"A. I kept them in my box as a general thing; a tin box I had.

"Q. Are you indebted to that estate?

"A. I think not; somebody wanted to get me removed as executor, not because I did not have the securities there.

"Q. Did you owe that estate?

"A. Not if they put me out; I turned over all that I had except this policy, and I turned over this policy; I kept that in with other papers belonging to the estate.

"Q. How much did you owe that estate?