Coit v. Horn.

Kent allowed an injunction to restrain trespasses, where the right was clear, and the trespassers acting under the defendant's directions, were numerous.

And in Vechte v. Brownell, (8 Paige, 212,) the present Chancellor held, that where the defendant was proceeding to foreclose a mortgage under the statute, claiming more than was due, and the complainant had offered to pay all that was due; a bill to stay the sale would be sustained, although the complainant could recover back at law, the proceeds of the sale, beyond the amount actually due.

The principle of these cases is applicable to the one now under consideration, and supports the jurisdiction of this court. The complainant is entitled to a perpetual injunction against the distress warrant, and against any proceeding relative to the rent of the premises, accrued to the first day of August, 1842. The defendant Horn must pay the complainant's costs. He was doubtless a sufferer by his lenient course towards Cook, but in reference to the complainant, he was fully advised that he could not claim interest. The testimony of his son shows that he knew this before the first of August, when he sent to the complainant the statement of rent due. Yet afterwards, and on the last day that the parties were together, he insisted on the payment of interest on the arrears, as the only mode in which the difficulty between them could be settled. And within a few days from that time, he issued a distress warrant, not claiming interest, but claiming nearly $300 more than was due to him for the rent in arrear.

The fund in court will be paid to the defendant Horn, after deducting the taxed costs of the complainant.

Van Nest v. Yoe and others.

VAN NEST v. YoE and others.

A voluntary assignment was executed by A. and B., conveying the whole of their estate and effects to C., in trust for the benefit of all their creditors, giving a preference to C. It appeared by the answer, that the assignors executed it because they were unable to pay their debts, as they would respectively fall due and become payable, and with a view of having their effects and claims turned to the best account, and to have them, or the proceeds thereof, applied to the payment and satisfaction of their debts and liabilities, so far as the same were necessary for that purpose. It also appeared, that at the time of its execution, the assignors supposed they were solvent, and would have a surplus after paying all their debts. Held, that the assignment was made with the intent to hinder, delay or defraud the creditors of A. and B.

The conclusion would have been the same, if it had appeared that the assignors were in truth insolvent at the time of its execution; it being clearly proved that they believed they had a surplus, and executed the assignment with a view to such surplus. The law regards the intent of the assignor, and the result of his acts will not cure the fraudulent design.

The want of an inventory of the effects assigned, and the omission of a schedule of the creditors of the assignors, deemed a badge of fraud in connection with other circumstances.

So of a provision in the assignment, that the assignee should not be accountable for any defalcation committed by any clerk employed by the assignors, or either of them, in the execution of the assignment.

The assignee was the father of B., and resided about 300 miles from the place where A. and B. transacted business. He never took the actual possession of the property assigned; leaving A.'s effects in his possession, and those of A. and B., in the possession of the latter, to sell and collect. Held, on this ground also, that the assignment was fraudulent.

The complainant's partner had received a payment on account of his debt, from the assignee; but he had been informed that the creditors were all to share alike under the assignment, and he was ignorant of the fraudulent circumstances connected with it. Held, that he was not, by such receipt, precluded from setting aside the assignment for fraud.

April 8; April 26, 1843.

THE complainant obtained a judgment at law, against the defendants R. A. Yoe and J. R. Bleecker, and issued an execution thereon, which was returned unsatisfied.

He thereupon commenced this suit against the judgment debtors and Charles Yoe, their assignee, to set aside their assignment as fraudulent and void against creditors, and to compel payment of his debt.

Van Nest v. Yoe and others.

The debtors, Yoe and Bleecker, were hardware merchants in the village of Syracuse, in the county of Onondaga; R. A. Yoe residing there, and J. R. Bleecker residing in the city of New-York. On the 25th of April, 1837, they made an assignment of all their property to Charles Yoe, of Sing Sing, in Westchester county, the father of R. A. Yoe, for the benefit of their creditors, giving a preference to Charles Yoe over all the others. The facts bearing upon the points discussed are stated in the opinion of the court.

John W. Hammersley, for the complainant.

Jona. Miller and J. Blunt, for the defendant Charles Yoe.

THE ASSISTANT VICE-CHANCELLOR.-The complainant alleges that the assignment in question is fraudulent and void upon its face, as being intended to hinder, delay, or defraud creditors; and refers to several provisions of the instrument in support of this position.

One of those provisions is thus expressed :-"Nothing however herein before contained shall be considered as restricting or preventing" the assignee "from liquidating or compounding with any of the creditors" of the assignors "by making over, assigning, or transferring, any of the choses in action, debts or accounts due to the" assignors. This is rather the reservation of a supposed existing right, than the grant of a power. We are not to imply a power from the instrument in order to overturn it, but we are to construe it if practicable, so as to give effect to every part of it. Having this rule in view, I cannot presume a fraudulent intent from this clause. The preceding provisions of the assignment are full and explicit that the proceeds of the trust fund, after satisfying the debts due to Charles Yoe, and for which he is liable, shall be applied rateably to the payment of all the other debts of the assignors, without any priority or preference.

Another provision deemed objectionable, is the power to mortgage. This is not contained in the declaration of the trusts of the assignment, but in the clause constituting the assignee

Van Nest v. Yoe and others.

the attorney of the assignors to do various acts in their names in the premises, such as "to make all deeds or proper conveyances, assignments, mortgages, releases or discharges," &c. The case of Darling v. Rogers and Sagory, (22 Wend. 483,) decides that this power, if it had been made one of the express trusts of the assignment, would not render it void, and it is unnecessary to consider it farther.

The next provision which I will consider, is that relative to the defence of suits against the assignors. It is a part of the clause making the assignee their attorney, and empowers him, "in his or their name or otherwise, to commence, continue, "6 maintain, and prosecute to effect, and also to defend all law, "C equity, and other proceedings, which they may deem neces"sary to the execution of the said trusts." Although the word "they" is used, it is plain that "he" was intended, and giving the sentence its literal scope, it merely confers a discretionary power to defend suits, which the assignee, would execute at his peril, as between him and the creditors interested. I do not perceive in this provision any marked evidence of fraud, nor indeed much that the assignee could not have done if the whole clause had been omitted.

The next sentence in the assignment forms the ground of another objection. It provides that the assignee shall not be accountable for any defalcation, committed by any clerk, agent, or assistant, "necessarily employed by them, or either of them, in the execution and performance of the trusts hereby created." The language of the instrument here applies to clerks, &c., employed by the assignors. The defendant insists that this was a clerical mistake, as well as the word "they" in the clause just considered, and the word "they" in the conclusion of the instrument, by which the assignee is made to covenant that he and the assignors will faithfully execute the trusts. This explanation would be satisfactory in reference to the sentence in question, were it not that subsequent events show that the employment of clerks by one of the assignors was probably in the contemplation of the parties at time of making the assignment. This exemption from liability, if intended to be limited to defalcations by clerks employed by the assignee, is

Van Nest v. Yoe and others

not restricted to his employment of clerks in good faith. And I cannot but regard the whole provision as one calculated to impress the mind with serious doubt as to the honesty of the instrument in which it is found. (See Pitt's Trustees v. Viley, 4 Bibb, 446.)

Another objection is, that the assignment directs the payment of the separate debts of the assignors to Charles Yoe, out of the partnership property. It is not necessary for me to inquire whether this evinces a fraudulent intent, inasmuch as it turns out that Bleecker's separate property assigned exceeds the whole amount of the separate debts of both partners.

The next objection to the assignment is the absence of an inventory of the property and effects assigned. This is not of itself a strong badge of fraud, but frequently becomes one in connection with other circumstances. This case well illustrates the importance of an inventory. The assignee does not give a statement or pretend to know, what property was assigned to him, or its amount. It is evident that he never did know. The assignment was dated in April. He attaches to his answer a schedule showing an inventory of goods on hand dated in May; and another schedule containing the debts due to Yoe and Bleecker in August, 1837, four months after the assignment. In the mean time, R. A. Yoe was in possession, selling the goods, and collecting the debts. The defendant says that these schedules contain all the assigned property which came to his possession or knowledge. This may be conceded, and still leave a wide margin for fraudulent dispositions by the assignors, of other property to a large amount. The assignment is also silent as to the names of the creditors, and the amount of their debts, with the exception of the preferred claims of Charles Yoe, and the answer does not supply the omission.

I will now examine the case, as it is presented to me by the evidence.

It appears that Yoe and Bleecker made this assignment, not because they were insolvent, and desired to benefit all their creditors by avoiding the sacrifices which the more vigilant of the number might otherwise occasion to the pre