Blilings v. Parsons

17 Utah 22
CourtUtah Supreme Court
DecidedJune 10, 1898
DocketNo. 910
StatusPublished
Cited by4 cases

This text of 17 Utah 22 (Blilings v. Parsons) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Blilings v. Parsons, 17 Utah 22 (Utah 1898).

Opinion

Minee, J.:

It appears from the record that N. C. Christenson made a deed of assignment of all of his property for the benefit of all his creditors, without preference, to respondent, Billings. The appellant, as. United States marshal, thereafter levied certain executions upon the assigned property, and sold it, whereupon this action for conversion was brought by the respondent. The case was tried before the court without a jury,, and judgment found in favor of the plaintiff. The appeal is taken from the judgment. The court, in its general findings, found all the issues in favor of the plaintiff, and in its fourth general finding also found that the deed of assignment was not made, executed, or delivered with intent to hinder, delay or de-fra'ud the creditors of N. C. Christenson, or any of them. By request of appellant’s attorneys, the court, as a part of its findings, found specially that on the day or day previous to the time of making the assignment, and in contemplation thereof, and while the assignor was insolvent, he paid to his employe, Billings, who was afterwards made assignee, a week’s wages, but the court did not consider such act a badge of fraud; that about this time he gave to his wife about $100 worth of goods that formed no part of his stock in trade at his store, but it did not appear where he obtained the goods. The appellant assigns error [26]*26in the making oí the fourth general finding, because it is contradicted by special findings, and to the entry of judgment upon the findings, because they are not supported by the findings as made, and in refusing to consider as a badge of fraud the payment by the assignor to one Billings, afterwards made assignee, on the day of the assignment a sum of money due him for wages, and because the assignor transferred to his wife a day or two before the assignment, goods of the value of about $100 that did not belong to his stock in trade, there being no evidence as to where he obtained the goods, or whether they were exempt from ex-execution or not. In Coblentz v. Driver, 10 Utah 96, the territorial supreme court held that: “First. Antecedent and fraudulent acts by the assignor, in which the as-signee or beneficiaries have not participated, will not render an assignment for the benefit of creditors void. Second. Mere fraudulent concealment of assets by the assignor at the time of or after the deed of assignment, if done without the concurrence of the assignee or beneficiaries, will not avoid the deed. Third. Fraudulent preference or conditions in a voluntary deed of assignment itself will avoid it, whether known to the assignee 'or beneficiaries or not. We are aware of the fact that on this latter proposition there is considerable conflict of authority, but much of it is explained by the fact that state bankrupt laws or insolvent laws directly affect many of the decisions, where no such statute exists. We think the weight of authority is that in voluntary assignments for the benefit of creditors, where the fraudulent intent of the assignor is carried into the deed itself, and made operative through it, this renders it void, without regard to the question whether the assignee or beneficiaries knew anything of it or not.” In the case referred to it appears that the as-signee was fraudulently preferred as a creditor in the deed [27]*27to a large amount. Not only the assignee, but the assignor, had knowledge of the fraudulent act, and it was properly held that, where the fraudulent intent of the assignor is carried into the deed itself, and made operative, through the deed, to the assignee, the deed was void, without regard to the actual knowledge or participation of the assignee or beneficiaries in the fraud. In the present case it appears that Billings, the assignee, was paid a small sum for wages due him from the assignor on the same-day, or before, the deed of assignment was executed, and before he had any knowledge or notice of the assignment, and that about $100 worth of goods were given grantor’s-wife on the same day, or the day before, the assignment was made; but it also appears that such goods were not taken from the stock in trade at the store that was assigned; nor where the assignor obtained the goods, nor-whether they were exempt property or not, or who actually owned them, does not appear. It also appears that such transfers were made by the assignor in contemplation of making an assignment, but it does not appear that the assignee or any creditor knew of such transfer to the wife, or participated therein. In such cases the general rule is held to be that a fraudulent intent on the part of the debtor alone is not sufficient to avoid the assignment when no preferences are made, where neither the creditor nor the assignee participated in the fraud. Bump, Fraud. Conv. (4th Ed. §§ 337-380; Pettit v. Parsons, 9 Utah 223; Coblentz v. Driver Co., 10 Utah 96; Myers v. Kinzie, 26 Ill. 36; Sackett v. Mansfield, Id. 21; Wise v. Wimer, 23 Mo. 237; State v. Keeler, 49 Mo. 548; Marbury v. Brooks, 7 Wheat, 536, 11 Wheat, 78; Bancroft v. Blizzard, 13 Ohio 30; Cornish v. Dews, 18 Ark. 172; Hollister v. Loud, 2 Mich. 309; Gover v. Campbell, 17 Ala. 566; Farrell v. [28]*28Farnam, 67 Md. 76; Levy v. Adler, 97 Mo. 413; Sipe v. Earman, 26 Grat. 563; Roan v. Winney, 93 Mo. 503.

If, in addition to the fraudulent intent of the grantor, the deed may, by its terms, and does in fact, aid in the fraud, then it is invalid; but in this case the deed cannot operate to aid in the fraud. It is a general assignment of all the property of the assignor for the benefit of all his creditors, without-any preferences. If it transpires that the debtor concealed any of his property, not included in the assignment, that was not exempt from execution, the title would pass to the assignee, and in that case it would be his duty to take it into his possession when found. Having placed all his property in the hands of a trustee for the purpose of paying all his creditors alike, the assignor cannot be said to hinder and delay his creditors. In the absence of fraud on the part of the assignor and trustee, if the trustee perform his duty as he is presumed to do, the settlement of the claims of the creditors is hastened. It is where the trustee becomes implicated and involved in the fraud, or where the fraudulent intent of the assignor is carried into the deed itself, and made operative through it by the passive or active agency of the trustee, or the deed itself, that it can be said the deed is made to hinder, delay, and defraud creditors. In such a case the deed is void. The record discloses no fraud or participation in any fraud on the part of the assignee. It does not appear that he had any knowledge of the assignment until the day it was made. The fact that he received payment of a week’s wages due him for labor the day before the assignment was made does not connect him with any fraud in making or procuring the assignment to be made, even if the payment was made by the assignor in contemplation of making the assignment. It appears the debt was a just one; [29]*29therefore the debtor had the right to pay it before the assignment was made, or prefer the debt in the deed of assignment. In the absence of a bankrupt law or statute, a debtor has a perfect right to pay a debt or prefer a creditor in a deed of assignment of all his property for the benefit of all his creditors.

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Bluebook (online)
17 Utah 22, Counsel Stack Legal Research, https://law.counselstack.com/opinion/blilings-v-parsons-utah-1898.