Prentice v. United States & C. A. S. S. Co.

78 F. 106, 1897 U.S. Dist. LEXIS 6

• Court: District Court, S.D. New York
• Decided: January 16, 1897
• Status: Published

Opinion

BROWN, District Judge.

The answers of the garnishee show that he admits owing the money upon a subscription for the defendant company’s stock; but he avers that his debt is represented by a stock note given to the defendant company, payable ten days after demand, which the defendant company, about May 6, 1893, indorsed or transferred to the Central American Steamship Company, another ■corporation, in which the defendant company practically became merged. The garnishee was the president of the defendant company now defunct, all whose assets were transferred to the American Steamship Company.

, This transfer of assets, including the garnishee’s note, was evidently void as against existing creditors, among whom were the libelants. They have a right to follow the assets transferred so far as they can be identified. Where such facts clearly appear upon the face of the garnishee’s return, the authorities seem to support the right of the court to order payment by the garnishee. As, however, there may be some additional proofs affecting this right, I shall direct that a reference be taken to ascertain and report thereon, provided the garnishee within five days elect to enter an order therefor and file stipulation for costs. Further process of attachment may be issued if desired against the Central American Steamship Company, the alleged holder of the note, and a citation to appear upon such reference. Unless the above order be applied for by the garnishee, and security given within five days, an order may be entered for payment by the garnishee of the sum due upon the note, the same being less than the libelants’ claim.