By JUDGE COLLIER.
On the answers of the garnishees, the plaintiffs moved the Court below for a judgment against them; which motion was overruled, and a judgment rendered by which they were discharged. The correctness of which judgment is now assigned for error. In determining this question, two points are presented: 1. The legality of the deed which accompanies the answer of Messrs G. G. & Co. 2. The extent and effect of its operations.
The counsel of the plaintiff insists, that the deed cannot be recognized as valid, and that it is a fraud in law upon the creditors of the assignors who have not executed it, for ■these causes:
1st. Because there is no proof of execution by the assignors, trustees, or any of the creditors, nor of the delivery •of the property conveyed.
2d. Because there is no specific description of the lands, personal estate, notes, accounts, &c. and the debts proposed to be secured.
3d. Because it gives a preference to some of the creditors over others.
4th. Because it is in itself the making of a bankrupt law, for the benefit of the assignors.
We are inclined to the opinion that the deed, for any thing appearing on its face, is valid at law, without an execution of it by any of the creditors of the assignors. It conveys all their property, without an estimate of its value, for the payment of three hundred dollars to Samuel Clark, and then to such other creditors as might execute it; no act is required to be done by Clark, to entitle him to the benefit of the deed, but as to him, the deed becomes immediately operative on its execution by the assignors. Nor is it considered of the essence of the deed that the trustees should have executed it, or assented to the trust; if they had refused,-equity could appoint others in their stead, with all powers which the deed conferred.
But the deed purports to have been executed by the assignors, assignees, and some of the creditors; and wore it necessary, we might presume an execution by all the parties whose names appear, and more especially by the creditors, as it is for their benefit.b It is however unnc'ces'sary to resort to presumption, for the answer of the gar[99]*99nisheesmust be regarded as strictly true; and even if the deed be disregarded, no judgment can be rendered against them on their answers, because they state they have been advised that the assignors have transferred .their claims against them. We must take the assignment to have been legal, unless its illegality appeared from the answers, or from the deed accompanying them, or had been made manifest by the finding of a jury on an issue taken on the answers. This doctrine was settled by this Court in Allen v. Morgan, at January term, 1827. And as no issue was taken on the answer of the garnishees, if it were necessary, from the circumstance of'the deed appearing to have been executed, we would presume a delivery of the property conveyed, as it recites the fact. But here the doctrine of presumption need not be invoked, forano delivery has been made, the rights of the assenting creditors cannot be prejudiced, unless they dispensed with it, or did some other act from which fraud is inferable-. No act of the trustees can affect the assenting creditors, unless they in some degree contributed to it; because the trustees are only agents for the assignors.a The facts so far as developed by the record, discover no improper conduct^, by fhe assenting creditdrs. . /
With regard to the generality of description of the property conveyed, and of the debts intended to be secured, this cannot be held to invalidate the deed.. However proper it might be to require a specific description of property, where a conveyance is made for the security of a particular debt, that it might appear that the security was not largely disproportioned in value to the amount of the debt,, we* should hesitate before we could say, that that circumstance, would, of itself, avoid such a deed. But where a debtor-conveys his entire property for the benefit of all his creditors, we are unable to discover any sensible reason why he-should particularize each object. As every thing is given, it will not be, to be distinguished from other property;, and as it is granted for the payment of all the creditors, it cannot be objected that it is greatly disproportioned to the debts of those who have come in under the deed. Nor have we been able to discover any reason why the lands eenvoyed should be described by metes and bounds; they can be identified by the title papers, which it is presumable %vere in the possession of the assignors; and when the trustees have made out a title in the assignors, they can use the deed as evidencing an assignment of that title to them[100]*100selves. But even suppose the title would not be good at law, the powers of Chancery might be invoked against the assignors, by a purchaser from the assignees, and a decree obtained for a more perfect conveyance. It is even enough if the deed passes the equitable interest in the lands; it is now well settled that such interests shall at law be protected from attachment.
*It is a well ascertained rule of law, that the right of the clebtor to control his property is full and complete, and not subject to restraint by law, until the creditor acquires a lien upon it.a In countries where bankrupt laws obtain, a different rule of jurisprudence prevails; it is there held, that the effects of'the bankrupt must be distributed among his creditors according to the provisions pf a certain law, and that a distribution upon any other scale, would be a fraud on it, and consequently void.
The right of the debtor to dispose of his property being uncontrolable by law, where there is no lien already attaching in favor of the creditor; it follows necessarily that he may secure the debt of one creditor in preference to another, and that the security given cannot be prejudiced by the insolvency of the debtor, if the creditor has not acted improperly in obtaining it.
That the deed is the making of a bankrupt law, for the benefit of the assignors, is an ar gument which we think cannot be well founded. Before, with any degree of justice, it can be assimilated to a law, it would be proper to shew that it was compulsory upon the creditors: this we apprehend will not be insisted on. The creditors may or may not assent to its provisions; if they yield their assent, they must be paid as it directs, if they withhold it, they can only look to the property conveyed after the debts of the assenting creditors are satisfied. This objection, we conceive, acquires no weight from the fact, that the assent of the creditor operates a release of the liability of the assignors from payment, on a deficiency of property for that purpose; for, as already remarked, he is Hot forced to assent. It seems to be the better opinion, that a debtor may indirectly exercise a coercion over bis creditors, by requiring them, if they take a benefit under the deed, to give a release.b The commentator refers to authority, and none that we have seen maintains the converse of the position.
The counsel of the plaintiff insist, that the assignors had no greater control over their property, without the jurisdic[101]*101tion of New-York, than the law has in England over the óslate of a bankrupt. In answer to this argument, it may ho proper to shew how far a sequestration, by a commission of bankruptcy, operates upon the estate of the debtor. The law in relation to bankruptcy is municipal in its character, owing its force and operation to the Legislature of the particular country, and not dependant upon any rule ■adopted by the community of nations for the adjustment of commercial intercourse; hence it follows, that its influence is limited to the government that adopts it, and that it cannot operate upon the citizens of another nation, that has had no agency in its enactment, and can never have assented to it, as forming rules for judicial action within its sovereignty. In this view we are well sustained.a Lord Karnes, in his “Principles of Equity,” b in discussing the question as to the effect and extent of the English bankrupt laws, says, “law cannot force the will,nor compel any man to make a conveyance. In place of a voluntary conveyance, when justice requires it to be granted, all that the Legislature can do, is to be themselves the disposei’s: and it is evident that their deed of conveyance cannot reach any subject, real or personal, but what is within their territory.” In Harrison v. Steeny,c Chief Justice Marshall says, “the bankrupt law of a foreign country is incapable of operating a legal transfer of property in the United Cíales.” Other authorities are to the same point.d
Having shewn the extent of the influence of an assignment by positive law upon the estate of the debtor; we propose next to inquire, whether there be any analogy between such an assignment, and one made by the debtor himself. ín respect to the right of the owner to control his property, it is assumed as a correct rule, that, intime oí peace, personal properly has no locality; and that therefore it is competent for him to dispose of it by any legal conveyance, though it may at the same time be without the country of his residence, or the place where the conveyance was executed. A different rule might seriously affect trade, and would require an inhibition upon the transfer of property to an impolitic extent. Lord Karnes, in his “Principles of Equity,”e speaking of the distinction between a transfer by the party himself and of a commission oí bankruptcy, says “the former has no relation to place; the latter, on the contrary, has the strictest relation to place, and reaches not lands or mo veableseatfra ierritorium.” Chancellor Kent, in Holmes v. Remson,f and Chief Justice Par[102]*102sons, in Goodwin v. Jones,a both agree, that such is the effect of a conveyance by act of the party; and contend, that a conveyance by act of the law operates co-extensively with the law. In relation to lands, they may be conveyed by the employment of those ceremonies which the lex rei slice has made essential to a transference of right; though they be not situate in the country where the conveyance is executed. This proposition seems to us legitimately to result from the-idea of private property, and a conclusion flowing from what we have said in relation to personal estate.
It is not pretended to question the right of any country to regulate, by positive law, the disposition of personal property found within its limits, so as to give a preference to its attaching creditor over the assignees of a non resident debtor. Such á right we believe to exist when it has not been abolished by the restrictions of fundamental law. But when this right has never been exercised, it is compatible with the rights of sovereignty for the legal forums of every country, to give effect to a conveyance by act of the party; and in point of law, they have no discretion in refusing their aid. We have no statute which sequesters the estate of the non resident debtor, though insolvent, for the benefit of the resident creditor, and cannot therefore deny to the deed the effect it proposes.
The reason employed, sustained as it is by authority of the highest respectability, we think most manifestly shews, that the parallel insisted on between the two descriptions of conveyance, cannot with justice be drawn: the one i» voluntary, the other in invitum; the one is the act of the party, the other the act of the law; the one reaches the estate of the assignor wherever it may be, the other only where infra terilorium.
Having patiently investigated the case, we are of opinion, that the Court, below decided correctly in refusing a judgment against the garnishees, and the judement must therefore be affirmed.
By JUDGE SAFFOLD.
The questions presen ted by the various assignments of error are: 1. Does sufficient evidence of the due execution of the deed of assignment appear to have been offered to the Circuit Court, to defeat the plaintiff’s attachment? 2. Is the deed on its face legal and valid according to its stipulations; or by legal construction, is it fraudulent and void? No evidence is furnished of the execution of the instrument, except by the assignors; their [103]*103execution is certified by a notary public, but neither the notarial certificates, or any other shewing, testifies any thing respecting the signing or sealing by either of the assignees or creditors. It is true, the deed transmitted to the garnishees, perhaps by mail, and by them shewn to the Court, purports to have been executed by two of the assignees and some twenty creditors. It cannot, however, be overlooked, that the garnishees admit their indebtedness to the defendants, and state they received notice from the persons named as assignees, of the transfer by deed as above described, but they do not profess any knowledge of the genuineness of the deed; or claim any interest in it. The state of the question is therefore essentially different from what it would be in a case where the assignors are summoned as garnishees, and claim title in themselves, cither individually, or as trustees for the benefit of creditors, and consequently deny any indebtedness to the defendants in tlie attachment. In a case of the latter description, the answer not only denies that any thing is owing, but expressly, or by implication, avers the due execution of the deed. Under such circumstances, the plaintiff must acquiesce, or, pursuant to the statute, deny the truth of the answer on oath, and take issue upon it.a But in this case, an issue could not with propriety have been joined on the facts of the answer; for it avered no material fact, except the admission of their indebtedness, and it would have 'been perfectly nugatory to contest the statement that a deed as described had existence, either genuine or spurious, and that the garnishees had notice of it.
Evidence of the execution by the assignees, may be dispensed with, and the fact of their assent presumed; or if it be otherwise, Chancery is competent to remove the difficulty by compelling them to appropriate the funds according to the directions of the trust. If the assignment was absolute for the payment of all or any portion of the creditors, without requiring their release or assent as a condition precedent, then as they could have no inducement to refuse, their assent might be presumed, as was done in the case of Brooks v. Marbury.b But where the act of becoming parties to the deed by executing it is expressed as the only condition on which they could claim any interest under it, neither the case referred to, or, as I think, any others cited, give any sanction to the doctrine, that their assent is unnecessary to the validity of the assignment. And as I view the subject, the assent of at least a [104]*104number of creditors whose demands together, bear a reasonablo proportion to the value of the property assigned, is indispensable to the validity óf the deed; otherwise it is perfectly evident, the grossest fraud maybe committed with period;impumty.
In a case decided in the Supreme Court of Kentucky, as late as 1834, M'Kinley v. M'Clombs,a this principle was maintained in terms far less qualified. There, a deed of trust had been executed by Grimes of all his estate real and personal, expressing to be in consideration of five shillings, and for the payment of his creditors, without naming any of them; neither of the trustees were creditors, nor did it appear that the creditors were consulted, or that they consented to the conveyance. A hill was filed by a creditor against the trustees, to set aside the deed, on the ground of fraud. Chief Justice Boyle, in delivering the opinion of the Court, said, “notwithstanding the trustees allege in their answer that they accepted the trust at the request of some of the creditors, yet there was in the cause no proof of the fact, and were it admitted to be true, ¡I. could not aficct those creditors who had not made such request, or otherwise given their consent to the conveyance.” He remarks further, “it is to be sure reasonable, that tho creditors who consent to a conveyance of this soi’t, should be bound thereby, and ought not to be permitted after-wards to object to it; but it is plain they could not hind other creditors who did not consent to the conveyance.” He adds, “the deed of trust must therefore be assumed to be made by Grimes to strangers, and not to creditors, for the payment of his debts, and such a deed is merely voluntary and without consideration.” That the consideration of five shillings, expressed, would be considered as merely nominal, and' could affect the interest of no one but the assignor himself; that the deed as to purchasers and creditors, must be considered as fraudulent and void. This ho said was the doctrine of the English books, under the statute of Elizabeth, of similar import to the statutes of Kentucky, against frauds and perjuries. The same may be said of the statute of this State and probably of New-York; and it may also be remarked, as was done in the case of Sands v. Hildreth.b that the statutes for the prevention of frauds in the usual form, have been universally considered as expositions of the common law. The assignment in the case thus reported, appears to me to be far less exceptionable' than the one under consideration; and if the doctrine as [105]*105maintained in that case lie correct, it is impossible that this assignment can be valid against the rights of dissenting creditors. There, the creditors, to claim under the deed, were, not required to release their demands against the true debtor; here it was the only condition on which they could have any claim; there the trustees answered on oath that. they accepted the trust at the request of some of the creditors; here a paper is produced purporting to have been signed and sealed by a few of the presumed numerous creditors, and this is the only evidence of their assent, without a particle of proof of the genuineness of their signatures.
It is true the sum of $300, appears to have been appropriated by the deed to the payment of Clark, of Augusta; the language is rather ambiguous whether this was absolute, or on the condition prescribed for the other creditors, that he should execute the deed; but admitting it was absolute, can it be tolerated for a moment that an assignment in trust for the payment.of several hundred thousand dollars, can be preserved from the fraudulent taint by a specious pretext securing the contemptible sum of $300? The schedule annexed to the deed, purports to contain an inventory of only the favorite creditors, and exhibits debts in their favor, to the amount of about $200,000!! Whether any of these debts have a real existence, or are merely fictitious, is equally destitute of proof, or even an affidavit by the garnishees, or any of the parties to the deed, or other person. It may, however, be assumed against those claiming under the deed, from the amount of debts inventoried, and various other indications, that this was one of the most extensive mercantile establishments in the United States. But whether the estate purporting to be assigned was of the value of $100,000 or a $1,000,000, is equally uncertain. What kind of property, what proportion of land, or personal estate, or where it is to be found, is left equally doubtful. No article of property is described, nor is the name given of a single debtor to the firm.
The execution of the deed by the creditors, or their assent otherwise given to its terms, would constitute a waiver of these objections as to them; but the position ! assume, is. that this deed is not shewn to have been assented to by any creditor: also, if it were shewn that the creditors who purport to have joined in the execution, have in fact done so, and that they were bona fide creditors for the respective sums mentioned, yet as their just demands may not equal half the value of the estate, and as the assignors have [106]*106avoided giving any account of it, and as none can claim under the deed, except such as have joined in the execution 0f an(j thereby released their claims on the firm, no others can be affected by i t. It is admitted that this plain- and many other creditors, have refused to execute the deed; the consequence of which must be, that if this deed is held operative against them, their claims are entirely defeated.
2. It remains to be considered whether the deed, according to the terms it purports, is legal and valid; or by legal construction is it fraudulent and void?
The late decision of the Supreme Court of the United States, in the case of Brooks v. Marbury,a before alluded to, and which is urged on both'sides of the question, does not fully embrace the doctrine, but as far as it goes, is against the validity of this deed. It admits the principle which has been often sustained, that a debtor in failing circumstances or otherwise, may lawfully prefer one creditor or any number of creditors to others, either by the direct sale of property to them, or by an assignment in trust for their use, provided, it be done in good faith, and the preferred creditors “give their assent at the time of the execution, or if they subsequently assentin terms, or by actually receiving the benefit of it.” In that case, the assignment was made to secure payment of debts created by the forgeries of the assignor, the real existence of the debts was fully shewn, the property was described with reasonable certainty, the preferred creditors were to bo fully paid, after which the residue of the estate was absolutely appropriated for the benefit of the other creditors generally, without the condition of a release. It was understood, however, there would be no residue, and if the deed was valid, the debts due the favorite creditors would be paid, to the exclusion of all others; if invalid, the whole proceeds must go to the attaching creditors, in the order in which they stood, to the exclusion of those for whose benefit the deed was made, and others. Under these circumstances, Chief Justice Marshall, said, “it was a mere question oí legal preference, unmixed with any equitable considerations whatever.” He also said, “deeds of trust may and have often been made for the benefit of persons who are absent, or even for persons who are not in existence, and that the assent of the persons for whose benefit they are made, has never been required as preliminary to the vesting the iegal estate in the trustees. He adds, however, that if the pre[107]*107ferred creditors had refused their assent, the' assignment would thereby have been avoided; but that “real creditors, are rarely unwilling to receive their debts from any hands which will pay them; and no such unwillingness can be gratuitously ascribed, to the holders of forged notes. ”
In reference to the expressions of the Chief Justice, as to the necessity of the assent of the cestui que trust, the same remark applies, that was used by him in the same case in allusion to certain remarks of Chancellor Kent, “that they must undoubtedly be understood in reference to the case in which they were used.” His language entirely excludes the idea that in no case was the assent necessary to the validity of the deed, but he gives ample reasons why the assent should be presumed in that case; that as the preferred creditors were the innocent holders of forged notes, thej’- would doubtless be willing to receive payment from any source. And compared with this oase, other reasons equally strong may be added. The condition of their assent was not a release of all claims on the person of the debtor, or such parts of his estate as might be fraudulently concealed, or which he might afterwards acquire, as is the case here. And in that case, the assigned property being designated and described, the creditor could scrutinize -the assignment and ascertain the faith in which it was executed. Here they are left without the slightest estimate or description of the amount, kind or locality of the assigned property, except that it is all the personal estate, claims or demands, and all the lands in Georgia and Alabama, which the firm owned jointly, but not individually. Hence a creditor who might wish to examine the motive for the assignment, and the prospect of payment under it, so as to make his election, whether to join in the execution of the deed or not, must roam through the United States, without the usual and necessary-means of making the discovery.
And in this place it is necessary to notice what I consider a prominent objection to this deed; it expressly excepts, from its operation, all the separate or individual property, belonging to each of the persons composing the firm: Who can say, their separate property does not exceed the value of their joint estate, or that it does not bear a large relative proportion to it; or that they did not preparatory to this assignment, use the precaution to have no individual debts, and increase their separate property out of the joint stock? It is a rational presumption that their separate property is sufficient to constitute a reservation, which, if expressed in [108]*108the deed, would exhibit the most glaring fraud. Nor should the fact escape notice, that they assign only such lands 0f the firm as lie in the two States; what quantity of real estate they may jointly own in .the State of New York, where they reside, or elsewhere, is in no way shewn or estimated. ' The presumption -is strong, that there was a deep and secret motive for this vague, yet efficient designation.
By the rule of decision which has uniformly prevailed in Connecticut, assignments less exceptionable than this, have been adjudged fraudulent and void, as to creditors who do not assent to the terms. The principles of a case reported in 4 Day, 146, were these, “A., being in failing circumstances, executed a deed of assignment of certain credits to B. In trust, for the payment of all A’s creditors, in proportion to theif respective claims. Two schedules were annexed, the first specifying the names of several creditors, and concluding thus: “and others, to the number of about twenty creditors.” The other specifying several debtors, with the amount of' their respective debts, and concluding thus: “and.many more to the amount of more than @10,000.” That assignment was made bona fide? and due notice given to the creditors. The creditors named in the schedule, had no knowledge of the assignment at the time it.was made, hut none of them afterwards dissent* ed, except C. who did dissent. B.- was agent to a number ofthe creditors; he accepted the trust, and proceeded to make collections. It was held, that the assignment was void in law, and that C. was entitled to recover the credits assigned by process of foreign attachment.”
In the Courts ofNew-York, a doctrine has prevailed more favorable to assignments in trust for the payment of preferred creditors, than in any other tribunal of equal authority. But even there, I think the principle has not been carried so far as to sustain this deed, supposing it in fact to have been executed by the persons who purport to have signed it as creditors,
CaSe Hyslop v. Clark,a schedule was annexed to the deed containing all the property conveyed with a particular description thereof. The deed contained a stipulation, that in case any of the creditors should refuse to release their demands against the assignors, then, in further trust, to pay such of their creditors as they should appoint; certain of these creditors refused, and it was held that the trust failing as to them, resulted for the benefit of [109]*109the assignors; that the deed was therefore void by the statute of frauds, as to other creditors; and being void in part, was void in the whole on the ground, that it tended “to delay, hinder and defraud creditors.” The same I conceive may he said of this deed.
It was, however, held in the case of Murry v. Riggs,a that the deed of assignment may exclude from its benefits such creditors as neglect or refuse to assent to the assignment within a limited time, throwing the distributive shares to which they would have been entitled, into the general mass for the benefit of other creditors provided for by the deed.
But in a subsequent case, Austin v. Bell.b Spencer, Chief Justice, reviewing the case of Murry v. Riggs, remarks, that Chief Justice Thompson, in delivering the former opinion, observed that “for any thing appearing, all the creditors of Murry & Co., the assignors, were satisfied with the assignment, and the provision therein made for the payment of their debts. ” In this case, the reverse is the fact. He went on to say, “this is an important feature in which the case of Murry v. Riggs, was distinguishable from that of Clark Hyslop, and that Chief Justice Thompson in the same case assented to the decision in Hyslop v. Clark, and it could not be inferred he intended to overrule it by any thing said in the other case. The deed in the case of Austin v. Bell, was executed by persons composing a mercantile firm, to trustees, for the payment of the debts of th.e firm. It conveyed all their estate, joint and several, real and personal, their wearing apparel and household funiture excepted; and also the debts and demands due to them, either jointly or severally; the directions of the trust were among others, that the creditors named and classed in aschedule annexed, should be paid in the order in which they were classed; provided, they should within a limited time, become parties to the deed by executing the same; and upon the further trust, that in case any of the creditors named should not, within the time, become parties to the assignment, then the grantees should pay to the grantors, the proportion of such creditors who neglect or refuse. The deed also contained a release similar to the one before us. Vcry few of the creditors executed the deed* and among those who refused were the creditors whose claim was in contest. Some, however, did execute, which afforded the deed all the aid that can be derived from the assent of one or a few of numerous credb [110]*110tors. The Chief Justice, in that decision observed, that “without in the least impugning the doctrine, that a man in debt has a right to give a preference to creditors, I am bound to say, that a deed which does not fairly devote the property of a person overwhelmed with debt to the payment of his creditors, but reserves a portion of it to himself, unless the creditors assent to such terms as he shall prescribe, is in law, fraudulent and void, as against the statute of frauds, being made with intent to delay, hinder or defraud creditors of their just and legal actions.” It is admitted, this decision was mainly influenced by the provision in the deed, that the proportion of the dissenting creditors should be paid to the assignors in the event of their refusal. But if all assented, there -was no reservation, so that it could only be created by the act of the creditors in refusing their assent, and the whole of the property held jointly and severally was conveyed. It was not subject to several objections applying to this: here is shewn to have been an absolute reservation of all their separate property and all the lands of the firm, except such as are situated in Georgia and Alabama; besides the implied reservation of whatever residue may result from the refusal of part of of the creditors, to execute the deed, or of the whole, if all had refused.
The Supreme Court of Massachusetts, in the case of Ingraham v. Geyer,a decided, that an assignment in trust for such creditors, as should within a certain time become parties, and release their demands, is void as against the dissenting creditors.
On the other question raised in the argument, whether a voluntary assignment for the benefit of creditors valid by the lex loci, can affect the rights of creditors in another State or nation, than where made, I decline the expression of any opinion at present, as it could avail nothing in this case, and is considered by many of the first jurists as an important, and unsettled question of international law.
But for the reasons that the deed is not shewn, or in any manner avered to have been executed by either of the assignees or creditors; that the plaintiff and many other creditors have refused their assent, which was required to entitle them to any interest in the deed, and could only be given on terms of releasing their demands against the debtors, that all the individual property of the debtors, as well as any real estate owned by them jointly, except in the two States, is reserved, and because no estimate, inventory or [111]*111other discription is given of any of the property, I am of opinion, the deed as presented, is in law fraudulent and void, and that the judgment below should be reversed; consequently, I dissent from the opinion of a majority of the Court.
Judge Perry also dissented.
Judgment affirmed.
The Chief Justice having presided below, did not sit.
7 Whea. 53G.