Varnum v. Camp

13 N.J.L. 326
CourtSupreme Court of New Jersey
DecidedFebruary 15, 1833
StatusPublished
Cited by1 cases

This text of 13 N.J.L. 326 (Varnum v. Camp) is published on Counsel Stack Legal Research, covering Supreme Court of New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Varnum v. Camp, 13 N.J.L. 326 (N.J. 1833).

Opinion

By the Court.

A verdict was in this case taken for the plaintiff subject to the opinion of this court, upon the questions of law arising from the evidence given at the trial.

The action is in replevin for sundry articles of merchandize. Both parties admit, that on and before the first day of December 1828, these articles belonged to William Roy, and were in his possession in a store kept by him at Paterson, in the county of Essex. The defendant, who was sheriff of that county, on the Tth February, 1829, took them in virtue of an execution sued out on a judgment of that date, in favor of William Swan and James Anderson, against William Roy; to whom as the sheriff alleges, the merchandize then belonged. The plaintiff insists. [327]*327that he, and not Roy, was then the owner, and that lie became so on the first day of the preceding December by means of an assignment from Roy, whereby the property was legally transferred to him, and which was, he says, immediately followed by a change of the possession.

The question as to the change of possession may be postponed until we shall have enquired into the validity of the transfer, and will then only become material if the assignment is legal and effectual, for if fraudulent and void, and if thereby no property vested in the plaintiff, the actual possession of the articles by him would not have prevented the seizure and occupation of them by the sheriff.

The validity, operation and effect of the assignment, form the prominent and principal question in the cause.

This instrument was executed in the City of New York, where Varnum and Roy were at the time resident merchants, the latter also carrying on the store at Paterson, by the agency of a clerk, and by his own occasional attendance. It bears date, December 1, 1828'. The object expressed on the face of it is to benefit his creditors and for the payment of his debts. It purports to convey all his estate real and personal, especially mentioning among other things, the goods in the store at Paterson, to Joseph B. Varnum, intrust, to defray the expenses attendant upon the execution of the trust, and thereafter to apply the proceeds and avails, by taking up and paying certain specified notes indorsed by John Laroque, and any other notes, if any should be drawn by Roy and endorsed by Laroque, and against which notes Varnum had by a bond of the same date engaged to indemnify Laroque, who had lent his notes and endorsements to Roy for his accommodation, or in other words to secure and perform payment out of his estate, to Laroque a favored creditor, and then to divide among his other creditors, in full or pro-rata, as the case might be, and to return the surplus, if any, to Roy.

At the outset of our enquiry, I premise that I shall undertake it under a belief there is no actual fraud in any part of the transactions necessary to be examined. I find none, nor any grounds from which, as I apprehend, an inference of such fraud could justly be drawn by a jury. The plaintiffs brief seems indirectly (in a parenthesis) to qirestion whether the judgment of Swan and [328]*328Anderson was not by Roy’s procurement, or by collusion with him. There is nothing, however, which I can discern in the evidence to support a suspicion of this kind, and they are acknowledged creditors to very nearly the amount of their judgment, in the schedule made by Roy and accepted by Yarnum. In th§ assignment and matter connected with it, I can discover neither actual or attempted fraud. The declared purpose, the payment of just debts, was laudable, and. a sufficient motive and consideration. Yarnum himself was a large creditor, and his individual debt was placed not in preference but on a footing with others. And in the result it appears probable he will incur a loss beyond the amount of his original debt, whatever may be the termination of the present suit.

It may also be assumed, for so both parties indirectly, if not. explicitly admit, that the assignment in New York, where it was made and where Roy as already remarked then resided, is legal and valid, and is effectual to convey and transfer to Yarnum all the property mentioned in it then within the bounds or jurisdiction of that state. I entertain no doubt that such is the settled law there. 2 Kent. Com. 429; Mackie v. Cairns, 5 Cowen 547.

But by the law of New Jersey, an assignment like the present is, as respects creditors,,not parties, illegal, invalid and ineffectual, to divest the property of the grantor, or to transfer and convey an available interest to the grantee. Our statute enacts, that every conveyance or assignment made by a debtor of his estate, real dr personal, or both, in trust to' the assignee or assignees for the creditors of such debtor, shall be made for their equal benefit, in proportion to their several demands to the nett amoimt that shall come to the liquids of the assignee or assignees for distribution, and all preferences of one creditor over the other, or whereby any one or more shall be first paid or have a greater proportion in respect of his, her, or their claim, than another, shall be deemed fraudulent and void, except mortgage or judgment creditors, when the judgment has not been by confession for the purpose of preferring creditors. Rev. Laws 674, sec. 1. To make a valid assignment then under the influence of this statute, two things are essential. 1. That it should be for the equal benefit of the creditors, for the statute directs that it shall be so made; and 2d, that it creates no preference, for all preferences are declared fraudulent and void, and conse[329]*329quently the instrument, whereby they are attempted must he of the like character.

The position of the plaintiff’s counsel, “ that the statute does not declare assignments not made according to its provisions to be void, but affirms the assignment, declares what shall be the effect of it notwithstanding its provisions and oidy makes void so much of it as gives a preference except to mortgages and judgments,” cannot be sound. The statute declares how they shall be made, that is to say, for the equal benefit of the creditors, and not merely that such shall be their effect in what way soever made. An assignment therefore made in a manner prohibited and forbidden must be invalid. The express denial of preferences, is in truth but an amplification of the antecedent clause of the statute, and without really adding anything to its extent or perhaps to its force, serves to express in distinct terms the legal effect and operation of that prior clause. It follows then that were an assignment not made for the equal benefit of the creditors, but whereby a preference is sought to be given to any one not a creditor by mortgage or judgment, over another, is in contemplation of law, fraudulent and void. However clear then it may be of moral turpitude, or actual fraud, it can no more, than if thus tainted, prevail against an execution creditor.

In this view of the case then, the question is presented whether an instrument legal where made, and at the domicil of the maker and efficient to transfer his property there, can dispose of his moveables situate here, in a manner prohibited by our law, inconsistent with its policy, and declared by it fraudulent and void.

The general principiéis fully and unequivocally settled.

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Cite This Page — Counsel Stack

Bluebook (online)
13 N.J.L. 326, Counsel Stack Legal Research, https://law.counselstack.com/opinion/varnum-v-camp-nj-1833.