Fitler v. Maitland

THe opinion of the Court was delivered by Gibson, C. J. The reason no more was decided in Mitchell v. Willoch than that the assignment was not avoided by retention of possession during the period for giving bond, was that the casé called for no more; and we went no further. The entire principle of the case before us, however, was settled by the judgment in Thompson v. Watmough, which was argued at the last March term, but not reported, because the Judges present were equally divided in opinion; and Justice Huston, to whom a written opinion was furnished, signified his concurrence with Justice Rogers and myself, by letter, in vacation. As these assignments had been cut up by the recent bankrupt law, which was expected to be permanent, the decision seemed to be useless t j the profession, as a precedent, and I directed the judgment to Le entered without further consultation, and wdthout assigning the cause to a particular Judge to prepare an opinion. The reason which governed the majority, was, that an assignment of the sort is not susceptible of secrecy, like a bill of sale, which, without a notorious and bona fide transfer of possession, might be set up or suppressed at the pleasure of the parties, as events should make it expedient; but that it is a public act, like a sale on an execution, which is sanctioned by the law, and regulated by the supervision of a court of justice, so as to exclude the possibility of fraud. Such was the opinion of the court then, and such it is still. In Myers v. Hervey, (2 Penn. Rep. 481), we held that retention of possession by the former owner of a chattel sold at sheriff’s sale, is not an index of fraud, because such a sale is the act of a sworn officer under the control of a court; and there can no more be a sham sale, by a general assignment, than there can be by an execution. The recording of the instrument within thirty days, gives not only notice to the creditors and the world, but such publicity to the transaction as puts it out of the power of the parties to suppress it. The trust becomes fixed by it, and the trustee may be forced to execute it or be removed. That obviates the real objection to a bill of sale without transfer of possession, which may be made a sale or no sale, as the interest of the parties may dictate. It is the secrecy of its nature, and not the false credit it gives to the vendor by a deceptive appearance of ownership, that 'makes it inconsistent with the policy of the law; for every bailment gives the same credit, but every bailment is not forbiddenTj But by the statute which regulates these assignments, the aslignee is bound also to file a sworn inventory of the effects in the Prothonotary’s Office; and these are to be appraised by persons appointed by the court — precautions [310] that make it impossible for the assignor to withdraw any part of the property from the trust, even by connivance of the trustee, or to cover anything but the specific effects by it-. Still further. The assignee gives bond, with sureties, for the faithful execution of the trust, and consequently for the faithfulness of his agents, including the assignor, where he is one; and to complete this circle of defences against fraud, he is bound to settle an account and answer interrogatories on oath. Do not these precautions insure a faithful administration of the fund even in the possession of the assignor; and do they not seem designed to allow him to participate in it? In the matter of Darlington’s assignment, which was before us at the last term for the Western District on a question of commissions, not worth being reported, the assignor, an extensive wholesale merchant, had remained in the custody and charge of the effects for years, to collect the debts, dispose of the stock, and close the concern; and it was conceded that thousands of dollars had been saved to the trust by his industry, integrity and skill. Is not this a strong argument against an interpretation which would have excluded him ? Where the effects consist of stock in an extensive business, any other agent, properly qualified by familiarity with its details and by general experience, would seldom be found willing to abandon his own pursuits, untempted by the offer of a commission which no court would allow. It would frequently be disastrous to the creditors, were the assignor excluded from the management and care of the property; and it would be more so, could they be deprived of the benefit of the trust by the blunder or supineness of the trustee. These considerations induce us to think that assignments in trust for the benefit of creditors, were intended to be governed, not by the statute of the 13 Elk., but by our own statute particularly adapted to them. In the case before us, then, the property in the goods having passed from Kimber by the assignment, could not, by any conceivable operation of law, be revested in him for the laches of a purchaser from his assignee. But there was, in truth, no laches; for if the assignee might leave Kimber in possession without endangering the trust, why might not the same thing be done by a purchaser from the assignee, who succeeds to his title and stands in his place. If the goods could not be seized by Kimber’s creditors before the sale, they could not be seized after it; and as there was no property in his hands to answer the-execution, the return of nulla bona was strictly true. Judgment reversed.