National Bank v. Webster

The opinion of the court was delivered by Royce, J. The only question put in issue by the agreed statement of facts is, whether the defendant is entitled to be allowed as against the petitioners the amount of the judgment obtained against him as the trustee of Bowker, in the suit of T. J. & S. E. Ruggies v. Bowker and the defendant trustee. The right of the petitioners to claim as against the defendant the amount represented by the notes at the time they were negotiated to them, depends upon the construction to be given to the proviso to § 47 of ch. 34, of the Gen. Sts. The question as to the construction to be given to that proviso, was directly before the court in Hall v. Bowker and this defendant trustree, and the same claimants, 44 Vt. 77, and was so fully discussed in the exhaustive opinion delivered by Barrett, J., that nothing further need be added in defining the rights of banks in the purchase of such paper, as against adverse claimants. In that case the trustee process was served upon the trustee before the sale of the notes by Cummings to the banks, and after [45] Cummings had notice that a trustee suit had been commenced. And in this case judgment had been rendered against the defendant as the trustee of Bowker, before the sale of the notes to the petitioners. In the case Hall v. Bowker and this trustee, above referred to, the court say, that by the language in said proviso, “ shall become exempt from attachment by the trustee process,” “ we understand this to mean that the fact of such transfer has the active operation of exempting the paper from the process. And that in this respect it makes no difference whether previous to such transfer, process had been served that would hold the defendant if the paper had not been transferred to a bank.” The rights of an attaching creditor are as clearly defined and as much entitled to protection, as are the rights of the trustee, resulting from a voluntary or involuntary payment made to the principal debtor or for his benefit. And if the rights of an attaching creditor can be defeated by such a transfer, for the same reasons the claims of the trustee growing out of any such payment, must be subordinated to the claims of the banks. We understand that the legislature intended' by the above statute, to relieve such paper fyom all defences to which it might be subject in the hands of other parties under our trustee laws, and to leave it to stand when actually negotiated and transferred to any bank while current, upon the same footing with commercial paper under the common law. This we think is the plain meaning of the statute. If its meaning was doubtful, the consequences might be considered in its construction; but where the meaning is plain, no consequences are to be regarded in its interpretation, for this would be opposing a legislative authority. So that if the rights of trustees are not properly protected under existing laws, it is for the legislative department of the government to provide the remedy. The pro forma decree of the court of chancery is reversed, and cause remanded, with mandate to enter a decree for the petitioners, for the sum of $191.69, and interest on the same from the 29th day of September, 1868.