Magnus v. Sleeper, Assignee

LyoN, J. In Baelchaus v. Sleeper, 66 Wis. 68, a direct attack was made upon tbe assignment now under consideration, and it was held that the same was executed with intent to defraud tbe general creditors of the assignor. Backhaus [222] thereupon, became entitled to pajunent of his claim out of the fund in the hands of the assignee, and the same was properly so paid. No such attack is made by the appellant, but he is in court admitting the validity of the assignment, and only demands the removal of the assignee named therein, and that some other person be appointed to execute the trusts of the instrument. ■ It may be conceded that the petition, standing alone, states sufficient cause for removing the respondent, and appointing another to administer the trusts arising under the assignment; and also that the allegations of the petition in that behalf are not expressly denied. The question then arises whether the order of June 30, 1886, is conclusive against the prayer of the petition. The account rendered b^ the respondent January 20, 1885, upon which the order of June 30, 1886, is founded, is a substantial compliance with the requirements of sec. UOl, R. S. Were it not so, each creditor of the assignor has had his day in court to make objection to it, for each of them, including the appellant, was served with due notice of the application for a final settlement of such account. A large number of such creditors (but not the appellant) availed themselves of that right by filing voluminous objections to the account, and resisting its allowance by the court. The appellant was served with proper notice of the application by the respondent to the court for a final settlement of his account. He was therefore a party to that proceeding, and is concluded by the order of June 30, 1886. At least, he is concluded by everything in it which the statute contemplates it shall contain. The statute requires the court to hear any objections made by any creditor, to take proper evidence, and to settle and adjust the accounts and the compensation and expenses of the assignee, whether objection thereto be made or not. It also provides that the order of the court thereupon “shall be conclusive upon -all pai'ties, [223] including the sureties of the assignee.” The statute also gives the assignee, or any creditor, the right to a bill of exceptions, and an appeal to this court from the order of the circuit court. Sec. 1701. It is plain that, before the court is prepared to make the final order for the settlement of the assignee’s account, it must determine whether he has fully discharged the duties of hi,s trust, and it could not properly approve the account, without determining that he has performed those duties. Having so determined, it is proper to recite such determination in the order of approval, although it may fairly be inferred from the allowance and approval of the account. In this case the order contains a recital that the assignee has faithfully discharged the duties of his trust, and in addition thereto approves and allows his account. All of the alleged misconduct and neglect of duty, charged against the respondent in the appellant’s petition, occurred before the application for a settlement of the assignee’s account, and are, therefore, negatived by the order of June 30, 1886. When a matter in issue between the parties has once been judicially determined by a court of competent jurisdiction, it cannot again be the subject of controversy between such parties, "or those in privity with them, so long as such adjudication remains in force. No rule is more firmly established in the law.' The order of June 30, 1886, adjudicated and negatived every charge against the respondent contained in the petition for his removal, whether of neglect of duty or actual maladministration of his trust. The order has never been reversed or vacated, but remains in full force. Hence it is binding upon the appellant, and he cannot be heard to controvert the findings upon which it is based. So, when the appellant presented his petition to the circuit court for the removal of the assignee, it had become verities in the case that the assignee had faithfully performed the duties of his trust, and that nothing remained to be done by [224] him but to distribute the trust funds in his hands as directed by the court. On the hearing of the petition for his removal, he showed that he had made such distribution. That terminated his duties as assignee, and the court afterwards made an order for his discharge and the1 release of his sureties. Under these circumstances the removal of the assignee would have been an absurd, and idle proceeding, and, the court very properly refused to remove him. The. appellant’s only remedy was by appeal from the order of June 30,1886. Had he obtained a reversal of that order on the merits, he would have been in a position to petition for the removal of the assignee. But while that order remains of force, he cannot be heard to allege the previous misconduct of the assignee. By the Court.— The order discharging the rule to show cause why the assignee should not be removed, is affirmed.