Zaring v. Cox's assignee

JUDGE HINES delivered the opinion of thf, court. The conveyance by Goar to Cox, although unrecorded and without notice, gave Goar an equity superior to that of antecedent creditors of Cox, who had notice of the equity before they acquired a legal right to the property in controversy. In a contest between mere equities that which is prior in time must prevail. (Forepaugh v. Appold, 17 B. M., 630.) The subsequent conveyance by Cox to Goar for the payment of debts gave appellants simply an equitable right to claim their distributive share as creditors under the conveyance, and that [529] equity, not having been reduced to a legal right before notice of the equity of Goar, by reason of the previous conveyance by Goar to Cox in which a lien was retained, is subordinate to the claim of Goar. (Swigert v. Bank of Kentucky, 17 B. M.; Morton v. Roberts, 4 Dana, 263.) The rights of Goar against appellants remain the same after the assignment to pay debts as before. The simple deed of assignment gave appellants no rights as against Goar that they did not previously have. (Perry on Trusts, sec. 596.) It does not matter that the court below adjudged that the proceeds of the replenished stock, as well as the proceeds of the stock on hand at the time of the sale by Goar to Cox, was subject to the lien of Goar. No effort is made to set aside for fraud the conveyance from Goar to Cox in which a lien is retained upon the stock on hand and on what may be added thereto. Such a conveyance is evidently good between the- parties, and the lien attaches so soon as any stock is added, and being good between the parties, it is good as to antecedent creditors, at least until attacked for fraud. The conveyance by Cox to Goar for the payment of debts substantially authorizes Goar to manage and dispose of the property conveyed in such manner and upon such terms as he may deem proper, and directs— First. Payment of costs and expenses of the assignment, including reasonable attorney’s fees and reasonable compensation to the trustee Goar. Second. Payment of all lien debts, including rent for the land upon which the nursery is situated. Third. Payment of the general creditors of Cox. Fmirth. Payment of the remainder to Cox. [530] This suit was brought by appellants, general creditors, to enforce the trust. They claim under the assignment and not against it. In such case they are held to have accepted the terms of the assignment, and will not be heard to say that the distribution of the fund should be otherwise than therein provided. (Perry on Trusts, secs. 596, 597; Burrell on Assignments, pages 578, 579, second edition.) The deed of trust expressly provides for compensation to the trustee, and the evidence showing the allowance to be reasonable, it will not be disturbed. The action having been instituted by a general creditor, it was proper to adjudge that the cost of the litigation should be paid out of the general fund on which there is no lien. The deed of trust authorizing the trustee to manage the estate as he might deem best, and the evidence showing that it had been skillfully and economically managed, the trustee does not appear to be in fault for not sooner closing it out. The evidence authorizes the allowance for compensation made to the trustee. The court does not appear to have abused a sound discretion in refusing to allow the amended petition to be filed, as no reason is suggested why it was not sooner offered. Judgment affirmed.