Stannard v. Youmans

Pinney, J. The effect of the assignment found to have been executed by the judgment debtor Manes of all his property, except such as was by law exempt, to Youmans, for the benefit of his creditors, was to pass the title to all of said property, and the right of possession as well, to Youmans, the garnishee. The title thus vested in Youmans was valid and effective as against Manes, whether Youmans gave a valid and sufficient bond as assignee or not. As between these parties, they were concluded by the assignment; but, as against creditors of Manes, the assignment was in law fraudulent and void, and they might proceed against the property by attachment, execution, or garnishment for the collection of their debts. As against Manes, Youmans had possession and right of possession. The testimony shows that, although left in the actual custody and control of Manes, he was but holding it as bailee of Youmans, the assignee, who was to come and get it when he wished to .sell it. This entire subject of the effect upon the transaction and title of the property where a voluntary assignment is not executed as provided by law was fully considered in Jones v. Alford, 98 Wis. 245. [279] The statute (sec. 1694, R. S. 1878) provides that “ all voluntary assignments or transfers whatever of any real estate, chattels real, goods or chattels, rights, credits, moneys or effects for the benefit of or in trust for creditors, shall be void as against the creditors of the person making the same, unless the assignee shall be a resident of this state, and shall, before taking possession of the property assigned, and before taking upon himself any trust conferred upon him by the instrument of assignment, deliver to the county judge or court commissioner of the county in which such assignor or some one of the assignors at the time of the execution of such assignment shall reside, not being a creditor of such assignor, a bond duly executed to the clerk of the circuit court of the county by his name of office as obligee, in a sum not less than the whole amount of the nominal value of the assets of such assignor, which value shall be ascertained by the oath of one or more witnesses and of the assignors, with two or more sufficient sureties, freeholders of this state, who shall each testify to his responsibility, and by their several affidavits, satisfy the officer taking such bond, that the property of such sureties, being within this state, is worth in the aggregate the sum specified therein.” The omission of the penal clause in the bond of the assignee rendered it void, and defeated the assignment as a statutory transfer of the property. That the omission was inadvertent, as was said in Jones v. Alford, supra, can make no difference. The objection is substantial and fatal to the validity of the assignment. By the statute (sec. 2768) it is provided that, “from the time of the service of the summons upon the garnjshee, he shall stand liable to the plaintiff to the amount of the property, moneys, credits and effects in his possession, or under his control, belonging to the defendant, or in which he shall be interested, to the extent of his right or interest therein. - . . Any property, moneys, credits and effects held by a [280] conveyance, or title, void as to the creditors of the defendant, shall be embraced in such liability.” The assignment from the defendant Manes to the garnishee was valid and operative as between the-parties to it, and void only as to the plaintiff and other attacking creditors. As to these plaintiffs, it was still the personal property of their debtor Manes, and he had an interest in it which could be taken on execution or reached by garnishee process. Inasmuch as the assignment was void as against the plaintiffs, as creditors of the defendant, Youmans, as assignee and garnishee, held this property or its proceeds received by him by a title void as to the creditors of the defendant Manes, and was chargeable on account thereof as such garnishee by the plain words of the statute. Jones v. Alford, 98 Wis. 245. The conclusions of the trial court to the contrary are manifestly erroneous, as well as the finding that the defendant in the original action had sufficient property subject to levy and sale upon execution, being the property embraced in the written assignment, more than sufficient to satisfy plaintiffs’ demand, and for that reason plaintiffs were not entitled to garnishee process, and that the same should be vacated and set aside. The property embraced in the written assignment had ceased to be the property of the judgment debtor before the garnishee proceedings were instituted, and had become the property of the garnishee defendant, subject in his hands to levy or attachment or garnishee proceedings, in favor of the creditors of Manes. The defendant was plainly liable as garnishee, and the judgment of the circuit court to the contrary is erroneous, and must be reversed. By the Court.— The judgment of the circuit court appealed from is reversed, and the cause remanded to the circuit court with directions to charge the garnishee accordingly, and for further proceedings according to law.