ty, so far as that the intervening attachment, of another creditor who is no party to the assignment, issued 533* before "such assent be given, has been preferred.a

But, subject to this qualification, the assent of the creditors need not be given at the time of the assignment; and a subsequent assent in terms, or by actually receiving the benefit of the assignment, will be sufficient. The assignment has been held to be good against a subsequent attachment, if the creditors had assented to the assignment prior to the attachment; and the assignment has been supposed to be valid, even without such intervening assent, in the case of an assignment to trustees, for the benefit of the perferred creditors. The legal estate passes and vests in the trustees; and a court of equity will compel the execution of the trust for the benefit of the creditors, though they be not, at the time, assenting,

signment, and not leave it to the assignees, or reserve to himself the right of subsequently doing it. That would be arbitrary and liable to uncertainty and abuse, and such an assignment is fraudulent and void. The debtor must, in the assignment, declare preferences, if any, among his creditors, and he cannot transfer that power to his assignee. Wakeman v. Grover, 4 Paige, 41. Barnum v. Hempstead, 7 Id. 568. Boardman v. Halliday, 10 Id. 223. The right of allowing preferences to be given at all by the insolvent debtor has been strongly condemned by judges in various parts of the United States as inequitable and unjust. 10 Paige, 229.

Widgery v. Haskell, 5 Mass. Rep. 144.

Stevens v. Bell, 6 Ibid. 339. Ward v. Lamson, 6 Pick. Rep. 350. Jewett v. Barnard, 6 Greenleaf's Rep. 381. In Boyden v. Moore, 11 Pick. Rep. 326, it was held, that an assignment in trust to pay the assignee and other creditors who were parties, and assenting, was valid. But if not parties, and assenting, an intervening attachment prior to the assent will have preference. So, a voluntary assignment in contemplation of insolvency and giving preferences made in Pennsylvania, is not good in Delaware against a subsequent attachment by a citizen there, of the insolvent's effects in Delaware. Mayberry v. Shissler, 1 Harrington's Rep. 349.

Marbury v Brooks, 7 Wheaton, 556. Brooks v. Marbury, 11 Ibid. 78. Brashear v. West, 7 Peters' U. S. Rep. 608. Ellison v. Ellison, 6 Vesey, 656. Cunningham v. Freeborn, 1 Edw. Ch. Rep. 262.

• Brown v. Minturn, 2 Gall. Rep. 537. Halsey v. Whitney, 4 Mason's Rep. 217. Hastings v. Baldwin, 17 Mass. Rep. 552.

and parties to the conveyance. The assent of absent persons to an assignment will be presumed, unless their dissent be expressed, if it be made for a valuable consideration, and be beneficial to them.b

a Small v. Oudley, 2 P. Wms. 427. Nicoll v. Mumford, 4 Johns. Ch. Rep. 529. Brooks v. Marbury, 11 Wheaton, 97. Gray v. Hill, 10 Serg. & Rawle, 436. Halsey v. Whitney, 4 Mason's Rep. 206. Ward v. Lewis, 4 Pick. Rep. 518. This rule in the English chancery seems to have been made subject to some embarrassing qualifications. If the creditors are not parties or privies to a conveyance by a debtor to trustees, to pay scheduled creditors, and do not conform to its provisions, and the trustees have not dealt with the creditors in pursuance of the deed, they cannot in chancery enforce performance, and have no lien on the property conveyed. The deed is regarded as a mere disposition between the debtor and his trustee for his own accommodation; and the property is not deemed to be withdrawn from the debtor's absolute control. If, however, there can be an actual settlement made for vesting an estate or stock in trustees for volunteers, the case is different, and the trustees having the legal estate become such for the volunteers, who, as cestui que trusts, may claim against the trustees in the deed. Ellison v. Ellison, 6 Vesey, 662. Walwyn v. Coutts, 3 Merivale's Rep. 707. Garrard v. Lord Lauderdale, 3 Simons' Rep. 1. Acton v. Woodgate, 2 Mylne & Keene, 492. In Marston v. Coburn, 17 Mass Rep. 454, a conveyance to trustees for the benefit of creditors was said to be void without the assent of the creditor, thoug assented to by the trustees; but in that case the deed was held to be incomplete, according to the intention of the parties, when an attachment intervened, and prevailed. Though assignments of possibilities, contingent interest, and of rights or chose in action, may not be valid at law unless the creditor assents, yet no difficulty of this kind exists in equity, where the assignment is considered as amounting to a declaration of trust. See the numerous cases referred to in the notes to 2 Story's Equity Jurisprudence, p. 305.

North v. Turner, 9 Serg. & Rawle, 224. De Forest v. Bacon, 2 Conn. Rep. 633. If the assignment be directly to the creditors, their assent must be shown, but if to trustees, for their benefit, the legal title passes to the trustees without their assent; but it must be made with the knowledge and privity of the trustees or the creditors. The assent of the trustees is presumed, until the contrary be shown, and if the assignment be made without their knowledge, they may, when it comes to their knowledge, affirm it, and it will be binding. Galt v. Dibrell, 10 Yerger, 146. Nicoll v. Mumford, 4 Johns. Ch. Rep. 529. Brown v. Minturn, 2 Gall. Rep. 557. Small v. Marwood, 9 B. & Cress. 300. Smith v. Wheeler, 1 Vent. 128. Marbury v. Brooks, 7 Wheaton, 556. Weston v. Barker, 12 Johnson, 276. assignment to trustees

Under the New-York Revised Statutes, such an operates as a grant, and does not require any ex

*534

It is admitted in some of the cases that the debtor may indirectly exert a coercion over the creditors through the influence of hope and fear, by the insertion of a condition to the assignment, that the creditors shall not be entitled to their order of preference, unless within a given and reasonable time (for if no time, or an unreasonable time be prescribed, the deed is fraudulent) they execute a release of their debts, by *becoming parties to the instrument of assignment, containing such a release, or by the execution of a separate deed to that effect. In Jackson v. Lomas, there was a proviso to the assignment, that in case any creditor should not execute the trust deed, which contained, among other things, a release of the debts, by a given day, he should not be entitled to the benefit of the trust deed, and his

press consideration; nor is it necessary to its validity that a creditor should be a party to the conveyance, or signify his assent thereto. Cunningham v. Freeborn, 11 Wendell's Rep. 240. But equity may require the creditors to come in within a reasonable time and signify their assent, or be excluded from all benefit of the trust. Dunch v. Kent, 1 Vern. 260. 319. The assent of trustees would seem to be requisite to the validity of the assignment; for it is assumed to be so in Gordon v. Coolidge, 1 Sumner's Rep. 537, where it was held, that if the assignment in trust for creditors be made to two persons, and one of them accepts the trust, and the other repudiates it, the assignment is operative as to the assenting trustee, unless, it contains some condition rendering the assent of both requisite. The assent of both was, however, to be presumed, unless one of them, upon notice, refuses to accept the trust, and notifies his refusal to the debtor. See, also, the cases supra, in this note, and Neilson v. Blight, 1 Johnson's Cases, 205. Moses v. Murgatroyd, Johns. Ch. Rep. 129.

a

Wharton's Dig. tit. Deed, n. 70. Pierpont & Lord v. Graham, 4 Wash. C. C. Rep. 232. In Halsey v. Whitney, 4 Mason's Rep. 206, six months was held not to be an unreasonable time. The reasonableness of the period of limitations for the creditors to come in, will depend on circumstances.

The King v. Watson, 3 Price's Rep. 6. Lippincott v. Barker, 2 Binney's Rep. 174. Cheever v. Clark, 7 Serg. & Rawle, 510. Scott v. Morris, 9 Ibid. 123. Wilson v. Kneppley, 10 Ibid. 439. Halsey v. Whitney, 4 Mason's Rep. 206. De Caters v. Le Ray de Chaumont, 2 Paige's Rep. 491. The Canal Bank v. Cox, 6 Greenleaf's Rep. 395.

4 Term Rep. 166.

share was to be paid back to the debtor. It seems to have been assumed throughout that case, that such a provision would not affect the validity of the assignment. Whatever might have been the understanding in that case, such a conclusion is not well warranted by the language of many of the American cases, and a deed with such a reservation would, under them, be invalid. The debtor may deprive the creditor, who refuses to accede to his terms, of his preference, and postpone him to all other creditors; but then he will be entitled to be paid out of the residue of the property, if there should be any after all the other creditors who released and complied with the condition of the assignment are satisfied. If the condition of the assignment be, that the share which would otherwise belong to the creditor who should come in and accede to the terms and release, shall, on his refusal or default, be paid back to the debtor, or placed at his disposal by the trustees, it is deemed to be oppressive and fraudulent, and destroys the validity of the assignment, at least against the dissenting creditors. a

a M'Allister v. Marshall, 6 Binney's Rep. 338. Hyslop v. Clarke, 14 Johns. Rep. 458. Seaving v. Brinckerhoff, 5 Johns. Rep. 329. Austin v. Bell, 20 Johns. Rep. 442. Borden v. Sumner, 4 Pick. Rep. 265. lograham v. Wheeler, 6 Conn. Rep. 277. Atkinson v. Jordan, 5 Hammond's Ohio Rep. 294. Lentilhon v. Moffat, 1 Edw. Ch. Rep. 451. Ames v. Blunt, 5 Paige, 16. 18. Graves v. Roy, 13 Louisiana Rep. 457. The brig Watchman, in the district court of Maine, Ware's Rep. 232. In Brashear v. West, 7 Peter's U. S. Rep. 608, the supreme court of the United States were far from being satisfied, that a deed of assignment of all a debtor's property, and excluding from the benefit of its provisions those creditors who should not, within a given time, execute a release of their demands, ought to be sustained. At any rate, a court of chancery, after the preferred creditors were satisfied, would decree the surplus (if any) to those creditors who had not acceded to the deed. In Brown v. Knox, 6 Missouri Rep. 302, (1840,) the supreme court, after able review of the American authorities, considered the point not to be authoritatively settled; and they decided, that an assignment, by a debtor. of all his property to trustees, for the benefit of such creditors as should, within a given time, execute a release, was void. But in Andrews v. Ludlow, 5 VOL. II. 53

*Nor can the debtor in such an assignment, make a reservation, at the expense of his creditors, of any part of his property or income, for his own benefit. It has been supposed that such a reservation, if not made intentionally to delay, hinder and defraud creditors, would not affect the validity of the residue, or main purpose of the assignment; and that if the part of the estate assigned to the creditors should prove insufficient, they might resort to the fund so reserved by the aid of a court of equity. The case of Estwick v. Caillaud,a and the language of other cases, were in favour of this opinion. But later authorities have given to such reservations the more decided effect of rendering fraudulent and

Pick. Rep. 28, such a reservation was held not to render the assignment fraudulent, because it did not appear, in point of fact, to have been inserted with an intention to make a provision for the debtor. And in Halsey v. Whitney, 4 Mason's Rep. 206, the learned judge, under the influence of some of the American authorities, gave effect to the condition annexed to the assignment requiring a release, though the assignment did not purport to convey all the debtor's property; but his own judgment was not satisfied with the authorities under which he acted, and partial assignments with such a condition ought not to be tolerated. In the case of the Watchman, Ware's Rep. 232, the court carries out the general principle so forcibly illustrated in Halsey v. Whitney, and in opposition to what may be considered, after the decision in Borden v. Sumner, 5 Pick. 265, as quite a doubtful point, under the local usages of Massachusetts. In Johnson v. Whitfield, 7 Pick. Rep. 71, it was held, that if a debtor made a partial assignment to select creditors, even for a valuable consideration, it was fraudulent and void, if made with a view to prevent an attachment by other creditors. The case of Havens v. Richardson, 5 N. H. Rep. 113, is on the lax side of the question; for where an insolvent assigned all his property to pay the debts of one or more specified creditors, neither the want of a schedule, or of an estimate of the value of the property assigned, nor a stipulation in the assignment for a release of the debts of those who became parties, nor a reservation of the surplus after payment of the debts of those who assent to the assignment, was considered to be conclusive evidence of fraud. The reservation would now generally, and it ought to be everywhere, fatal to the instrument.

5 Term Rep. 420.

b Riggs v. Murray, 2 Johns. Ch. Rep. 580. S. C. Murray v. Riggs, 15 Johns. Rep. 571. Austin v. Bell, 20 Johns. Rep. 442. Sutherland, J. and Woodworth, J., 5 Cowen's Rep. 547.