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void the whole assignment; and no favoured creditor or grantee can be permitted to avail himself of any advantage over other creditors, under an assignment which, by means of such a reservation, is fraudulent on its face.a These latter decisions contain a just and salutary check of the abuse of the debtor's power of assignment and distribution ; for, as was observed in the case of Riggs v. Murray, b " if an insovent debtor may make sweeping dispositions of his property to select and favourite creditors, yet loaded *with durable and ben- 536* eficial provisions for the debtor himself, and encumbered with onerous and arbitrary conditions and penalties, it would be impossible for courts of justice to uphold credit, or to exact the punctual performance of contracts."c

* Mackie v. Cairns, 1 Hopkins' Rep. 373. 5 Cowen's Rep. 547. Harris v. Sumner, 2 Pick. Rep. 129. Chatres v. Cairns, decided in Louisiana, 1825, and cited in 5 Cowen's Rep. 578. n. Passmore v. Eldridge, 12 Serg. f. Rawle, 198. Gall v. Dibrell, 10 Yerger, 146. The act of Pennsylvania, of 1818, requires voluntary assignments for the benefit of creditors, to be recorded within thirty days.

02 Johns. Ch. Rep. 582.

• In the case of Murray v. Riggs, 15 Johns. Rep. 571, the New York court of errors held a debtor's assignment to be valid, though it in the first place reserved to the use of the grantors, until one year after they should be discharged by law from their debts, two thousand dollars a year, and then gavo preferences, and a power in the assignees to settle with the creditors on certain terms, and that the creditors who did not accept the conditions in one year, or should knowingly embarrass the objects of the deed, should be forever debarred from any share under the assignment. Such a deed was held good, and the decree in chancery setting it aside was reversed! The court of chancery afterwards, in Mackie v. Cairus, 1 Hopkins' Rep. 373, very properly held a deed much less obnoxious than that in Murray v. Riggs, absolutely and in toto fraudulent and void. The last decision appears to have been guided by sound policy and enlightened justice. 5 Cowen, 584, S. C. See also Mead v. Phillips, 1 Sandford's Ch. Rep. 83, a reservation in a voluntary assignment giving preferences, and providing previously for the payment of all costs and expenses necessarily incurred by him in defending suits, was held to be fraudulent. The decision of the court of errors in Murray v. Riggs, may be considered as justly exploded.

X. Of sales at auction.

An auctioneer has not only possession of the goods which he is employed to sell, but he has an interest cou

But the case of Grover v. Wakeman, (11 Wendell'8 Rep. 187. 4 Paige 23. S. C.) on appeal from chancery, goes still further. The case was ably and elaborately discussed in the New-York court of errors, and it was held, in affirmance of the decree in chancery, that a debtor in failing circumstances might, by assignment of his property in trust, prefer one creditor or set of creditors to another, provided he devote the whole of his property as. signed to the payment of his just debts, and the assignment be absolute and unconditional, without any reservation or condition for his benefit, and without extorting from the fears or apprehension of his creditors, or any of them, an absolute discharge, as a consideration for a partial dividend, or making the preferences, or any of them, to depend upon the execution of a release, by such preferred creditors, to him of all claims against him. An assignment giving preferences upon such a condition is void ; and the assignment being void in part as against creditors and the provision of the statute, is void in toto, though there be no fraud in fact intended. This appears to be the most stern decision that exists, either in England or this country, on this subject. See Ames v. Blunt, 5 Paige, 22, and Goodrich v. Downs, 6 Hills N. Y. Rep. 438, to S. P. The weight of general authority, both English and American, is, that an assignment by a debtor of all his property for the payment of his debts, and at the same time giving preferences, and requiring an absolute release from each creditor who accedes, is not per se fraudulent and void. The circumstances of the debtor assigning over to trustees all his property, without any reservation to himself, and giving the surplus, if any, to those creditors, if any, who do not come in and agree to release, on taking their preferred share, is deemed to disarm the transaction of all illegality and unfairness. See the cases collected in Mr. Angell's Laws of Assignments in Trust for Creditors, Boston, 1835, p. 96-108, which is a neat and valuable little manual of the law of vo. luntary assignments by insolvent debtors. A provision in the assignment that the surplus, after all debts are paid, should revert to the debtor, is not improper, for such a resulting trust would follow of course without any stipulation. In Pennsylvania, the judicial decisions were for a time quite lax in favour of voluntary assignments, but their influence was counterac. ted by statute provisions requiring the assignee to give security, and giving to the court power to remove him, and substitute another, and requiring him to file an inventory. The debtor may still give preferences, and require the creditors who accede to execute a general release. The commis. sioners, in their Report on the Civil Code of Pennsylvania, in January, 1835, suggest that this stipulation for a release be placed under some restrictions. Report, p. 50–52. But since that report, and in June, 1836, the legislature of Pennsylvania regulated the voluntary assignments by pled with that possession. He has a special property in the goods and a lien upon them for the charges of the sale, and his commission, and the auction duty. He may sue the buyer for the purchase money, and if he gives credit to the vendee, and makes delivery without payment, it is at his own risk. If the auctioneer has notice that the property he is about to sell does not belong to his principal and he sells notwithstanding the notice, he will be held responsible to the owner for the amount of the sale. So if the auctioneer does not disclose the name of his principal at the time of the sale, the purchaser is entitled to look to him personally for the completion of the contract, and for damages on its non-performance.c

debtors of their estates real or personal, or of any part thereof, in trust for their creditors, or some of them, and so far have given those assignments sanction. Purdon's Digest, 74. In the case of Thomas v. Jenks, decided in the supreme court of Pennsylvania, in March, 1835, the court held the whole assignment fraudulent and void, it being an assigoment by a partnership firm of a part of their property for the benefit of their credit ors, with a stipulation for a release as an equivalent for the assignment. It was such an exercise of the right of preference, as to impose upon the creditors, indirectly, the necessity of resorting to a part of the debtor's property in exclusion of the rest. So, in M Colloch v. Hutchinson, 7 Watts, 434, a voluntary assignment by an insolvent debtor, absolute on its face, to a particular creditor, to pay him and return the surplus to the debtor, was held to be fraudulent and void. The trust was secret and the deed deceptive. The judicial decisions on this subject reom at last to have taken a firm and vigorous stand in favour of the rights of creditors and the claims of justice. The case of Van Nest v. Yoe, before the assistant V. Ch. in New York, (1 Sandford's Ch. Rep. 1.) contains a stringent and sound application of principles against the delay of creditors, by a voluntary assignment of his property by a debtor to retain and hinder the operation of executions at law. Though the law allows of voluntary assignmonts, and permits the insolvent debtor to select his own assignees, yet where he selected his own relatives of very apparent incapacity for tho trust, it was held to be evidence of fraud, and the assignment was set aside. Cram v. Mitchell, 1 Sandford's Ch. Rep. 251. S. P.

• Williams v. Millington, 1 H. Black's Rep. 81. b Hardacre v. Stewart, 5 Esp. N. P. Rep. 103. c Hanson v. Roberdeau, Peak's Rep. 120.

*In the sale of real property at auction care should be taken that the description of it be accurate, or the purchaser will not be held to a performance of the contract. But if the description be substantially true, and be defective or inaccurate in a slight degree only, the purchaser will be required to perform the contract if the sale be fair and the title good. Some care and diligence must be exacted of the purchaser. If every nice and critical objection be admissible, and sufficient to defeat the sale, it would greatly impair the efficacy and value of public judicial sales; and, therefore, if the purchaser gets substantially the thing for which he bargained, he may generally be held to abide by the purchase, with the allowance of some deduction from the price by way of compensation for any small deficiency in the value by reason of the variation.a

A bidding at an auction may be retracted before the hammer is down. Every bidding is nothing more than an offer on one side, which is not binding on either side until it is assented to, and that assent is signified on the part of the seller by knocking down the hammer.b

If the owner employs puffers to bid for him at an auction, it has been held to be a fraud upon the real bidders. He must not enhance the price by a person privately employed by him for that purpose. It would be contrary to good faith, as persons resort to an auction under a confidence that the articles set up for sale will be disposed of to the highest real bidder. A secret puffer employed by the owner is not fair bidding, and is a fraud upon the public; nor can the owner privately bid upon his own goods. All secret dealing on the part of the seller is deemed fraudulent. If he be unwilling that his goods should be sold at an under price, he may order them to be set up at his own price, and not lower, or he may pre

a Calcraft v. Roebuck, 1 Vesey, jun. 221. Dyer v. Hargrave, 10 Vesey, 505. King v. Bardeau, 6 Johns. Ch. Rep. 38.

• Payne v. Cave, 3 Term Rep. 148.

viously declare, as a condition of the sale, that he reserves a bid for himself. *This was the doc- *538 trine declared by Lord Mansfield in Bezwell v. Christie,a and again, by Lord Kenyon, in Howard v. Castle,b and in each case with the approbation of the court of K. B. The governing principle was that the buyer should not be deceived by any secret man@uvre of the seller. But the doctrine of those cases has since been considered as laid down rather too broadly. Lord Rosslyn and Sir William Grant have each questioned the soundness of the doctrine. The latter seemed to think, that if bidders were employed by the owner merely for the purpose of taking advantage of the eagerness of them to screw up and enhance the price, it would be a fraud; but that he might lawfully, even without making the fact publicly known, employ a person to bid for defensive precaution, and with a view to prevent a sale at an under value. This relaxation of the former rule was also approved of in Steele v. Ellmaker;d and the chief justice, in that case, suggested, that the tone of Lord Mansfield's morality was, perhaps, too lofty for the common transactions of business. He held, that the owner might lawfully instruct the auctioneer to bid in the goods for him at a limited price, to prevent a sacrifice. In Bramley v. Alt, it was held, that a sale was not fraud ulent because a puffer had been employed, if there were real bidders who bid after the puffers had ceased; and in Smith v. Clarke, a specific performance was decreed against a vendee, though the person who bid immediately before him was employed to bid, under the private direction of the vendor, for the purpose of preventing a sale under a specified sum.f

2

Cowp. Rep. 395. b 6 Term Rep. 612. Thornett v. Haines, Exch. 1846, S. P. • Condly v. Parsons, 3 Vesey, 625. n. Smith v. Clarke, 12 Ibid. 477. d 11 Serg. & Rawle, 86. • 3 Vesey, 620. Woodward y. Miller, 1 Collier Rep. 279, S. P.

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