Adams v. Henry — 22 Abb. N. Cas. 385

Majority

p. 385

ADAMS v. HENRY.

N. Y. City Court, Trial Term ;

February, 1889.

Headnote

Assignment for creditors-, reconveyance by assignee.] The legality of a re-assignment- of a debt to the assignor, made by an assignee for creditors who has not filed a bond, cannot, be questioned by the debtor.

Trial by jury.

Samuel Adams aud James Mclvor sued Jacob Herrielc Henry for goods sold and delivered.

The complaint alleged in substance that Samuel and Charlotte Adams, James Mclvor aud Thomas Allen were copartners under the firm name and style of Adams, Mclvor & Allen, and sold goods to the defendant, for which payment had been demanded and refused; that thereafter the firm of Adams, Mclvor & Allen dissolved; that the plaintiffs succeeded to the business, and there was duly assigned to them the property, estate and effects of said copartnership, including their claim and demand against the defendant.

The defendant admitted the sale and delivery of the goods, but denied that there ever existed any contract or obligation between him and the plaintiffs, “ nor has any transaction of any sort whatsoever been had, so far as defendant is informed and believes, by reason whereof the plaintiffs can or may have a claim against defendant.”

It appeared upon thé trial that the firm of Adams, Mclvor & Allen had made an assignment for the benefit of creditors to William B. Roe. That before the assignee had filed his official bond Charlotte Adams and Thomas Allen joined with the assignee, as such and individually, in a re-transfer of the assigned estate to the plaintiffs, the retransfer reciting the assignment to the assignee; and that a compro

p. 386

mise with the creditors of the firm was satisfactorily effected, and that the creditors agreed to the retransfer. There was no other evidence, however, of the acquiescence of the creditors in the retransfer.

The defendant moved to dismiss the complaint on the ground that the title to the claim was not properly in the plaintiffs, and that they could not sue thereon; with the further objection that the assignee had no right before filing his official bond to make the reconveyance.

The motion to dismiss the complaint was denied and a verdict for the plaintiffs was directed.

Joknes c& Wilcox, for the plaintiffs.

J. H. Henry, defendant in person.

The assignee for the benefit of creditors failed to give the official bond required by law, and thereafter joined with his assignors in making a new assignment to the plaintiffs. This transfer vested in them good title to the claim in suit (Juliand v. Rathbone, 39 N. Y. at p. 375). Its legality cannot be questioned by the debtor, for the payment by him to the plaintiffs will furnish him ample protection. It can be questioned only by the successor in trust or by the creditors of the original assignors for whose benefit the bond is intended (Woodworth v. Seymour, 22 Hun, at p. 248). This rule is particularly applicable here in view of the fact that the original assignors compromised with their creditors, so as to make the execution of the trust created for their benefit unnecessary, and the evident purpose of the new assignment was in aid of the compromise. There is no one left to attack the transfer, and the plaintiffs are entitled to judgment.