Galle v. Tode — 38 N.Y. St. Rep. 862

Majority

p. 862

Samuel Galle, Resp’t, v. Adolphe Tode et al., App’lts.

(Supreme Court, General Term, First Department,

Filed May 15, 1891.)

Headnote

Creditor’s action—General creditors cannot maintain.

General creditors of a firm cannot maintain an action, in aid of an attachment, in which they seek to have confessions of judgments made by a firm declared fraudulent.

p. 863

Appeal from order denying injunction to restrain the defendants from enforcing judgments and execution thereupon issued.

E. J. Myers, for app’lts; A. J. Simpson, for resp’t.

The plaintiffs are attaching creditors of the defendants Tode & Wulling, and certain other defendants, are judgment creditors by confession of the defendants Tode & Wulling, upon which executions had been issued to the defendants, the sheriffs of the counties of New York and Orange.

The plaintiffs alleging said confessions to be fraudulent have brought this action in aid of their attachment, seeking to have the said confessions and judgments declared fraudulent, and to have the sheriffs aforesaid restrained from proceeding under the executions above mentioned; and asking that the defendants account to the receiver, and when a judgment shall have been recovered by the plaintiffs against the defendants Tode & Wulling in the action in which the attachment is granted, that it be first paid out of the assets, property and effects of said defendants Tode & Wulling. In other words, the plaintiffs have brought a creditor’s bill to set aside these confessions of judgment upon the ground of fraud, and to reach the property which has been levied upon under the executions issued upon said confessions, being simply creditors at large having no judgment or execution returned unsatisfied.

That such an action cannot be maintained has been the law in this state certainly ever since the case of McElwain v. Willis, 9 Wend., 549 . It was recognized in the cases of Adsit v. Butler, 87 N. Y., 585 ; Adee v. Bigler, 81 id., 349 ; Carpenter v. Osborn, 102 id., 558; 2 N. Y. State Rep., 520, and Clafiin v. Gordon, 39 Hun, 54 . The case of Thurber v. Blanck, 50 N. Y., 80 , is a direct authority against the claim of the plaintiff.

' The plaintiffs, therefore, are not in a position to maintain this action for equitable relief, and the order continuing the injunction must be reversed, and the motion denied; but in view of the fact that the point was not raised in the court below, or even suggested, and, as far as we have been able to discover, not made upon the brief submitted upon this appeal, the reversal should be without costs.

The agree to the reversal of the order from which the appeal has been brought The injunction is not sustained, even by the case of Bates v. Plonsky, 28 Hun, 112 , whose chief design was to restrain the execution creditors from taking the proceeds of the sales of the attached property under executions which had been issued on the judgments attacked as fraudulent, until the right to such proceeds could be determined by action.