Crosbie v. Leary — 19 N.Y. Super. Ct. 312

Majority

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Robert Crosbie et al., Plaintiffs and Respondents, v. Arthur Leary, Defendant and Appellant.

Headnote

1. The agent in this country of a merchant in Liverpool, was notified of the assignment hy his principal of all his estate to the plaintiffs, in proceedings in bankruptcy, in trust for the benefit of creditors. The assignees continued ■ to employ the same agent in effecting insurance on property, and receiving and collecting moneys forming part of the assigned estate, and he performed those services for them, and therein he received payment of all that was due to him by the bankrupt at the date of the assignment. In an action by bis principals to recover from him further moneys received by him, such agent cannot prove as a defense that the assignment was fraudulent and void, as to the creditors of the bankrupt, nor insist upon such fact as a defense, although the assignment appear on its face to contain provisions which render it illegal and void as to such creditors. Nor is it any excuse to him for not paying over the money, property and choses in action in his hands that the assignment, though prepared to be signed by all the creditors of the bankrupt, was only signed by the assignor, assignees and a portion of the creditors.

2. Such an agent cannot in such an action setoff, against the plaintiff’s claim, debts due to him by the bankrupt, arising after such assignment was made.

3. In an action to compel an agent to account and pay over moneys received, and to deliver up the securities or choses in action not then collected, if an accounting be directed it is proper to include therein and give judgment for any moneys received by the agent, (by collection of the securities,) down to tire time of stating the account, though collected after suit brought.

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4. It is not error to reject evidence offered by a defendant which contradicts the defendant’s admissions in his answer.

5. When a defendant alleges that a bill of exchange drawn by him, in favor of a payee named therein, was lent to such payee for his accommodation, and claims the amount as a charge against the payee, the burden of proof is on such drawer to prove the want of consideration, otherwise the legal presumption is that it was given for money due to the payee.

6. The declarations of a defendant are not evidence in his own favor, unless the plaintiff by giving in evidence a part of his statements, or facts raising some presumption from his apparent silence has made the declarations admissible as part of the conversation, or as a reply to the circumstances out of which such presumption arises.

(Before Hoffman and Woodruff, J. J.)

Heard, November 17th, 1859;

decided, March 10th, 1860.

Appeal by the defendant from a judgment against him for $18,397.85, damages and costs, and that he deliver and assign to the plaintiffs certain policies of insurance and documents relating thereto, which was rendered on the decision of William Kent, Esq., Referee, before whom the action was tried.

The action is brought by the plaintiffs, who are the assignees of one Edward Oliver, under an assignment of his property, made in England, October 7,1854, to recover a balance of account rendered to the plaintiffs by the defendant, who, prior to the assignment, was agent for the said Oliver in effecting insurances, and was thereafter employed by the plaintiffs, and also moneys collected by him since the account was rendered, and for an accounting respecting his receipts and collections for them, and also to compel him to assign and deliver to them the policies of insurance effected by him as their agent, and all vouchers and documents relating thereto.

The answer of the defendant admitted that he had been, prior to October 7, 1854, the agent of Edward Oliver in effecting insurances on ships and vessels of the said Oliver; denied the assignment by Oliver to the plaintiffs, and their employment of the defendant; admits he, at the request of Oliver, sent an account to H. B. & Co., of Liverpool, agents of the plaintiffs, but such account did not embrace all the unsettled accounts between him and Oliver; that, prior to October 7, 1854, he advanced, by way of loan, to Oliver, and without consideration, a bill of exchange for £4,132 5s. 5d. sterling, which Oliver, after he had become

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insolvent, and after he and his agents were forbidden by defendant to negotiate it, they did pass it away, and suit is now pending thereon against defendant by other parties claiming to be holders for value, by reason whereof Oliver is indebted to the defendant for the amount; that he is not indebted to Oliver or the plaintiffs, but a balance will be found due to him, on an adjustment of the accounts, of more than $10,000. By a further answer, the defendant alleged that Oliver is indebted to him for moneys paid and liabilities incurred, to the amount of $100,000, and that the pretended assignment to the plaintiffs is fraudulent and void as to him. .

The report of the Referee states the facts found, and his conclusions of law thereon, as follows:

“ I, the undersigned Referee, appointed by this Court to hear and determine the action, do report—

“ That I have been attended by the counsel of the respective parties, and have heard their proofs and allegations; and I do find and report as follows:

“ That the defendant was, previous to the 7th of October, 1854, employed by Edward Oliver, of Liverpool, as an insurance agent, at the city of New York, and in that character effected marine insurances in different insurance companies in the United States, on the ships and vessels of the said Edward Oliver; that, on the 7th of October, in the year 1854, by a certain deed of assignment, bearing that date, the said Edward Oliver transferred and assigned to the plaintiff, for the benefit of his creditors, all the estate and effects of the said Edward Oliver, including all the said policies of insurance, and all sums of money due and to become due thereon.

“ That, immediately after the said assignment, the plaintiffs entered upon the execution of the duties thereof, of which the defendant was notified, and they continued to employ the said defendant in receiving and collecting the sums secured or payable under the said policies of insurance, and in effecting further insurances on the ships and vessels so assigned to them, which, the defendant undertook to do, and to account to them for the proceeds.

“ That, previous to the 9th of September, 1856, the said Arthur Leary had been,, by and in the course of said business, fully

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repaid all the advances, charges and commissions due him upon, or by reason of, the said insurances so made, including the insurances made by him since the date of the said assignment, for the said assignees; and on the said 9th of September, 1856, he rendered to the said assignees his account current, showing a balance payable to them, as such assignees, over and above all disbursements and charges, of four thousand six hundred and sixty-nine dollars and twenty-five cents, amounting, with interest, to the date of this report, to five thousand five hundred and twenty-three dollars and fifty-four cents.

“ That between the date of said account and the commencement of this suit, the said Arthur Leary had made further collections on the said policies of insurance, to the amount of eight thousand one hundred and fourteen dollars and ninety cents, over and above charges and commissions, amounting, with interest to the date of this report, to nine thousand five hundred and sixty-four dollars and seventeen cents. And that subsequent to the commencement of this suit, and prior to the 3d of June, 1858, the said Arthur Leary has made further collections on the said policies to the amount of two thousand five hundred and fifty-one dollars and fifty-eight cents, amounting, with interest to the date of this report, to the sum of two thousand six hundred and ninety-three dollars and ninety-seven cents, which amounts remain due to the plaintiffs.

“ That prior to the commencement of this suit, the plaintiffs had requested the said defendant to account with and pay over to them the amount so recovered and collected on account of the said policies and proofs appertaining thereto, which the defendant neglected and refused to do.

The plaintiffs’ counsel produced at the trial, and offered to cancel and surrender the dishonored bill of A. Leary, for four thousand one hundred and thirty-two pounds five shillings and five pence, in favor of Edward Oliver, in the answer mentioned, and offered to the defendant’s counsel therewith, the consent of the plaintiffs’ attorney in the suit thereon, that the .same be discontinued.

“ I further find, that no evidence (besides the bill itself) was offered as to the consideration or purpose for which said bill was remitted to said Oliver.

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“That the defendant appeared in said suit on said bill by his attorney, but that the cause was not put at issue, and that, in February, 1855, the plaintiffs gave notice tó the defendant that no further proceedings would be had in the suit on said bill, but that the suit was not discontinued of record, nor the costs paid up to the time of the said offer of the plaintiffs’ attorney herein.

“ And I therefore find, as conclusions of law, that the deed of assignment of October 7th, 1854, took effect as an absolute and valid transfer to the plaintiffs of the claims and policies of insurance on the ships of the said Oliver, as between the parties, subject only to any existing charges of the defendant for his advances and commissions thereon, and that upon the repayment to the defendant of such charges and commissions, the plaintiffs become absolutely entitled thereto.

“ That the defendant, having assented to the said assignment and continued to act in the employment of the assignees in the business of the assigned estate, was liable on his promise to account to them for his collections.

“ That the transactions of the defendant with Edward Oliver since the date and notice of the assignment or judgments against him, arising out of such subsequent transactions, were not admissible in evidence as against the plaintiffs.

“ That the dishonored bill of the defendant in favor of Edward Oliver, for four thousand one hundred and thirty-two pounds five shillings and five pence, was not available by the defendant as a defense against the plaintiffs’ claim in this suit.

“ And 1 do therefore find that the plaintiffs are entitled to judgment against the defendant for the sum of seventeen thousand seven hundred and eighty-one dollars sixty-eight cents, the amount so due as aforesaid, including interest, together with the costs of this action, to be taxed.

“And that said judgment should further provide and require that the defendant deliver to the plaintiffs, or their attorney herein, all policies of insurance effected by defendant on the vessels of Edward Oliver, or effected for and at the request of the plaintiffs, together with all protests, vouchers and documents pertaining thereto.”

The assignment by Edward Oliver, of Liverpool, England, to the plaintiffs, in trust, for the benefit of his creditors, dated

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October 7, 1854, made in certain proceedings in bankruptcy, in England, to the plaintiffs, as parties to the second part, and to which those of Oliver’s creditors who signed it were described as parties of the third part, named in a schedule of creditors annexed, was produced; its execution by the parties of the first and second parts had been duly proved by the subscribing witness, and certified before the American Consul at Liverpool, and the signature of the other witness to the execution by the same parties was proved on the trial. It purported to be signed and sealed by the creditors named in the list, and the proof of the signatures of several, but not of all of them was given. The reading of the assignment was objected to, the objection overruled, and defendant excepted. It is not necessary to state the provisions of the assignment. The defendant claimed that it was fraudulent and void by reason of various provisions therein, which, on the other hand, the plaintiffs insisted were legal under the laws of England, which, however, were not produced or proved. The Court did not pass upon the question, whether it was valid or not, as against judgment creditors of Oliver.

The defendant’s motion for a nonsuit, urged on the grounds that the plaintiffs being foreign assignees, could not sue here, nor in their own names, and that the assignment was void, was overruled, and he excepted.

The defendant offered to prove by Edward Oliver, various facts tending to show that the assignment by him was fraudulent and void as against creditors, and to the rejection of the testimony, defendant excepted.

The defendant offered a judgment record, letters and other evidence, showing that since the assignment by Edward Oliver to the plaintiffs, he (Oliver) had become largely indebted to the defendant. To the rejection of this evidence, the defendant excepted. He also offered evidence to show that the credits to the plaintiffs in the account rendered by him, on the 9th September, 1856, were in part made up of notes therein credited as cash, and that such notes had in fact never been paid to him. To the rejection of this evidence he excepted. He also inquired of the plaintiffs’ witness, Foster, (who had testified that he notified the defendant of the assignment by Oliver to the plaintiffs, and requested him to furnish accounts and statements of any

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property or assets of Oliver in his hands.) What the defendant replied, when he, the witness, demanded of the defendant any policies or documents belonging to Edward Oliver ? On objection, the question was disallowed, and defendant excepted.

The plaintiffs produced on the trial and offered to cancel the bill of exchange described in the defendant’s answer, and a written consent of the attorneys in the suit thereon, that such suit be discontinued. The defendant’s counsel objected to and declined the offer, because no actual discontinuance* had taken place, no costs had been paid, and that the defendant could not now be deprived of his defense.

The defendant took due exceptions to the findings and decision of the Referee.

C. C. Egan, for the defendant (appellant).

This action is brought by the plaintiffs, as assignees, under a statutory assignment executed in England, all parties to it residing there. As such assignees the plaintiffs cannot sue here.

Because they have no standing in Court, by right, and are not permitted to have by courtesy, especially as the interests of the defendant, a citizen, are injuriously affected by such suit. (Willink v. Renwick, 23 Wend., 63 , and cases cited; 20 John., 346 ; Hoyt v Thompson, 1 Seld., 346, Opinion of Paige. As to statutory assignment, see 12 and 13 Vict., chap. 106, § —.)

The plaintiffs cannot maintain this action in their own name.

Because a right to sue (chose in action) cannot, by English law, be transferred by assignment. (Sewell v. Moxsy, 12 Eng. Law & Eq. R., 304; Scholey v. Daniel, 2 Bos. & Pull., 541; Coke’s Litt., 14, a, note; 2d Bl. Com., 442; Edwards on Bills, 55.)

Because, by the terms of the assignment, they are provisional assignees only, and have not shown a compliance with the conditions of the assignment from which alone they derive power to bring this action.

Because the execution of the assignment by the assignor, was in itself an act of bankruptcy, without proof of the compliance with the statute. (12 and 13 Vict., ch. 106, § 68.)

And it appears by the certificate annexed to the assignment, that proceedings were taken against the assignor in the court of bankruptcy, and in the absence of proof to the contrarjq on the

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part of the plaintiffs, this Court is to assume that the assignor’s estate became subject to the Bankrupt Court, and that official assignees were appointed superseding the plaintiffs.

The assignment was improperly admitted in evidence, because there was no proof of the execution thereof by all the parties of the third part thereto.

The assignment is void as against the defendant, who was a creditor of the assignor at the time of the execution thereof.

The fact of the defendant being a creditor at that time is not disputed. (3 R. S., 5th ed., p. 221, § 1; 4 Comst., 211.)

The laws of a foreign country are presumed to be the same as ours, unless the contrary is shown. (Wright v. Delafield, 23 Barb., 498 ; Monroe v. Douglass, 1 Seld., 448.)

The assignment is void against a subsequent creditor of the assignor under section 1, page 221, 3 Revised Statutes, 5th edition, which is as follows:

“All deeds of gift, all conveyances, and all transfers or assignments, verbal or written, of goods, chattels, or things in action, made in trust for the use of the person making the same shall be void, as against the creditors existing or subsequent of such person.”

A surplus is contemplated by the assignment, which is made in trust for the assignor. (Leitch v. Hollister, 4 Comst., 211; Van Nest v. Yoe, 1 Sandf. Ch. R., 4; McLean v. Button, 19 Barb., 450 ; Barney v. Griffin, 2 Comst., 365; Goodrich v. Downs, 6 Hill, 438 ; Mackie v. Cairns, 5 Cow., 547 ; Fiedler v. Day, 2 Sandf., 594 ; 2 Seld., 510, 522; 12 Barb., 168 ; 19 id., 450; 17 id., 301.)

It is sufficient that the defendant is a simple contract creditor. It is only necessary to be a judgment creditor where it is sought to set aside the assignment for fraud by direct suit, in order to get the assignees before the Court.

Here they come voluntarily into Court.

The assignment is void against a subsequent creditor of the assignor.

Because it authorizes a sale of the assigned property upon credit. (2 Seld., 510, 522.)

Because, while proposing to assign all the property of the assignor for the benefit of creditors, it reserves a part thereof to the assignor. (Curtis v. Leavitt, 15 N. Y. R., 144.)

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Because it allows the assignees to purchase the assigned property.

Because it exonerates the assignees from all liability in the management of the assigned estate arising from their own acts. (Litchfield v. White, 3 Seld., 438.)

Because it provides a compensation to the assignor and his family. (McLean v. Button, 19 Barb., 450 .)

Because it allows the assignor to retain the use of the assigned property.

If the defendant is a creditor of the assignor subsequent to the assignment, then for the above reasons the assignment is void as to him, and the Referee erred in excluding the proof of the indebtedness of the assignor to the defendant existing at the commencement of this action.

For the same reason the Referee erred in rejecting the certified copy of the judgment roll, of a judgment in favor of the defendant against the assignor for $12,655.98.

For same reason the Referee erred in rejecting the transcript of judgment in favor of the defendant against the assignor for $14,695.74. (1 R. S., 5th ed., p. 868, §121; 3 id., p. 545, § 282; id., 639, § 13.)

To entitle the plaintiffs to recover, they must show that the assignment is valid and authorized by the laws of England, where made. (Thatcher v. Morris, 1 Kern., 437.)

The illegality of the transaction through which the plaintiffs derive their title as assignees, is a defense to the defendant. (Dewitt v. Brisbane, 16 N. Y. R., 513; Johnson v. Bush, 3 Barb. Ch. R., 207; Talmage v. Pell, 3 Seld., 328; Green v. Seymour, 3 Sand. Ch. R., 285; Leavitt v. Palmer, 3 Comst., 19; Story on Prom. Notes, § 193; Merchants' Bank v. Spalding, 5 Seld., 52; Hyde v. Goodnow, 3 Comst., 266; Nellis v. Clark, 4 Hill, 424 ; Babcock v. Booth, 2 Hill, 181 ; Bolt v. Rogers, 3 Paige, 154.)

The Referee erred in denying the motion for nonsuit.

The Referee erred in excluding the testimony of Edward Oliver, offered on the trial.

An assignor of a deed in trust, for creditors, is a competent witness for a creditor seeking to avoid the deed or assignment for fraud. (Seymour v. Wilson, 14 N. Y. R., 567; 11 Wend., 241 ; 3 R. S., 5th ed., pp. 224, 225, §§ 1, 4.)

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The Referee erred in not allowing the witness Foster to answer the question put by defendant’s counsel.

When you demanded of the defendant any policies or documents belonging to Edward Oliver, what reply did he make to that demand?

The Referee erred, in not allowing the defendant to show the admission of De Wolfe, one of the plaintiffs, as to the invalidity of the assignment.

The Referee erred, in allowing the plaintiffs’ counsel to withdraw the objection to the examination of Edward Oliver, as a witness.

The Referee erred, in refusing defendant’s motion to strike out the withdrawal of the objection to the examination of Oliver.

The Referee erred, in rejecting the proof offered by the defendant that the notes of various parties were credited as so much cash in the account rendered by the defendant, and that such notes have never been paid to the defendant.

The suit pending against the defendant by the Liverpool Borough Bank, upon the bill for £4,132 5s. 5d. remitted to E. Oliver, and by him passed to said Bank, was a defense to the defendant in this action.

The Referee erred, in allowing the offer of the plaintiffs’ counsel to cancel and surrender the bill of £4,132 5s. 5d., and to deliver to defendant’s counsel a consent for the discontinuance of the suit against the defendant upon such bill.

Because the suit upon such bill has not been discontinued.

No order of discontinuance has ever been entered, filed or served therein.

No costs in such suit have ever been paid or tendered.

No costs in this action had then or ever have been paid or tendered in this action.

Such offer made at that stage of this action without the payment or tender of the defendant’s costs herein, up to the time of such offer, cannot deprive the defendant of a defense valid and effectual at the time this action was commenced and set up in the answer.

The Referee erred, in allowing to the plaintiffs the amount of the notes, and the interest therefrom from September 9th, 1856,

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received by the defendant, and credited in his account as so much cash, which remain unpaid by the makers thereof, viz.: H. T. Chambers, $148.25 ; Vallance & Berlley, $300; Fisher & Milliken, $501.25; John M. Mayo & Company, $801.25.

The Referee erred, in allowing to the plaintiffs any amounts received by defendant after the commencement of this action, which by his report appears to be the sum of $2,693.97.

The objection to the introduction of the letters, of defendant, to Harmood, Banner & Company, was well taken.

The Referee erred, in rejecting the letters of Edward Oliver offered by the defendant.

The judgment should be reversed, with costs.

Joshua Coit, for the plaintiffs (respondents).

I. The execution of the assignment by Edward Oliver, and

by assignees, is duly proved by the subscribing witness before the American Consul. (1 R. S., § 4, ¶ 2; Laws of 1829, ch. 222.)

II. The execution of the assignment by several of the creditors, if that is considered necessary, is proved by the witnesses. (Burrill on Assignments, pp. 310, 315; Harris v. Sumner, 2 Pick., 129 ; Hastings v. Baldwin, 17 Mass., 552 , 556.)

III. The assignment operates as an actual transfer of the claims, debts, and policies of insurance of Oliver, as between the parties. It cannot be impeached by a debtor or a holder of the securities assigned. Nor by a creditor until he has recovered a judgment against the assignor, and had an execution returned. (Bishop v. Halsey, 13 How. Pr. R., 154; Waterbury v. Westervelt, 5 Seld., 598, 605; Hastings v. Belknap, 1 Denio, 190 , 198.)

IV. The provisions of the English bankrupt act of 1849, making certain provisions in relation to arrangements by deed, (§§ 224-229,) relied on by the defendant have no bearing on this case. These provisions are analogous to our “ two-thirds act,” and provide for an absolute discharge of the debtor from all his debts, on obtaining the assent of six-sevenths of his creditors, and complying with certain other provisions of the act.

Whether these have or have not been complied with is immaterial here. (Drew v. Collins, 4 Eng. Law & Eq., 540; [contains the clauses of the act in question;] Tetley v. Taylor, 8 id., 370;

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S. C., 12 id., 469; Stewart v. Collin, 10 Com. Bench, [J. Scott], R., 70 E. C. L R., 634.)

The assignment was valid by the laws of England. (Pickstock v. Lyster, 3 Maule & Sel., 371; Janes v. Whitbread, 5 Eng. Law & Eq., 431; Coate v. Williams, 9 id., 481; Curtis v. Leavitt, 15 N. Y. R., [1 Smith,] 9, 114, 295.)

V. The assignment was assented to by the defendant, and has continued to be acted upon him till the commencement of this suit.

1. An assignment cannot be impeached by a creditor assenting to it, and acting under it. (Burrill on Assignments, p. 317, and cases cited; Henriquez v. Hone, 2 Edw. Ch. R., 120; 13 Wend., 240 .)

2. Not only has the defendant assented to the assignment, but he has continued to be employed by the assignees as their agent in effecting the insurances and making the collections in question.

3. The whole amount now claimed is a balance of a new account opened with the assignees, and is less than the amount directly advanced the defendant by the plaintiffs in the course of the agency. (Story on Agency, §§ 54, 55.)

VI. The dishonored bill of Leary set up in the answer is no evidence of a debt due by Oliver.

The presumption in the absence of proof, is that it was given for an amount due by the drawer.

In any event, it is sufficient that the plaintiff produces the bill at the trial, or shows it in his possession. (Chit, on Bills, p. 197, 9th Am. ed., and cases cited.)

VII The accounts rendered the plaintiffs taken in connection with the correspondence, are conclusive that the defendant was indebted to the plaintiffs, in the amount claimed, at the time of the bringing of the suit. (1 Story’s Eq., § 526; Bruen v. Hone, 2 Barb. S. C. R., 586; Leaycraft v. Dempsey, 15 Wend., 83 .)

VIII. The judgment by default of February 12,1859, against Edward Oliver and James Henry, is no defense to the claims of the defendants, and was properly excluded by the Referee. It is between different parties. (1 Cow. & Hill, Phil. on Ev., 326.)

It was obtained pending the trial of the cause before the Referee.

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It appears on its face to have grown out of transactions long subsequent to the assignment of Oliver and to the defendant’s assent thereto. (Code, § 112; Beckwith v. Union Bank, 4 Sand., 604.)

The transcript from the docket, of March 17, 1859, is no evidence in itself. It is only made by statute authority to the county clerk to docket the judgment so as to bind the real estate of the defendant. (2 R. S., p. 361, § 18, ch. 386 of 1840, § 26.)

IX. The plaintiffs are entitled to recover:

1. The amounts stated in the account of September 9, 1856.

2. The subsequent collections to date of report, with interest, respectively.

3. The delivery of the policies and documents.

The Code, section 167, authorizes the joinder of an equitable, with a legal cause of action.

The complaint prays an account against an agent.

Where accounts are ordered to be brought in, they are to be stated up to the time of filing. (1 Barb. Pr., 506 to 508; Seaton’s Decrees, p. 42; Bell v. Read, 3 Atk., 592; id., 582.)

The judgment should be affirmed.

The Referee finds in this case that down to and prior to the 7th of October, 1854, the defendant was employed by one Edward Oliver as an insurance agent, and that in that character he effected marine insurances in various companies on ships and vessels of the said Oliver.

That on the 7th of October, 1854, the said Oliver assigned all his estate (including the policies for the said insurances, and all moneys due or to become due thereon,) to the plaintiffs for the benefit of his creditors.

That the defendant was immediately notified of the assignment, and the plaintiffs entered upon the execution thereof, and they continued to employ him in receiving and collecting the sums payable by virtue of the said insurances, and also in effecting further insurances on the ships and vessels assigned, and that the defendant undertook to do this, and to account to them for the proceeds.

That prior to September 9th, 1856, the defendant had been repaid all his advances made to Oliver prior to such assignment,

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and all his advances made in his said employment by the plaintiffs, and on that day rendered them an account, showing a balance due to the plaintiffs of $4,669.25, over and above all charges.

That subsequently and prior to the commencement of this suit, he had made farther collections on the said policies of insurance to the amount of $8,114.90, over and above all charges and commissions.

That after the commencement of this suit and before the accounting had before the Referee, the defendant had made further collections on the said policies to the amount of $2,551.18.

These sums, with interest, the Referee reported due to the plaintiffs, and for the amount so found due, the judgment was entered from which the appeal was taken.

It is not insisted that the facts so found are not warranted by the evidence. If such claim were made, we should be constrained to say that in our judgment the proofs fully sustain the findings of the Referee in these respects.

Two main objections are urged to the recovery upon the facts proved: First, that the assignment by Edward Oliver was fraudulent and void by reason of provisions which, on its face, render it illegal; and second, that the plaintiffs cannot recover in this action for moneys collected after the action was commenced.

1. The complaint alleges the dealings between Oliver and the defendant. The assignment by Oliver; the continued employment of the defendant, Leary, by the plaintiffs; his receipt of moneys and his rendering the accounts on the 9th of September, 1856, showing the balance due to the plaintiffs of $4,669.25; his continued possession of the policies of insurance; further collections thereon; his refusal to render an account thereof; the plaintiffs demand of the outstanding policies, &c. And the. complaint prays an account of all his acts and of all moneys received, and that he pay over all moneys due, and give up the policies of insurance, with the proofs, vouchers and documents relating thereto.

The answer simply denies that Oliver assigned to the plaintiffs, or that the plaintiffs continued to employ him, but admits that

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he continued to make collections till he had repaid himself the moneys he had expended for Oliver prior to October 7, 1854.

The defendant also admits that he rendered the account of September 9, 1856, which was an account of certain collections of money: that, by the account, it nominally appeared that the sum stated as the balance thereof, $4,669.25, was due by the defendant, but alleges that that sum was not in reality due, because it did not embrace all the open and unsettled transactions between him and Oliver. That, prior to October 7, 1854, the defendant had remitted to Oliver a draft for £4,132 5s. 5d. sterling, which was without consideration, and was a loan to Oliver, which draft Oliver and the parties having the management of his estate after his failure, and notwithstanding notice from the defendant prohibiting the same, negotiated and received the amount thereof, and parties claiming to be holders thereof for value are now prosecuting a suit thereon against the defendant.

The defendant, also, by an amendment, called a further answer, set up that Edward Oliver, on the 7th of October, 1854, was indebted to the defendant for moneys paid out, &c., in $100,000, which has not been paid.

Taking the facts found by the Referee to be true, here is an endeavor by an agent, who has been paid in full all claims due to him by his principal, accepting employment by the assignees of such principal, continuing to manage the business as their agent and collecting moneys, but, when called to account, alleging that the assignment is void as against the creditors of the assignor, (for it is this only which is claimed of the assignment in question,) and refusing, on that ground, to account to his actual employers, or to pay over moneys received by their direction.

This, we think, he cannot do. It is his business to pay over the moneys he has received, and it will be the plaintiffs’ duty to answer, if any creditor of Edward Oliver should impeach the assignment, for the property which comes to their hands, whether through the agency of this defendant or otherwise.

So that we do not deem it necessary to discuss the question whether the assignment is, or is not, valid as against the creditors of Edward Oliver. Under the English statutes referred to, we incline to think it is perfectly valid and binding; and, if so, then the whole pretense is groundless.

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The assignment was clearly valid as between the parties to it. The assignor is bound thereby: his agent cannot impeach it.

It is not denied in the answer that the defendant had actually received all the moneys which appear by the account rendered September 9, 1856, to have been received by him. The answer admits that he had collected and paid himself all moneys which he had expended for Edward Oliver prior to the assignment, and all moneys which he had been obliged to pay on account of liabilities incurred for Oliver prior to such assignment.

2. As to the second objection above mentioned, it must suffice to say, that this is an action not merely to recover a sum of money alleged to be due to the plaintiffs, but it is brought for an accounting and settlement between principals and their agent. It seeks not only the payment to them of such moneys as have been collected, but also the surrender of the securities in his hands.

On the taking of the account it was in all respects proper to ascertain not only what the balance was when the action was commenced, but also to ascertain what securities the defendant held, which he should be adjudged to deliver to the plaintiffs.

The defendant in such a suit could not defeat the plaintiffs of their title to relief, nor deprive them of any part of such relief, nor drive them to a new action, by converting the securities or any part of them into money, by collecting them or otherwise, while the action is pending. If on the accounting it appeared that he had done so, he was bound to account for the money and pay it over in lieu of the securities which he would have been bound to surrender if he had not collected them.

The parties did not, it is true, in the form of proceeding in this action, follow the former practice in Chancery by bringing the cause to a hearing on the question, whether the defendant was liable to account, and on a decree for an accounting go to a Master or Referee to have the account taken. They mutually consented to refer the whole of the issues to a Referee, in the first instance, and it was proper that he should, if he found the defendant liable to account, proceed with the accounting as he did without objection.

3. It is insisted that the Referee should have received proof of the transactions between Oliver and the defendant, subsequent

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to the assignment to the plaintiffs, October 7, 1854, ana charged to the plaintiffs what was due to the defendant from Oliver.

The views above expressed in relation to the effect of the assignment to the plaintiffs, dispose of this objection. The judgment record offered in evidence by the defendant, showed on its face that it was recovered for an indebtedness arising out of transactions, subsequent to the assignment, and between April, 1855, and December, 1857, and in a suit not commenced until one year after this action was brought.

4. We have examined the exceptions taken to the rulings of the Referee on the trial, admitting or rejecting evidence. We think none of them well taken. Some of them are in effect disposed of by what has already been said. Of the others we think extended notice is not here necessary.

Two or three of them perhaps require that we should say, that the offer of the defendant to show that in the account rendered September, 9, 1856, credit is given for certain notes as cash, which notes have not been paid, was an offer to contradict the admission in the defendant’s answer, and was properly rejected on that ground if on no other. That answer expressly admitted it to be an account of moneys collected, and assigned only specific reasons for alleging that the balance thereby appearing was not due, and no such ground was intimated as the defendant now offered to prove. Uor was it suggested that there was any error or mistake therein, but only that there were other transactions not embraced therein.

The short answer to the claim of the defendant that the question put to the witness Foster, should have been allowed is this: The question assumed that the witness had testified, that he had made a demand on Foster for the policies of insurance and documents. He had not so testified, but on another ground it was not admissible, it was an endeavor to make the defendant’s own declarations evidence in his own favor. This he could not do unless the plaintiff had given evidence of a part of the conversation, and so raised some presumption which the reply would explain or rebut, or render the whole conversation admissible by proving a part. Here the plaintiff had proved no such demand as the question assumed.

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The other exception, is to the ruling of the Referee, permitting the plaintiffs to produce and surrender the defendant a bill of exchange for £4,132 5s. 5d, which was we think plainly correct. If that bill was, as the defendant alleged in his answer, an accommodation bill without consideration, then it being produced in the plaintiffs’ hands unpaid, and the surrender thereof left the account between the parties in the same state as if it had never been drawn. If it was a bill valid in the plaintiffs’ hands, upon sufficient consideration, then both that and the balance of account were due. No proof as to the consideration was given by the defendant. Thejpnmct facie import of the bill was, that that sum was due to Edward Oliver from the defendant, or was received by the defendant from Oliver, when the bill was drawn. In respect to this, no error was committed by the Referee of which the defendant can complain.

The judgment should be affirmed.

Judgment affirmed.