Gridley v. Myers

Laws 1881, e. 148 — Assignment Becomes Operative when Filed. An assignment for the benefit of creditors, under the insolvent law of 1881, does not take effect or become operative for any purpose until filed in the office of the clerk of the district court.

Action in the district court for Hennepin county by plaintiff, trading as the Olive Wheel Company, against Peter A. Myers, Elizabeth A. Patterson and Harlow A. Jacobs, copartners as P. A. Myers & Co., Harlow A. Jacobs, and George It. Smith, the assignee of Harlow A. Jacobs, to recover $3,274.15 for the alleged wrongful conversion by defendants of a number of bicycles .and bicycle attachments. Judgment by default was obtained against all of the defendants, except Smith, the assignee, who interposed an answer. The cause was tried before Lancaster, J., without a jury, and judgment was ordered against defendant Smith for $673.50. From an order denying his motion for a new trial, defendant Smith appealed. The bicycles and bicycle attachments in question were furnished to defendant firm by plaintiff under a conditional sales contract, under the terms of which the title to the bicycles remained in the vendor, the plaintiff, until paid for in full. During the year 1897 and prior to June 1, plaintiff delivered to defendant firm under this contract bicycles and bicycle attachments, which, at the price agreed on in the contract, amounted to $3,274.15. None of the goods were ever returned to plaintiff, and nothing was ever paid for them. Defendant Jacobs became a member of defendant firm shortly after the execution of the contract, and about the first of June he purchased the interests of his partners, took possession of the assets, and continued the business under the former firm name until June 14. On that day Jacobs made an assignment, under the insolvency law, to defendant George R. Smith. The deed of assignment was executed and delivered at noon, and was filed in the office of the clerk of the district court for Hennepin county at 5:12 o’clock p. m. The conditional sales contract was filed in the office of the city clerk of Minneapolis at 4 o’clock p. m. the same day. Plaintiff duly demanded the return of the goods prior to the filing of the assignment, and again prior to the commencement of the action. As to the statute providing that every deed of assignment shall be void unless filed, our contention is that, like all of our other recording and filing acts, it is designed for the protection of subsequent purchasers, mortgagees, assignees or attaching creditors of the insolvent, and that a deed of assignment is void as to them, but as to the rest of the world is valid. Mann v. Reed, 49 111. App. 406; Farwell v. Cohen, 138 111. 216. If this contention is correct, it necessarily follows that the equitable attachment on behalf of the creditors was complete, and their rights fixed and established, on the execution and delivery of the deed, before respondent filed his contract. Bank of Farmington v. Ellis, 30 Minn. 270. The question is whether plaintiff, having filed his sales contract an hour or more prior to the filing of the deed of assignment, can hold his own property; and we submit that under the statutes the order for judgment of the trial court should be affirmed. G. S. 1894, § 4227; Laws 1895, c. 66; Clark v. Richards Lumber Co., 68 Minn. 282, 72 Minn. 397.