Shapleigh v. Baird

Napton, Judge,

delivered the opinion of the court.

The 39th section of the act concerning voluntary assignments (R. C. 1855, p. 210), which was added to this law at the late revision, has given rise to some doubts as to the effect of partial assignments since the passage of the act. This provision has been supposed to invalidate all assignments by a debtor to a portion of his creditors, or at least to make such assignment in effect a general one, so as to let in all the creditors and entitle them to an equal distribution of the property assigned. Previous to the insertion of this section such a construction could hardly have been given to the law. The first section in express terms recognizes the right of a debtor to make a partial assignment embracing only a part of his property or a portion of his creditors. We have not observed in any other section of the act, as it stood before the recent revision, any provision conflicting with this power. It is true, that the general term “ creditors” is frequently used in the act, and the phrase is large enough to extend to all the creditors, whether named in the assignment or not; but it is reasonable to infer from the positive language of the first section, as well .as the general scope and intent of the law, that this general designation of creditors was meant to be restricted to such as were named in the assignment. To give it a more extensive signification woul'd be repugnant to the express provisions in the first section, which beyond all doubt permit a debtor to limit the benefits of a transfer of his property to such of his creditors as he chooses to name in his assignment.

Was it then the intention of the 39th section to abolish this right and make all assignments, after the passage of the act, operate as general assignments, whether all the creditors are named or not ? It will readily occur to any one examining this question, that if such was the intention of the legislature, they have been guilty of a singular oversight in leaving the first section of the act in full force and without even a verbal alteration. To give to the 39th section the construe *326 tion insisted on, which virtually puts an end to all partial assignments, we must hold the first section pro tanto repealed, for the two sections thus construed are entirely repugnant. The language of the 39th section does not of itself require any construction which will at all conflict with the first section or any other section of the act.

To what extent the legislature may have supposed the remedy provided by the 39th section went, and what particular evils this section may have been designed to cure, it is not important for us to inquire. Wo perceive an evil which existed under the old law and which this section seems designed to remove, and which, upon a plain literal interpretation, it does remove. It is not our province, because it fails to reach the core of the disease, to undertake its amendment. Allowing partial assignments still to be valid, as they were previously to its enactment, the section abolishes all provisions in such assignments which give preferences among the creditors selected, and requires the assignee to treat such provisions as nullities and distribute the effects pro rata. In case of a general assignment of all the debtor’s property to all his creditors, which I presume is the usual and common form of such instruments, this section will accomplish every thing that could be desired. It prevents all classification of creditors in such deeds — an evil much complained of, and doubtless within the mind of the legislature. But so long as partial assignments are permitted, and a debtor can transfer his property by such instruments to any portion of his creditors he desires, it is obvious that this section of the revised code of 1855 is totally ineffective to prevent preferences among creditors. The enactment may be always evaded by the selection of a single creditor or any number of creditors sufficient to exhaust the effects assigned. Indeed, if the legislature wish to strike at the root of the evil, they must go back to an old principle of the common law, which permits a debtor to prefer one creditor to another, and which privilege can be effected in a variety of modes other than those referred to in our statutes concerning assignments. Without *327 however undertaking to suggest any views of our own as to the true policy which should prevail, and how far the legislature might with safety go in the abolition of this ancient principle, it is sufficient that the legislature have not as yet, in our opinion, abolished the right of debtors to make assignments to a portion of their creditors. If any such idea was entertained in the enactment of the 39th section referred to, it is so obscurely hinted at, and at the same time so plainly repugnant to previous provisions permitted to stand in the same statute, that the courts can not enforce it. To repeal a previous law, plain language must be used.

The judgment of the circuit court must be reversed upon any construction of this section. It was certainly not designed to annul the deed of assignment, where it was in other respects valid. The circuit court, in effect, held the deed void, and permitted a creditor outside of the deed to levy his execution upon the property assigned.

All the judges concur in reversing the judgment. Judge Richardson declines giving any opinion upon the proper construction of the 39th section.

The cause will be remanded.