Woods v. Timmerman's Assignee

1. Assignments for the benefit of a portion of the creditors of the assignor are valid notwithstanding section 39 of the act concerning voluntary assignments ; that section operates to overthrow all provisions in assignments giving preferences among the designated creditors. 2. A provision in an assignment providing for the payment of a particular debt of a designated creditor would he valid.

Appeal from Si. Louis Circuit Court. Francis Timmerman made an assignment of his effects to William Muir for the benefit of his creditors. In the schedule annexed to this deed the claim of the plaintiffs is thus described: “ Names — Messrs. Woods, Christy & Co.; Residence — Main street, St. Louis ; Class — Two notes ; Amount —^554.55.” Timmei’man was further indebted on a note for $3,180.50, payable to the order of one of the plaintiffs individually, but which was claimed to belong to the firm of Woods, Christy & Co. This note was mentioned in the deed of assignment. It was secured by a deed of trust executed by Timmerman on certain leasehold proporty in St. Louis. •Plaintiffs sold the leasehold under the deed of trust and were paid out of the proceeds, on account of said note, $1,476.57. They afterwards presented the note, with the balance due on it, to the assignee for allowance and payment under the assignment. It is admitted that the proceeds of the assets assigned will pay the creditors mentioned in the schedule a dividend of less than fifty per cent., even should the plaintiffs claim on this note not be allowed. The assignee certified the claim to the circuit court. A jury, on an issue submitted to them, found that the note, though made payable to an individual member of the firm, was the property of plaintiffs. The plaintiffs moved the court to grant an order requiring the assignee to allow the claim of the plaintiffs on said note for $3,130.50, and to a pro rata dividend on the balance due thereon. The court granted the motion and required the assignee to allow the claim and pay it pro rata with the other claims. I. The assignment of Timmerman was for the purpose of paying certain specified creditors certain specified debts. No provision is made for paying any other debts of the grantor than those named. The note of $3,130.50 was not included in said assignment and can take no benefit from the property assigned. I. It was the duty of the assignee “ to adjust and allow the demand” of the plaintiffs. (R. C. 1845, p. 130, § 16.) The assignee not doing so that duty devolved on the circuit court. The deed of assignment could not fix the amount of plaintiffs’ demand. The assignor had no power so to conclude the matter, nor could the assignee and plaintiffs conjointly. What was owing in point of fact was a question to be investigated and decided by legal evidence, and this was to-be done, in contemplation of the law, in defence of the deed and the agreement of the assignor, assignee, and the beneficiary specially concerned. The assignor could not put the plaintiffs’ demand higher or lower than it was in fact. He could neither enlarge nor diminish the plaintiffs’ demand. It was the duty of the court to ascertain the debt due independently of the way in which it had been fixed by the assignor. The purpose of the assignor was manifestly to divide his property pro rata among all his creditors.