CHAPTER 6.-ASSIGNMENTS.

SECTION 1. Validity.]-That no voluntary assignment for the benefit of creditors hereafter made shall be valid unless the same shall be made in conformity to the terms of this act. [1883, chap. VII.]

SEC. 2. [All property included.]-Every such assignment shall be of all the property, real and personal, of the assignor or assignors therein named, wherever situated, except so much thereof as may be exempt from levy and sale on execution under the general laws of the state.

SEC. 3. [Description of Realty.]-Real estate so assigned shall be described in the deed of assignment in such manner as would be requisite in an ordinary deed of conveyance thereof, and real estate claimed to be exempt shall be expressly excepted by like description.

SEC. 4. [Exempt Property.]-Personal property claimed to be exempt shall be separately specified and described as such in the inventory of the assignor or assignors hereinafter required to be made.

SEC. 5. [Assignee.]-In every such assignment the sheriff and his successor in office of the county in which the assignor resides, or if there be two assignors, in which one of them resides, or if there be more than two assignors in which two or more of them reside, shall be named as assignee.

SEC. 6. [Execution-Acknowledgment-Record.]-Such assignment shall be in writing, and shall be executed and acknowledged in the manner in which a conveyance of real estate is or shall be required to be executed and acknowledged, in order to entitle the same to be recorded. And within twenty-four hours after its execution it shall be filed for record in the clerk's office of the county in which the assignee resides. If it shall convey real estate it shall be recorded in the deed record and entered upon the numerical index in said office, otherwise it shall be recorded in the miscellaneous record. Within thirty days after its execution it shall be filed for record in every other county in this state in which there shall be situate real property conveyed therein, and such assignment shall be recorded in each such county in the manner aforesaid. A failure to file such assignment for record within the time aforesaid in any county in which by the terms of this section it is required to be recorded, shall avoid such assignment as to property situate in such county; and if a failure so to file shall be due to the negligence or misconduct of any assignee appointed under the provisions of this act, such assignee shall be liable to the creditors for the value of all property as to which such assignment shall be so avoided, and may be required to account for the same in

NOTE. "An act regulating voluntary assignments for the benefit of creditors, proceedings thereunder, and to prevent the fraudulent violation of the same.' This act repealed chapter 6 as published in the first edition of this compilation, and now takes the place of that chapter. No decisions have been made directly upon this act, but under the former law it was held.

I. GENERALLY: Assignee represents assignor, not creditors: 13 Neb. 300. (Overruling dicta in 12 Neb. 167, that "assignee is a trustee for creditors.") Assignee cannot interpose fraud of assignor in order to defeat a prior sale: 13 Neb. 302. Mortgagee not competent witness in action between heirs and assignee of deceased: Id. 300. Assignor cannot maintain injunction against attachment creditor; nor can assignee come in of his own motion as defendant: 14 Neb. 427. Proceedings under control of court: 9 Neb. 46. Under law of foreign state, no bar to action here: 10 Neb. 220. [But see 12 Neb. 121.] If valid; property not subject to attachment: 7 Neb. 283. Possession by assignor evidence of fraud: Id. 433. Surplus of goods may be returned to assignor: Id. Assignee may re-purchase goods sold for his own use and benefit: 12 Neb. 24. Debtor may prefer bona fide demand of creditor: Id. 25. Law does not prevent a debtor, though in failing circumstances, from preferring a creditor by a separate and independent conveyance unconnected with the transaction of making the assignment, even though the preferred creditor be the assignee named in the assignment subsequently made: 15 Neb. 535. Subsequent fraudulent act of assignor will not vitiate: possession of assigned estate, how forfeited: Id. 481. One of two partners, with consent of the other, may make; partner absconding, consent implied: Id. Power of debtor to inake: 7 Neb. 25. Authorizing sale on credit, void: Id. Fraudulent; creditor may set aside; petition should allege that assignment was made "with the intent" to hinder, delay, etc, 7 Neb. 432.

II. SPECIALLY: Deed not admissible in evidence when creditor asks for personal judgment: 10 Neb. 220, Deeds must be executed and acknowledged: Id. 514. Should be recorded in miscellaneous record: Id.; 12 Id. 169. Provision that assignee may "compromise choses in action" applicable only to doubtful claims: 9 Neb. 45. Failure to describe property specifically; objection that exempt property is excepted; and reservation for benefit of assignor does not render assignment void on its face: Id. Contract to buy up claims, and accept assigned estate in satisfaction, action against assignors to recover balance due upon claims at their face value not maintainable: 13 Neb. 242. Clerk of court may act as assignee: 9 Neb. 10. Remedy against assignee, failing to execute trust: Id. 357. Intention of assignors to defraud: 12 Neb. 169.

all respects as in case of other assigned property, or by any other appropriate remedy.

SEC. 7. [Duties of Sheriff.]-Immediately upon the execution and delivery on any such assignment, the sheriff shall take possession of all the assigned estate, and preserve, insure, and safely keep the same for administration according to law, and the sheriff and his sureties shall be liable, upon his official bond, for the faithful execution of the trust created by such assignment, for the preservation of such assigned estate, and for the accounting for and paying over of all moneys derived therefrom. He shall, under order of the county judge, inspect the assigned estate, and take all necessary steps to sell or properly dispose of any and all perishable goods or property of said estate.

SEC. 8. [Inventory.]-Within ten days after such assignment is made the assignor or assignors executing the same shall make and file in the county judge's office of the county in which the assignee named therein resides, to be recorded in a book to be provided for that purpose, an inventory verified by the affidavit of the person or persons making the same, that the same is in all respects full, true and accurate according to the best of their knowledge and belief, and showing: First. All the creditors of the assignor or assignors. Second. The place of residence of each creditor, if known to the assignor or assignors, and if not known, that fact must be stated. Third. The sum owing to each creditor and the nature of each debt or liability, whether arising on written security, account, or otherwise. Fourth. The true consideration of the liability in each case, and when and the place where it arose, and whether there has been any renewal or new promise in relation thereto. Fifth. Every existing mortgage, judgment, or other security for the payment of any debt or liability of the assignor or assignors. Sixth. All property of the assignor or assignors at the date of the assignment which is exempt by law from execution. Seventh. All of the assignor's property at the date of the assignment, both real and personal, of every kind, and wherever situated, not so exempt, and the encumbrances existing thereon, and all vouchers and securities relating thereto, and the value of such property in detail according to the best of the assignor's knowledge.

SEC. 9. [Meeting of creditors.]-It shall be the duty of the county judge, immediately upon the receipt of such inventory, to fix a day, not more than fifteen days thereafter, for a meeting of the creditors of such assignor or assignors at his office for the purpose of choosing an assignee to succeed the sheriff in such trust, and he shall immediately make advertisement of the time and place of such meeting by publication in some newspaper published or of general circulation in such county, and also shall, within two days after the first publication thereof, send a copy of such notice to each creditor mentioned in said inventory, addressed to his place of residence therein named, with postage prepaid. No informality or neglect with reference to such notice shall invalidate any action taken pursuant thereto or to such order. The certificate of the county judge that he has given such notice shall be sufficient evidence thereof.

SEC. 10. [Same-Proceedings.]-At the time and place fixed in such order, the creditors, or so many of them as shall be present in person or by proxy, may proceed by ballot to choose an assignee to succeed the sheriff, and the sheriff shall be eligible. At such election each creditor shall be entitled to cast one vote, but no person shall be regarded as chosen unless he shall receive the vetes of creditors representing a majority of the gross indebtedness, and shall also have been voted for by one-third of all the creditors; nor shall any creditor be permitted to vote upon any claim against the assignor or assignors unless the same shall be verified by the affidavit of the creditor to be just and reasonable and wholly unpaid to the extent claimed, setting forth the true consideration thereof and that the same is not, to the best of said affiant's knowledge and belief, subject to any legal or equitable recoupment, counterclaim or set off, which, if allowed, would reduce the debt below the amount claimed.

SEC. 11. [Adjourned meeting.]-Such meeting of the creditors may be adjourned from day to day not exceeding three days, and should there be a failure to choose an assignee as provided in the preceding section, the sheriff and his successor or successors in office respectively shall remain the assignee of the estate. SEC. 12. [Inventory-Appraisement.]-Immediately upon the adjourn ment of such meeting the sheriff and the assignee, if any chosen thereat, shall proceed to make and return to the county court an inventory and appraisement of the entire estate assigned, in the manner provided by law for the appraisal of property taken on attachment issued out of the district court.

SEC. 13. [Bond of assignee.]-Within forty-eight hours after such inventory shall be returned and filed, the assignee shall enter into an undertaking in double the amount of the appraised value of the whole estate, with two or more sureties to the satisfaction and approval of the county judge, conditioned for the faithful discharge of his duties as such assignee. If the assignee fail to give the undertaking within the time aforesaid his election shall become null, and the estate shall be administered as though no election had been had.

SEC. 14. [Same-Record.]-The bond of the assignee shall be recorded in the office of the county clerk, and the record thereof shall have the same force as the record of other official bonds.

SEC. 15. [Property delivered to assignee.]-Immediately on the execution and approval of such bond the sheriff shall deliver all the personal property belonging to such estate to such assignee and shall execute and deliver to such assignee, as such, a deed of quit claim of all real estate conveyed by such assignment.

SEC. 16. [Claims.-Upon the day of the meeting of the creditors the county judge shall fix a day, not more than sixty nor less than thirty days thereafter, within which all claims against the assigned estate shall be filed, and within which the assignee or assignor or any creditor may file any objection, defense, set off, or counter claim to any claim which the assignor might or could have opposed to the same had action been brought upon the same before assignment. Notice of the time so fixed shall be given in the manner hereinbefore provided for notice of the first meeting of the creditors. Any claim, objection, set off, or counter claim not filed on or before the date so named shall be forever barred from being considered in the settlement of said estate or participating in any dividend therein.

SEC. 17. [Same-Trial.]—On the day following the day fixed under the provisions of the preceding section all uncontested claims shall by the county judge be allowed and entered of record, with the amounts thereof, in a book to be provided and kept for that purpose. Upon all contested claims the county judge shall order pleadings, as nearly as practicable like those in ordinary civil actions in said court, to be summarily made up, and thereupon said cause shall proceed in said court as in ordinary civil actions therein, but no such cause shall be continued for a longer time in the aggregate than sixty days from the day so fixed. SEC. 18. [Same-Judgment.]-Judgment in said action shall be that such claim or some amount thereof be allowed, or that the same be disallowed, or that the assignee have and recover from the person making the claim a certain amount. If the claim shall be allowed judgment for cost shall be adjudged against the party or parties contesting the same. If the claim be allowed in part only, the court adjudicating the same shall apportion the costs or adjudge them as may be just. If the claim be wholly disallowed, or the assignee recover judgment, costs shall be adjudged against the claimant, but in no case shall the costs be paid out of the assigned estate except as in this act otherwise provided. In such cause the claimant shall be named as plaintiff and the contestant or contestants as defendant. Judgment in favor of the assignee or for costs shall be collected as in other cases. Whenever any contested claim shall be finally allowed, or so much thereof as shall be finally allowed, shall be entered of record in like manner as other claims.

SEC. 19. [Appeal.]-No petition in error shall be allowed from the judgment of the county court upon a contested claim, but either party may appeal therefrom as in other cases. Upon such appeal the cause shall be docketed in the district court within twenty days after the filing of the appeal bond, and shall stand for trial at the next term of the district court thereafter, or at the same term if the court shall be in session at the time it is docketed, and upon the same pleadings upon which the same shall have been tried in the county court; Provided however, That the court may for sufficient reason grant a continuance to either party as in other cases, and may order any pleading to be amended, or allow any pleading or pleadings to be withdrawn and a motion or demurrer to be filed in lieu thereof. In all other respects the cause shall proceed as nearly as may be as in other cases.

SEC. 20. [Sale.]-Immediately upon the return of the inventory and appraisement and the approval of the bond of the assignee, if one shall have been chosen by the creditors, the assignee shall proceed to advertise for sale and sell the assigned estate in all respects as though the same had been taken on execution, issued out of the district court. Real estate so sold shall be conveyed by the assignee to the purchaser or purchasers of the same by a deed or deeds of conveyance, executed and acknowledged as in other cases, which shall convey all the interest the assignor had in the property sold at the date of the assignment. Before such conveyance shall be made the proceedings on such sale shall be returned to and confirmed by the district court or judge as in case of sales of real estate on execution, and the court or judge may set said sale aside or make any order in the premises as in case of such sales on execution. No notice of an application to have such sale confirmed need be given to any person, but any party interested may appear and resist the confirmation, and the application may be made by any person interested, and the assignee may be compelled by attachment by the court or judge to make the return with all reasonable dispatch. Provided however, That the creditors at their first meeting may, by a like vote as that required for the election of an assignee, require any portion or all the personal property assigned to be sold at private sale. Upon such request the county judge shall make an order that the personal property described in the request shall be sold by the assignee at private sale, and shall direct the mode of such sale, whether the same, being merchandise, shall be sold at retail or in job lots, or both, or otherwise, and whether upon any or upon what notice or advertisement, and such sale shall be solely for cash. Nor shall any such property be sold at private sale for less than its appraised value, except upon written application of a majority in amount of the claims voted upon the election of the assignee, fixing the price, and on order of the county court. The court shall also direct by order who shall be employed, if any one, to assist at such private sale, and the amount of his or their compensation, but such private sale shall not continue longer than sixty days after the making of the order authorizing the same. At the expiration of such time the remainder of such estate, if any, shall be immediately advertised and sold in the manner hereinbefore provided.

SEC. 21. [Report of Sale.]-Immediately upon the sale of any portion of the estate, the assignee shall report to the county court the description or descriptions of the property sold and the amount received for the same and shall retain such proceeds subject to the order of the court. He shall also make a like report between the first and fifth days inclusive of every calendar month after his appointment.

SEC. 22. [Distribution of funds.]-At the expiration of three months from the date of the inventory and appraisement, or sooner if, and as often as, the assignee shall be in the possession of sufficient funds, the county court shall order a distribution of all moneys in the assignee's hands, fixing the amount in dollars and cents to be paid to each person entitled thereto, and thereupon the assignee and his sureties shall become liable to such person therefor absolutely.

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The court may also enforce obedience to such order by the assignee by attachment for contempt, and may commit him to the common jail of the county or any other suitable place of confinement and safe keeping until he shall comply therewith.

SEC. 23. [Same.]-As soon as the entire estate shall have been converted into money the county court shall make a like order for the final distribution thereof, which shall have the same effect and may be enforced in like manner as the order mentioned in the last preceding section.

SEC. 24. [Same.]-Moneys coming into the hands of the assignee shall be distributed in the following manner: First. To the payment of any public tax or assessment charged against the assignor or assignors or his or their property. Second. The payment of the fees and allowances of the assignee, the county judge, sheriff, and officers. Third. The payment of preferred claims in full. Fourth. The balance shall be divided among the creditors, so that the amount paid to each shall bear the same relation to the whole sum to be so divided that the amount of such creditor's claim shall bear to the aggregate amount of all the claims proven.

SEC. 25. [Contested Claims.]-If at the time any order of distribution is made there shall be any contested claim still being litigated, a dividend shall be declared in its favor in all respects as though the same had been finally allowed, but the assignee shall be directed, in the order of distribution, to retain the same in his hands until the litigation shall be finally determined, and he shall retain the same accordingly. When it shall be certified to the county court by the clerk of the court in which any such action is pending, that litigation therein is finally determined, and that the time for appeal or proceedings in error therein has expired, or has been waived, the county court shall make a further order determining the amount of such dividend to which such claimant shall be entitled, if any, and directing the assignee to pay such amount to such claimant and retain the balance of such dividend, if any, to be distributed in the same manner as other funds belonging to the estate.

SEC. 26. [Final order of distribution.]-When all the estate has been converted into money, and all the contested claims have been finally determined and the result thereof certified to the county court as aforesaid, the court shall make a final order of distribution, which shall be immediately obeyed.

SEC. 27. [Discharge of assignee.]-When the final order of distribution shall have been made, and the assignee shall have made return and satisfactory proof that he has obeyed all orders of distribution and paid the money as therein directed, the county judge shall enter an order discharging the assignee and the sureties upon his official bond from all liability on account of said trust; but before such order shall be made, a time shall be fixed for hearing the matter, and notice thereof shall be given in the manner provided with reference to the first meeting of creditors.

SEC. 28. [Fees.]-The following and no other fees and allowances may be allowed and paid out of the assigned estate, viz: To the attorney or person draughting the deed of assignment, ten dollars; to the county clerk for recording the deed of assignment and bond of assignee, the fees allowed by law for other like services; to the sheriff and appraisers for making and returning the inventory and appraisment, such compensation as may be allowed by the county court, not exceeding two dollars per day each for time necessarily employed; to the county judge for preparing and serving each notice required to be given by him, including his certificate or proof of service thereof, ten cents, besides postage actually paid; for filing and preserving each paper or document required to be filed or preserved in the matter, five cents; for allowing each uncontested claim and entering the same of record, ten cents; for recording the inventory and appraisment and any other paper or document required to be entered of record, other than uncontested claims aforesaid, five cents per hundred words, Arabic nu