« ForrigeFortsett »
1806. contract, w hen they pleased, and thus they might hare The Kino 9nosen whether they would or would not employ or. versus 'appoint any person to fill his place, or rather to execute
die Inhabitants . i i . •
rfJI,^,.. the same duties.
Hovil and others, assignees of Wardell (a bankrupt) against Joseph Browning.—January 31st.
Stat. 19 Geo. ° ■ • , ■
II. c. ;>2, s. 1. fjr/,ere mfmfy belonging to a bankrupt was,afler a secret act cfbank
Bankrupt and 1 . ■ . ,
Creditor. ruptcy,attached in the hands of a garnishee, by the custom of foreign
Foreign attach- attachments in London, and paid over by him; held, that such merit in receipt of money was not protected by slat. 19 Geo. II. c. 32, s. 1,
course oftrade. • as a receipt of money under compulsion of law: for that statute extendi only to payments by the bankrupt himself in the ordinary' course of trade, and not to payments by other persons unauthorised by him; and, therefore, the assignees recovered of the person receiving such money, under the foreign attachment, as for money had and received to the use of the bankrupt.
Hot-it and "yHIS was an action of assumpsit for money had and!
'rece'wt' by the defendant for the use of the plaintiff's, Beownino. as assignees of Wardell, a-bankrupt. The defendant pleaded the general issue, and at the trial before Lord EllennoRough, C. J. at the sittings at Guildhall, after last Trinity Term, a verdict was found for the plaintiffs for Sf>7l. Kis. fid. subject to the opinion of the court upon the following case. In November, 1802, Wardell being a tinder, became indebted'' to the defendant in 3()7l. for goods sold and delivered, and on the27th January, 1803,set sail in a ship of which he was the sole owner, with a cargo for the West Indies, having only a few days before committed a Secret act of bankruptcy. In the month of July, 1803, insurances to the an.ount of 3,400k on the ship and cargo, : effected for the bankrupt by M. de Beaume, a po^
Key-broker, residing in the city of London; and, in 1606' the said month of*.July, 180S, the ship and cargo were Hovmnd Captured by the French. On the 20th January, 1804, 0th"' the defendant brought an action in the 'Mayor's court Buownih*. of London against the bankrupt; and attached the sum of S67I. in monies numbered in the hands of De Beaume, who had received die amount of the policies' of insurance from the underwriters, and the defendant: havingon the 28th of the same month obtained a regular judgment by defau.lt in that action, received the sum of 367L from De Beaume. The bankrupt returned to England'in February, 18CH, and on the fjlh of March following, a commission of bankruptcy was issued ngatust him, under which the plaintiffs were chosen assignees, and an assignment to them was regularly executed. De Beaume retained from the plaintiff's as such assignees, out of the monies he had collected on the policies, the amount of the payment he had made to the defendant. WardeII had been a bankrupt twice before; viz. once in the year 178(5, and again in the year 1788, and had obtained his certificate under those commissions; but had not paid a dividend of 15s. in the pound, under the last of them, and his creditors at that time still remain unsatisfied. Question, whether the plaintiff's are entitled to recover?
Sedgwick, for the plaintiff's, stated that the question, in this case turned upon, whether the judgment under ihe foreign attachment authorised the payment to defendant, under theexception contained in the stat. 1° Geo. II. c. .S2, s. 1, to protect payments made in the course of trade; and he cited Brad'ei/ and others assignees cf Bradley v.Clark,* Copland and others w.Sdinf. The circumstance of proceeding at law, against the
jBOS. bankrupt proves that the party knew him to be ill
^ insolvent circumstances. By the process of the foreign
Other* attachment, a debt due to the original defendant, from
versus t|le garnishee, is attached in his hands, and the Bsowmno. , , e , ,'
Statute does not protect the payment or any debt,
by compulsion of law, by another person, hut only
the payment of money in the usual course of trade.
He cited Vernon, v. Hall* Hunter v. lJvtts,f and Sill
Le Blanc, J. "They were both cases of creditors, ttrho were cognizant of the bankruptcy.
The distinction between money paid after the act of bankruptcy, and before the assignment does not prevail in this case; and it is wholly immaterial whether the money was received after the commission, although that was a circumstance relied upon in some of the cases; for the statute applies to the time of the act of bankruptcy, and the properly vests in the assignees from the bankruptcy. It was also objected at the trial, that Wardelt having been a bankrupt twice, and! not having paid 15s. in the pound on the last commission, he could not be a bankrupt a third time, because his future effects are liable to the creditors under the second commission ; hut after the certificate is allowed, the assignees have no further claim upon the property whatsoever. The goods remain the effects of the debtor, subject to the unsatisfied claims of the resi* due of the creditors, under the second commission, and if this claim should not be enforced the property is in him." .
Le Blanc, J. "The ground is that the assignees
under the last commission can have no right because 180fithose of the second commission have." Hum. and
Sedgwick, " When the statute makes the bankrupt »"■»«"
.... . . ... ... .... Buowsinq.
liable tn his creditors, it leaves mm in the common case of a debtor, with respect to his creditors. Besides here is an interval of fifteen years between the two commissions, and the creditors may be barred by the statute of limitations."
Jervis, conira. "The question is, whether the payment is protected as a payment in the usual course of trade under the statute 19 Geo. II. c. Sj2, g. 1. That statute recites the inconvenience of secret acts of bankruptcy, and enacts ' that no person who is really and bona fide, a creditor of any bankrupt for or in respect of goods, really and bona fide sold to such ban&rupt, or for or in respect of any bill or bills of exchange reall v and bona fide drawn, negociated, or accepted by any such bankrupt, in the usual and ordi« narv course of trade and dealing, shall be liable to refund or repay, to the assignees of such bankrupt's estate any money which before the suing forth of such commission was really and bona fide, aud in the usual and ordinary course of trade and dealing, received by such person, of any such bankrupt before such time as the person receiving the same shall know, understand or have notice that he is become a bankrupt, or that he is insolvent in circumstances.' Before this statute, it was the policy of the law to deprive the bankmpt of the power of disposing of his effects,after the act of bankruptcy. It is a remedial statute, and the words are ' bonafide, and in the usual and ordinary course of trade received by such person before such time as he shall know, undeistand, or have notice thai he is become a bankrupt or in insolvent circumstances;* now it is stated, that Wardt.lL committed a sscret act of bankruptcy, and this act of bankruptcy
1806. was, therefore, unknown at the time, when the defend ~ dant instituted the action against Wardell, and attachOth«« ed the money in the hands of De Beaume, under . »erm» which attachment the money was paid. It was the object or the statute to protect payments made bona fide; and there is no better criterion of the goodfaith of the transaction, than the payment by compulsion of » suit at law. Calvert and others assignees of Jones v. Lingard.* There a creditor of the bankrupt brought a sheriff's officer, with a writ into the shop, and then the debt was paid, and it was held good. In the case pf Cox v. Morgan;\ there was indeed a difference of opinion between the judges, but in Holmes v. lVcnHington,% the same principle is adopted, and both of these cases were cited in Bradley v. Clark, and no doubt was hinted as to their propriety. In Cox v. Morgan, Mr. Justice Heath says, that if the objection is made to the payment, because it is made under an arrest, and that is to be made the ground of the decision against the creditor, it will introduce great uncertainty, for if an arrest is to vitiate the payment, why not a menace; and if a menace, why not the promise of some collateral benefit. Now, if the payment under an arrest is good, the payment under a judgment is good; for, otherwise, he who arrests, would lose all benefit by proceeding to execution, which is the fruit and natural consequence of arrest and judgment. By the statute 21 Jac. I. c. 19, s. 9, persons having security for their debis by judgments, or having made attachments in London of the goods of any such bankrupt, whereof there is no execution or extent served andexe
* Cited 5 T. R,p. 200, //. Blac. 335. In Cox. v. Morgan, it is said, this case was heard on a motion for anew tiiid'in the Common Pleas.
'•f 2 Bo*, and Phil. 3j)5.J" 2 Bar. and Pitt. 309. («).■"