A deed of arrangement to that effect was accordingly, in December, 1831, executed by Flude and Simpson, to the defendants, who acted as trustees, and at the end of this deed there was a clause by which the policy in question on the life of Flude, was assigned to the defendants as a security for the payment of the instalments, with a provision that, after payment, the surplus, if any, should go to the representatives of Flude. This, and other policies, together with his furniture, comprised the whole of Flude's separate estate.

The partners continued to carry on their business, and paid the first and second instalments pursuant to the deed, and Simpson, who was called as a *445] witness, *said that they expected to retrieve themselves: but before the third instalment was paid, all their effects were exhausted, and a commission of bankrupt was issued against Flude about December 1833.

For the plaintiffs it was contended that the deed of December, 1831, was of itself an act of bankruptcy by Flude as against his separate creditors, being executed with intent to delay them, and by way of fraudulent preference of the joint creditors.

The Chief Justice left it to the jury to say whether the deed was executed bona fide to enable the partners to continue to carry on their business, or whether it was executed by Flude with intent to defraud his separate creditors. A verdict having been found for the defendants,

Kelly, moved for a new trial on the ground that the attention of the jury should have been called to the fact that Flude was insolvent at the time of executing the deed, and that his becoming a bankrupt, though not certain, was in a high degree probable.

He referred to Morgan v. Horseman, 3 Taunt. 241, and Linton v. Bartlett, 3 Wils. 47.

TINDAL, C. J. The grounds of objection to my summing up are two:First, that the attention of the jury was not sufficiently called to the circumstance, that at the time of the execution of the deed of 1831, Flude and Simpson were insolvent; secondly, that the jury were not told that the bankruptcy of those parties, though not certain at that time, was in a high degree probable. The act of bankruptcy relied on by the plaintiffs is the execution of the deed of 1831, which is alleged to constitute an act of bankruptcy on a double ground; *446] first, that it was a conveyance executed with the intent to *defeat or delay creditors; secondly, that it constituted a fraudulent preference. The first ground is taken from the statute itself, 6 G. 4, c. 16, s. 3, the words of which are, that if any trader shall make or cause to be made any fraudulent grant or conveyance of any of his lands, tenements, goods, or chattels, with intent to defeat or delay his creditors, such trader will be deemed thereby to have committed an act of bankruptcy.

In order to make the conveyance an act of bankruptcy within that clause, two circumstances must concur; the grant must be fraudulent, and it must be executed with intent to defeat or delay creditors.

Now, this deed is very unlike any grant to which the attention of the Court has hitherto been called on this subject. So far from being a conveyance with intent to defeat or delay creditors, it is an agreement that two traders shall remain in possession of their property, for the purpose of continuing their business, upon condition of paying 4s. 6d. in the pound upon the amount of their debts, by certain instalments. At the end of the deed there is a clause by which certain policies on the life of one of the partners, then in the hands of his bankers, are assigned to the trustees as a security for the payment of the instalments, with a provision, that after payment, the surplus produce of them, if any, shall go to his representatives.

Let us see the effect of this deed. It passes no property from the traders of which their creditors could at that time avail themselves, and as to the alleged preference of any particular class of creditors, the joint creditors of Flude and Simpson could resort to no remedy under the deed till the period of the third

instalment had expired, whereas the separate creditors of Flude might in the intermediate time issue execution against his person or property; and as the policies could not come into effect till Flude's decease, the transfer of *them

to the trustees was not a grant by which his creditors could be defeated [*447 or delayed. The effect of the deed, therefore, was, by delaying the remedy of the joint creditors, rather to improve the situation of the separate creditors of Flude. But Simpson, who was called as a witness, stated, that so far from having any intent to defeat or delay their creditors, they thought at the time, that by means of that arrangement, they should be able to go on and effectually to retrieve their affairs. It was, therefore, a question for the jury also, resting on Simpson's credit, whether this deed was executed with intent to defeat or delay creditors; and the verdict of the jury was warranted by all the evidence before them.

What has already been said, applies also to the second ground on which this deed has been assumed to constitute an act of bankruptcy, that it was a fraudulent preference made in contemplation of bankruptcy: the bankruptcy did not take place till two years after; and it was for the jury to say what was the intention of the parties in executing a deed so long before. The fact that they were in insolvent circumstances is a circumstance that occurs in almost all these cases; the question with reference to the validity of their conveyance is, whether they had bankruptcy in contemplation at the time.

PARK, J. The whole was a question for the jury, and their finding is consistent with the evidence; the testimony of Simpson is positive that there was no intent to defeat or delay the creditors, and the object of the deed was expressly to enable the traders to go on.

As to the objection that the insolvency of the parties was not prominently pointed out to the attention of the jury, the question for the jury on these occasions is, whether bankruptcy was in contemplation at the time of the execution of the deed; as the Chief Justice has observed, there is hardly a case in which the party does not know he is in insolvent circumstances.

*ĜASELEE, J. I think there is no occasion to disturb the verdict of the jury, who have found to the satisfaction of the judge on a question properly left to them.

[*448

BOSANQUET, J. I am of the same opinion. The argument for the plaintiffs is, that because a debtor in insolvent circumstances makes a transfer to one of his creditors, he means to defraud the others, and that because bankruptcy takes place two years after the transfer, it must have been contemplated at the time. The whole effect of the evidence in this cause, is to shew that bankruptcy was not in contemplation when the deed was executed, but the reverse; the object of the parties was to struggle on in the hope of retrieving their affairs.

See Atkinson v. Brindall, 2 New Cases, 225.

Rule refused.

CANOT, Assignee of HUGHES, an Insolvent, v. HUGHES, Widow, Ad

ministratrix. Jan. 14.

The widow and administratrix of an insolvent, being applied to by his assignees for some papers that had been in his possession at the time of his decease, answered that they were in the hands of her attorney:

Held, not sufficient evidence of a conversion to sustain an action of trover.

TROVER. The plaintiff, as assignee of Hughes, an insolvent, sued his administratrix for the conversion of certain wine warrants in the possession of the insolvent at the time of his death. The only evidence of conversion, was an ap plication for the warrants, made on the part of the plaintiffs, to the administr

trix, when she said they were in the hands of her attorney. Upon which the plaintiff was nonsuited, on the ground that this did not amount to a conversion, or a refusal to deliver.

*449] *Bompas, Serjt., moved to set aside the nonsuit, on the ground that as the defendant must have known of her husband's insolvency, and that, therefore, the warrants belonged to his assignees, the delivering them to the attorney instead of the assignees was an actual conversion.

Sed PER CURIAM. There is no evidence that it was communicated to the defendant who was the owner of the warrants; the placing them in the hands of her attorney was no more than placing them in a strong box for the purpose of safety. Rule refused.

CUMPSTON and Others, Assignees of DANIEL and JOSEPH HAIGH, Bankrupts, v. W. and J. HAIGH. Jan. 18.

Defendants, proprietors of a scribbling and fulling mill, stipulated that all goods on hand should be subject to a lien for a general balance. Having received certain wool and cloth of the plaintiff to be scribbled and fulled, and certain oil and dyeing materials to be used by the plaintiff on the wool, for which purpose the plaintiff had access to the oil and dyes in a room of which the defendants kept the key, Held, that the defendants had no lien for their general balance on the oil and dyeing materials.

TROVER for oil, madder, camwood, logwood, fustic, and one dye-pan. Plea: That long before the bankruptcy of Daniel and Joseph Haigh, and the supposed conversion in the declaration mentioned, the defendants were lawfully possessed of a certain scribbling and fulling-mill and premises at Slaithwaite, wherein the defendants carried on their business of scribbling and fulling wool for certain reward to them the defendants in that behalf, and on certain terms, viz. that "all goods on hand were *subject to a lien for a general *450] balance" that, whilst they carried on their business on the said terms, D. Haigh and J. Haigh, during a long space of time before they became bankrupts, brought divers large quantities of wool to the said mill and premises of the defendants, to be by them scribbled and fulled in their said business for the said reward to them in that behalf, and on the said terms; during all which time the said D. Haigh and J. Haigh had notice of the terms aforesaid on which the defendants carried on their business; and in respect of which said work of scribbling and fulling wool as aforesaid, they the said D. Haigh and J. Haigh before and at the time they became bankrupts, and until the time of the said supposed conversion, were and still are largely indebted to the defendants for the said scribbling and fulling wool for them the said D. Haigh and J. Haigh, in a certain large general balance, to wit, in the sum of 3667. 14s. 5d; and the said goods and chattels in the declaration mentioned were delivered at the defendant's mill and premises in the course of their said business, and before the said D. Haigh and J. Haigh became bankrupts; and before and at the time of the said supposed conversion were and still are goods of the said D. Haigh and J. Haigh, in the said mill and premises of the defendants, on hand, and subject to the said lien of the defendants for the said balance; of which premises the said D. Haigh and J. Haigh before they became bankrupts, and the plaintiffs, assignees as aforesaid, since, respectively had notice: that, by reason of the premises, the defendants at the said time in the declaration mentioned, detained the said goods and chattels, and held them for their lien aforesaid, as they lawfully might for the cause aforesaid: which detaining and holding of the said goods and chattels was the said supposed conversion thereof in the declaration mentioned.

*451]

*Replication. That the said goods and chattels in the declaration mentioned were not, nor was any part thereof delivered before the said

D. Haigh and J. Haigh became bankrupts, at the defendants' said mill and premises in the course of the defendants' said business in their plea mentioned; and were not, nor was any part thereof before or at the time of the conversion thereof in the declaration mentioned, goods of the said D. Haigh and J. Haigh in the said mill and premises of the defendants on hand, and subject to the said supposed lien of the defendants for the said general balance in the plea mentioned, in manner and form as the defendants had above in their said plea in that behalf alleged.

At the last York assizes a verdict was entered for the plaintiffs for 1201. subject to a motion for setting the same aside, and delivering the postea to the defendants, or for reducing the damages, upon the following state of facts.

The defendants had a mill at Slaithwaite, in Yorkshire, frequented by the various manufacturers in the neighbourhood, who took their wool and oil to the mill for the purpose of being scoured and made into slubbing, by which is understood, wool in a condition to be woven into cloth. The wool, before it is made into slubbing, is also dyed, and for that purpose the defendants had conveniences at the mill, namely, a dye-house with dye-vats, pans, &c., in which the various customers of the mill dyed their own wool.

In the mill was affixed, in large characters, "All goods on hand subject to a lien for general balance."

Amongst others who so employed the mill, were the bankrupts, both of whom were fully cognizant of that notice. At the time of their bankruptcy they had on the defendant's premises (the mill) various articles of merchandize, viz. cloth in a manufactured state, wool, a quantity of oil, and also a quan[*452 tity of dye-wares. The oil and the dye-wares were in a room of the mill, called the fulling-room; to that room all the customers of the mill had access. The bankrupts had a key to the oil casks, from which their servants drew oil as they had occasion; but both the oil and the dye-wares were under the lock and key of the defendants every night.

Alexander, having obtained a rule nisi to set aside the verdict or reduce the damages,

Tomlinson, shewed cause. The defendants had no lien on these goods for their general balance. A particular lien is defined to be a right to detain goods on which labour has been bestowed, till the labour on the goods is paid for; and a general lien only extends the right in respect of the claim to be satisfied, not in respect of the sort of goods to be detained; there must still be goods on which the creditor's labour has been bestowed. In Houghton v. Matthews, 3 B. & P. 494, Heath, J., says, "There are two species of liens known to the law, namely, particular liens and general liens. Particular liens are, where persons claim a right to retain goods in respect of labour or money expended upon them; and these liens are favoured in law. General liens are claimed in respect of a general balance of account; and these are founded in custom only, and are therefore to be taken strictly;" and the same principle is established by Rushworth v. Hatfield, 6 East, 522. The defendants, according to their plea, claim a lien in respect of labour bestowed by the scribbling and fulling mill; they had a right, therefore, to detain the bankrupt's cloth and wool on which the labour of scribbling or fulling had been bestowed; but they had po right, either according to their plea, or the general principles of lien, [*453 to detain oil-which is an accessory only, used in the process of scribbling, and not the thing scribbled, or dyeing materials, which they neither be stowed any labour on, nor even employed in dyeing; that proceess having been conducted by the bankrupts themselves, who had the key of the oil, and constant access to the dyeing materials, so that they were rather in the possession of the bankrupts than of the defendants.

It may be contended, however, that the defendants stipulated for a lien on these goods by their notice that all goods on hand were to be subject to a lien for a general balance. But that notice must be construed according to the

principles which regulate the right to lien; and goods on hand can only mean goods on hand to be manufactured, not accessory goods employed in the process of manufacture.

Alexander, and Hoggins, in support of the rule. The defendants rely on the stipulation contained in the notice; and by goods on hand, the defendants meant to include all goods that were sent to, and remained in the mill, whether for the purpose of being manufactured or of being used in the process of manufacture. In Jacobs v. Latour, 5 Bingh. 132, Best, C. J., says, "As between debtor and creditor, the doctrine of lien is so equitable, that it cannot be favoured too much." And no sound distinction can be made, under the circumstances of the present case, between the principal article to be manufactured, and accessory articles employed in the process. The accessory articles might clearly have been detained after they had been absorbed into the principal article; and whether they were actually in the cloth or wool, or placed in an adjoining room in *454] order to their *immediate absorption, can make no difference in the rights of bailor or bailee.

The argument, that the goods in question were in the possession of the bankrupts, is answered by the fact, that the defendants retained the key of the fulling room, which was the place of deposit. At all events, therefore, the verdict ought to be reduced by the amount of the value of the dyeing wares.

TINDAL, C. J. I think this rule must be discharged. This is an action of trover for a cask of oil and certain dyeing wares, and the question is, whether the defendants are entitled to enforce a lien for their general balance. The right to lien depends upon general usage or particular stipulation: in the present case it is not claimed on the ground of usage, and we have, therefore, to see whether it is supported by any express stipulation: that turns entirely on the notice posted up in the mill: "All goods on hand are to be subject to lien for a general balance." The defendants contend that this includes not only goods deposited there for the purpose of being manufactured, but adscititious. articles used in the course of the process. In order to justify that construction of the notice, we must give the words on hand two distinct meanings: for cloth and other articles in the progress of manufacture are certainly goods on hand : but in order to satisfy the argument used for the defendants, we must give a secondary meaning to those words, and apply them also to articles used incidentally in the process of the manufacture.

If such had been the intention of the defendants, they, who themselves made the stipulation, should have made it more distinct, and the rather, as they propose to go beyond what the rule of law allows. They should have said, "All goods on hand, whether goods to be manufactured, or goods to be used in the process." *Taking it, therefore, on the contract framed by the defend*455] ants themselves, the goods, which are the subject of this action, are not included in the contract. But, upon the evidence in the cause, it is abundantly clear that the notice could only apply to such goods as were frequently on hand; that is, goods on which the labour of the defendant's mill was employed.

PARK, J. I agree that this is a lien depending on particular stipulation only, and if we look at the evidence to see whether these goods were goods on hand within the meaning of the stipulation, we find that a part of them was under the control of the bankrupt's servants, who delivered out portions from time to time. But the goods themselves were not goods on hand within the meaning of the contract, which clearly applies to goods to be manufactured, and not to articles used incidentally in the process.

GASELEE, J., concurred.

BOSANQUET, J. The only question is, what is the true construction of this notice. I think it is impossible to apply the words goods on hand to articles used only in the process of manufacturing goods on hand. Rule discharged.