McColgan v. Hopkins

Bartol, J., delivered the opinion of this court. This is an action of replevin brought by the appellee against the appellant, to recover certain property formerly belonging to Francis Owens, under whom each party claims, the plaintiff as insolvent trustee, and the defendant under a deed of trust, from Owens. The facts are set out in the agreed statement., (ante 39’6,) and the single question presented for decision is, whether, upon the facts stated, the deed to the appellant is void under our insolvent laws. The deed in its terms conveyed to the-trustee all the property of the grantor, for the benefit of his creditors, of whom McColgan was one;, by the deed the-debt of McColgan and certain others-enumerated were to be first paid in full, and the residue of the estate was dedicated to the payment of all the other creditors, “without priority or preference, further than the same might exist by law.” According to repeated adjudications by this court, such a-deed cannot be impeached as fraudulent, either at the common law or under the statute of Elizabeth; nor did we understand the counsel for the appellee to assail it upon any other ground than- its supposed violation, of the provisions of the Act of 1834, ch. 193. ⁴⁰¹ By the sixth section of that Act, an insolvent debtor is denied his discharge if it appear that he has conveyed, concealed or disposed of his property to defraud or delay his creditors, or prevent the same from being applied to the payment of his debts, or who has within one “year of the time of filing of his petition, by the conveyance, or assignment of his property, or debts or claims or payment of money, given an undue and improper preference to any of his creditors.” By the seventh section it, is provided, “That any confession of judgment, and any conveyance or assignment made by. any insolvent under this Act, for the purpose of defrauding his creditors, or giving an undue preference, shall he void, and the property or thing conveyed or assigned shall vest in the trustee, and, that, all acts done by a petitioner before his application, when he shall have had no reasonable expectation of being exempted from liabilitjr or execution, on account of his debts or responsibilities, without petitioning for the benefit of the insolvent laws, shall be deemed to be'within the meaning and provision of this section.” We do not construe these sections as avoiding bona fide assignments by debtors, merely because of preferences given to some creditors over others, or as denying the benefit of the Act to an insolvent