Opinion
March Term, 1896.
George L. Bachman, for the appellant.
D.B. Backenstose, for the respondents.
The main contention of the appellant's counsel is that this assignment is void upon its face as it purports to be given to Peel, "deputy sheriff," and for the further reason that there is no beneficiary named in the assignment, and that, therefore, the instrument cannot be held to be an assignment in trust.
This is the fundamental question to be decided upon this review, and upon its decision rests the disposition of this case. There are other exceptions raised, but, upon examination, I am satisfied that they were properly disposed of by the referee.
I am of the opinion that the finding of the referee, that this assignment was a valid and legal instrument, must be sustained.
By this assignment a trust of personalty was created, and the sheriff became the trustee of an express trust for the benefit of the judgment creditors in the executions named in the assignment.
A trust of personalty may be created for any purpose not forbidden by law or contrary to public policy, nor is any formal or written instrument or memorandum thereof necessary. ( Day v. Roth, 18 N.Y. 448; Gilman v. McArdle, 99 id. 451.)
Even though the property be transferred by an instrument absolute in form, the trust may be shown by parol evidence. ( Chace v. Chapin, 130 Mass. 128.)
The subject-matter and the purpose of the trust, and the persons who are to take the beneficial interest, may be ascertained by parol proof. ( Kramer v. McCaughey, 11 Mo. App. 426.)
As a general rule, all persons may be trustees; and there is no rule of law or statutory provision, disqualifying a sheriff from taking an assignment of a claim from a judgment debtor, in trust, for the benefit of the judgment creditor in whose favor he holds an execution, and to collect the claim and apply the proceeds in payment or satisfaction of the execution which he holds in his hand. When the trust, becomes executed by assignment or delivery of the claim, it is irrevocable by the assignee so long as the judgment remains unpaid, nor can it be questioned by his creditors except upon the ground that it was made to hinder, defeat, delay or defraud them. (See Rogers Locomotive Works v. Kelly, 19 Hun, 399.)
The trustee is bound to hold the claim or securities assigned to him and to apply the proceeds to the benefit of the beneficiary. ( Morris v. Webb, 45 N.Y. Super. Ct. 305.)
The assignee, by acceptance of the assignment, becomes a trustee for the persons designated, to the extent of the moneys directed to be paid to them, and, upon a collection of the claim, an action will lie against him by them for the moneys so directed to be paid, and a parol agreement, made at the time of the assignment of the claim, as a part of the transaction, that a certain person should be paid a certain sum out of the proceeds of the claim when collected, may, although it be not embodied in the written instrument, be proved on behalf of such person, he not being a party to the instrument. ( Warburton v. Camp, 55 N.Y. Super. Ct. 290.)
It is a maxim of equity that a trust will not be permitted to fail for want of a trustee; so that, if the person named is incompetent, another will be appointed. The incompetency or disqualification of the person cannot affect the validity of the trust, nor impair its enforcement. The sheriff may become a trustee independently of his official character, and is personally responsible for the execution of the trust. The assignment may be deemed to have been made to the incumbent of the office in his individual and not in his official capacity. We are unable, therefore, to perceive upon what legal or equitable ground the other creditors have any claims upon these accounts, or their proceeds. (See Bump on Fraud. Conv. 213, 405; Dunham v. Whitehead, 21 N.Y. 131.)
Indeed, the transaction may be considered as equivalent to a levy by the sheriff.
The sheriff, by virtue of this assignment, became a trustee of an express trust, and may sue in his own name for the benefit of the real party in interest, and so may the latter sue in their own names. ( Cummins v. Barkalow, 4 Keyes, 514, 524; Wetmore v. Hegeman, 88 N.Y. 69.)
The judgment should be affirmed, with costs.
All concurred.
Judgment affirmed, with costs.