Opinion
(Decided 11 April, 1899.)
Assignment — Schedule — Preferred Debts.
1. A schedule of preferred debts, properly verified and filed within the five days limited by law, is good as to all preferences therein sufficiently described, and if any such preferences are valid, the schedule itself is sufficient to support the assignment. Brown v. Nimocks, at this term.
2. Debts invalid for want of proper description are simply eliminated from the schedule and fall back into the class of unpreferred debts. While the requirements as to name of the creditor, amount, date and consideration of his debt are mandatory, they will be reasonably construed in carrying out the law. Preference as to taxes is valid, as it does not come within the intent of the law.
ACTION to vacate an assignment and for injunction and receiver, heard before Robinson, J., at February Term, 1899, of ROBESON.
(403) McLean McLean for plaintiffs.
Patterson McLean for defendants.
This is an action brought to set aside a deed of assignment, executed 1 November, 1897, by the defendant Cottingham to his codefendant, Patterson, as trustee, and for injunction and receiver. The assignment provided for certain preferences which were set out in the schedule filed by the assignor in the office of the clerk of the Superior Court on 5 November, 1897, within the five days prescribed by the statute. On 18 January, 1899, a temporary injunction, or restraining order, was issued by his Honor, Judge Robinson, but on the hearing at February Term of Robeson Superior Court judgment was rendered dissolving the temporary restraining order theretofore granted, and refusing the motion for receiver and injunction.
There appears to be no dispute as to the facts, and the only question argued by counsel was as to the sufficiency of the schedule of preferred debts, and the effect thereon of the invalidity of certain preferences. These questions have been fully considered in Brown v. Nimocks, post, 417, and the principles therein laid down govern the case at bar. We are of the opinion that a schedule of preferred debts, properly verified and filed within the five days limited by law, is good as to all preferences therein sufficiently described, and that if any of such preferences are valid, the schedule itself is sufficient to support the assignment. Those debts, invalid for want of proper description, are simply eliminated from the schedule, and fall back into the class of unpreferred debts. They lost nothing of their previous character as debts, but acquire no preference whatever under the assignment.
It remains for us only to classify the preferences in the schedule before us. Such a preference, to be valid, must set forth the name of the creditor, with the amount, date and consideration of his debt. All of these requirements are mandatory, but they will be reasonably construed in carrying out the true intent and spirit of the law. (404) We think that the preference as to taxes is valid, as it does not come within the intent of the law. Any creditor can easily ascertain their amount and all particulars therewith by reference to a public record, and it would be difficult ever to bring public taxes under the head of feigned or collusive debts. We think that the second preference is also good, which is as follows: "J. A. Eddie, $206; note, date 16 June, 1897, due and payable 16 December, 1897, being the amount due for material for dry-kiln." We hold that, in the absence of any statement to the contrary, the date of the note is presumed to be the date of the transaction, not as an arbitrary rule of law, but because we think the ordinary business man would so regard it, and we would feel that he had complied with the law by giving the date of the note, when the entire transaction took place at the same time. The object of the statute is not to defeat preferences, but to regulate them by requiring the assignor to file in a public office, accessible to all, under the sanctity of his oath, a statement giving such description of the preferred debt as will enable any creditor to conveniently ascertain its bona fides. Neither the schedule nor the deed itself adds anything to the inherent honesty or dishonesty of a debt, but affects only its order of payment. Neither is conclusive of its validity, which can be attacked by any interested party, and, if showed to be feigned or illegal, it would have neither preference nor existence. If properly set out in the schedule, it has only a prima facie right of preference, subject to attack; but if excluded from the schedule, either in fact or by implication of law, its preference is forever lost. There are several preferences which appear to us sufficiently described, but we have shown enough to sustain the schedule and therefore the assignment.
As the judgment of the court below simply dissolved the (405) restraining order theretofore granted, and taxed the plaintiff with the costs of the action, the question of the validity or invalidity of each particular item of the schedule is not properly before us.
As the schedule is good, at least in part, it is sufficient to support the assignment, and his Honor properly refused to interfere in its execution. The judgment is
AFFIRMED.
Cited: Sutton v. Bessent, 133 N.C. 564, 565.