Opinion
(June Term, 1840.)
In equity a distinct appropriation and delivery over by a debtor of his choses in action for the benefit of one of his creditors is an assignment of them, and will prevail against a subsequent assignment by deed of all his choses in action to another creditor; for, as in neither case is the assignment a transfer of the legal interest in the choses in action, that which is in equity an assignment first in point of time will prevail.
An assignment by deed of all a debtor's choses in action for the benefit of one of his creditors will not entitle that creditor to claim money not the proceeds of such choses in action paid subsequently by the debtor to another creditor.
UPON the pleadings and proofs in this case, it appeared that on 27 April, 1837, the defendant John Atkinson executed to the plaintiffs, as trustees of sundry creditors of the said John, and for securing the payment of debts due to these creditors, a deed, whereby he assigned to the said plaintiffs a large quantity of produce, several specific articles of personal property, and then, by general words, "all the goods, wares and merchandise in his store, and all his book debts, bonds and notes, of whatever description, and judgments." In the month of December, 1831, the said John had intermarried with Mrs. Esther J. Tyson, a widow lady, possessed of considerable personal estate. Before this marriage all her personal property was duly conveyed, with the consent of the said John, to the defendant James J. Horne, as a trustee, to hold for the use of the said Esther until the marriage, and from and after the solemnization thereof, then in trust, to permit her, notwithstanding her coverture, to take all the profits thereof to her separate use, with a power in the said Esther to dispose of the whole of the said property by instrument in nature of a deed or will; and in the event of no disposition being made by her, to hold to the use of the said Esther's then child, and of any other which she might have. In 1834 or 1835 the defendant John, being desirous to raise money to carry on his mercantile operations, proposed to his wife to sell some of the negroes included in her marriage settlement, to which she assented, upon condition that the money so raised should be deemed a loan from her to him, to be repaid at a convenient time thereafter, and to be reinvested in other (21) negroes. The negroes were accordingly sold by the said Atkinson and his wife, and the money so raised was appropriated to his mercantile engagements, but never refunded or reinvested. A few days before the execution of the assignment to the plaintiffs, the said Atkinson, conscious that his embarrassments were becoming insuperable, delivered unto John A. Vines (Horne, his wife's trustee, then residing at a considerable distance) a number of notes and other claims, to be collected for and applied in part satisfaction of this debt, due to his wife; and some time after the execution of said assignment to the plaintiffs, the said Atkinson made a formal assignment of these and others to the said Horne, and paid over to him the sum of $265 in cash, which, with the choses in action so transferred, covered the amount of the said debt.
The Attorney-General for the plaintiffs.
Iredell for the defendants.
The plaintiffs, by their bill, insisted that the assignment to them was prior to the assignment of Horne, and required that he account to them for the choses in action thus transferred to him, and the money paid therewith.
The plaintiffs and Horne are both trustees, and both represent creditors of the defendant Atkinson. Neither of the assignments, as it regards the choses in action, transfers the legal interest — and in equity a distinct appropriation and delivery over by the debtor of the choses in action, for the benefit of his creditor, is an assignment thereof. The Court therefore declares that the defendant Horne is entitled to retain so much of these choses in action, or of the proceeds thereof, as were actually delivered to John A. Vines before the execution of the assignment to the plaintiffs, but must account to them for the residue thereof.
As to the money, the plaintiffs have no claim thereto, unless it was the proceeds of the choses in action or other property embraced in their assignment.
There must therefore be an inquiry, to ascertain which of the choses in action assigned to Horne were delivered to (22) Vines before the date of the assignment of the plaintiffs, and whether the money paid over to Horne was in whole or in part of the proceeds of property assigned to the plaintiffs.
PER CURIAM. Decree accordingly.
Cited: Miller v. Tharel, 75 N.C. 152; Bresee v. Crumpton, 121 N.C. 124.