Aaronson v. Deutsch

Decision Date25 July 1885
PartiesAARONSON v. DEUTSCH.
CourtU.S. District Court — Eastern District of Arkansas

T. B Martin, J. M. Taylor, and Cohn & Cohn, for plaintiff.

W. E Hemingway, for defendant.

CALDWELL J.

This case turns upon the validity of a deed of assignment for the benefit of creditors. Much of what is said in the opinion i the case of Rice v. Frayser, ante, 460, is applicable to this case also. There are some points of difference which will be noticed. The plaintiff claims the deed of assignment is fraudulent in fact, and that it is void by reason of an agreement, carried into effect, to transfer the possession of the property to the assignee upon the delivery of the deed, and before the latter had given the bond and filed the inventory required by law. There is much in the evidence tending to show that the assignment, which prefers a relative of the debtor for a sum sufficient to swallow up the whole estate, was one step in a scheme to delay and defraud his creditors. It does not matter that the assignee was not a party to this scheme. He does not stand on the footing of a purchaser for value, and his participation in the fraudulent purpose does not have to be shown. Put, in fact, he did agree to and participate in an act which was in violation of the statute, and therefore a fraud upon the law.

It was the understanding of the parties to the deed that possession of the assigned property should be delivered to the assignee upon the execution and delivery of the deed, and before the assignee had qualified by giving bond and filing an inventory. Accordingly, immediately after the execution of the deed the assignor put the assignee in possession of the property. The key to the store-house containing the property, and the property itself, was delivered to the assignee; the assignor withdrew from the place and abandoned all watch or care over the property, leaving the assignee to exercise absolute and unrestricted dominion over it. The assignee had not given bond and filed the inventory up to the time the goods were attached. The contention of the learned counsel for the defendant is that, because this illegal understanding and action of the parties was not in terms provided for in the deed, the validity of the assignment is not affected thereby; and that the wrongful possession of the assignee was a matter occurring subsequent to the execution of the deed, and cannot affect its validity. The mere act of taking possession was subsequent to the execution of the deed; but it was done in pursuance of an understanding had at the time of the execution of the deed, and when that fact is shown, its legal effect is the same as if the deed had provided for it. When the parties to the deed enter into an agreement to do an act in violation of the requirements of the statute of assignments, and that agreement finds expression in the deed, the instrument is fraudulent and void in law upon its face. Where such an agreement is made, but is not disclosed on the face of the deed, it must be proved; and when it is proved, and it is also shown that the parties are carrying out their illegal purpose, the effect upon the validity of the assignment is precisely the same as if the illegal purpose had been declared on the face of the deed.

The rule which the defendant seeks to invoke, that a deed valid in its inception will not be rendered invalid by any subsequent fraudulent or illegal act of the parties, has no application where the fraudulent or illegal act is the consummation of an illegal agreement made contemporaneously with the deed; and the rule must be taken as not intended to deny that such subsequent acts may reflect...

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10 cases
  • Lazarus v. Camden National Bank
    • United States
    • Arkansas Supreme Court
    • 16 Octubre 1897
    ...The assignment is fraudulent and void, because (1) the assignee was given possession before he executed his bond and filed his inventory (24 F. 465; ib. 460; 53 Ark. 88); (2) exemptions claimed, and the manner of claiming them, make the assignment void (66 Ia. 240; 54 Ark. 229; 24 Me. 448; ......
  • First Nat. Bank v. Prager
    • United States
    • West Virginia Supreme Court
    • 1 Marzo 1902
    ... ... in the assignment, and frequently furnish very convincing, ... and sometimes very conclusive, evidence upon that ... point." And in Aaronson v. Deutsch (C. C.) 24 ... F. 465, it is held, "The rule that a deed valid in its ... inception will not be rendered invalid by any subsequent ... ...
  • Simmons Hardware Co. v. Rhodes
    • United States
    • U.S. Court of Appeals — Eighth Circuit
    • 15 Junio 1925
    ...as a part of the assignment, the effect upon the assignment is the same as though it was found written therein. In Aaronson v. Deutsch (C. C.) 24 F. 465, Judge Caldwell, delivering the opinion, says: "And a deliberate agreement, in or out of the deed, made at the time and carried into effec......
  • Beal Burrow Dry Goods Co. v. Baker
    • United States
    • Oklahoma Supreme Court
    • 16 Abril 1929
    ... ... upon the assignment is the same as though it was found ... written therein. In Aaronson v. Deutsch (C. C.) 24 ... F. 465, Judge Caldwell, delivering the opinion, says: ... 'And a deliberate agreement, in or out of the deed, made ... ...
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