Benoist v. Darby

• Decision Date: 31 October 1848
• Citation: 12 Mo. 196
• Parties: BENOIST v. DARBY, ASSIGNEE OF ANDERSON, USE OF CAMDEN.
• Court: Missouri Supreme Court

12 Mo. 196

BENOIST

v.DARBY, ASSIGNEE OF ANDERSON, USE OF CAMDEN.

Supreme Court of Missouri.

October Term, 1848.

APPEAL FROM ST. LOUIS CIRCUIT COURT.

GAMBLE & BATES, for Appellant.

1st. The legal title to the choses of the bankrupt passed to the assignee, by operation of the Bankrupt act, § 3; see 10 Mo. R. 57; and the same law continuing their assignable quality, by authorizing the assignee to sell them--§ 9. The same title that he gets by the decree in bankruptcy and by his own appointment, he transfers by the sale. The common law rule that things in action are not assignable, applies as well to the transfer to the assignee as from him, and so if one assignment is merely equitable, so also is the other. And therefore, the suit should have been brought in the name of Camden, the last purchaser, or Anderson, the first one. 5 Mo. R. 198. But the Bankrupt law governs the whole estate, and the common law rule does not apply to it. The question could not arise under the English bankrupt laws, for none of them I believe, authorize the assignee to sell the choses. He must collect and administer the fund himself.

2nd. The transfer of the goods by Anderson to Reilly was by express contract, and in part payment of Anderson's debt to Benoist & Hackney. It was a sale and transfer of the goods to Reilly, for the consideration of a credit on the owner's debt to Benoist & Hackney. Neither Benoist nor B. & H. ever got the goods; they only undertook to pay for goods gotten by Reilly, and so there is no general implied promise to pay for them, but only the special agreement proved, and that agreement was fulfilled at the time. A promise to pay would have been void by the statute of fraud.

3rd. But if it must be considered as a sale to Benoist, it is abundantly proved that it was Benoist & Hackney, and not Benoist alone. By the express and only agreement, the goods were to be furnished to Reilly and paid for by a credit on B. & H.'s account, which was done at the time.

4th. The court below was wrong in instructing for a recovery, on the assumed ground that the sale of the goods was in fraud of the Bankrupt law. That assumption is against the state and character of the action. On that assumption the assignee shoold have disaffirmed the sale, and sued for the goods. He cannot declare the sale fraudulent and void, and yet sue for the stipulated price of the goods, as on a valid sale. If he affirm the sale, then it stands with all its legal concomitants; and 1, it was a sale to Reilly and Benoist & Hackney, only oral guarantors. 2. The price is paid according to the terms of the express contract. 3. There is an overwhelming setoff. In support of this point Mr. Whittlesey has cited a multitude of cases. I refer to but two or three of them. 4 Term R. 211; Smith v. Hodson, 8 Taunt. 490.

5th. The commissioner in bankruptcy is part of the legal means and machinery of the bankrupt court. He allowed and setoff the smaller account in diminution of the claim of B. & H. against the bankrupt, and this is a flat bar as to that account. If not, the bankrupt estate gets the account twice paid.

PRIMM & WHITTLESEY, on same side.

1st. Has the plaintiff, Darby, a right to sue? By the Bankrupt act, all the property of a bankrupt is by the act of bankruptcy vested in the assignee. Bankrupt act, §§ 3, 5, Stat. U. S. 443. By section 9, the assignee is authorized to sell the property assigned and the choses in action. By the order of the court the assignee sells the choses in action, and Camden becomes the purchaser of the account. It is sold by authority of law, in virtue of an order of court. The appellant contends that the title vested in Camden as the purchaser, and the suit should have been brought in his name. By the English law the assignees collected the choses in action of the bankrupt; by our law the assignee is authorized to sell them.

2nd. Could the defendant below set up the statute of limitations as a bar? By the act of 1847, p. 108, § 5, parties are allowed under the general issue to set up any matter of defense without regard to the nature of the action. This act was in effect at the time of trial, and as a consequence the defendant could avail himself of any defense he might have, under the general issue. A law applies to every thing in existence at the time it takes effect, unless specially excepted.

3rd. The plaintiff having brought an action of assumpsit for the goods sold, is barred from denying the contract made with Anderson for the bankrupt by the defendant, and having sued for the price of the goods, the defendant is entitled to show that they have been paid for, and to show a set-off equal to or greater than the plaintiff's demand. See Smith v. Hodson, 4 Tenn. R. 211; 2 Smith's Ld. Cases, 81 and notes; Rose v. Hart, 8 Taunt. 944; 2 Smith's Ld. Cases, 172 and notes. The case of Smith v. Hodson is almost precisely parallel with this, and its principle, that a party cannot blow hot and cold, affirm part of a contract and deny another part, is asserted in many cases. The plaintiffs having asserted and set up a contract, cannot afterwards allege against the plea and defense of payment and set-off, that the transaction was in fraud of the Bankrupt law and intended to secure a fraudulent preference. In Smith v. Hodson it was stated that the agreement was in fraud of creditors, and yet the court say the assignee cannot blow “hot and cold,” as they have treated it as a contract of sale, they must pursue it through all its consequences, all of which is that the party may set up the same defense he might have used against the party himself. See the opinion of Lord Kenyon; see Wilson v. Poulter, 2 Strange, 859; Billow v. Hyde, 1 Ath. 128; Birch v. Wright, 1 Term R. 373; Thorpe v. Thorpe, 3 Barn. & Ald. 580; Brewer v. Sparrow, 7 Barn. & Cres. 310. Set-off against bankrupt's assignees, see Rose v. Hart, 8 Taunt. 499; Ex-parte Deese, 1 Atk. 228; Dickson v. Cass, 1 Barn. & Ald. 343; Hawkins v. Whitten, 10 Barn. & Cres. 217; Atkinson v. Elliott, 7 Term R. 378; Sheldon v. Rothschild, 8 Taunt. 156; Hulme v. Muggleston, 3 M. & Welsby, 30; Bankrupt act, 5 Stat. at Large, 445; Greene v. Chickering & Mackay, 10 Mo. R. 109.

4th. The transcript of the proceedings in bankruptcy offered in evidence was incomplete, as appeared from the testimony of Darby, from the transcript of the proceedings of the commissioner in bankruptcy and the certificate of the clerk does not set out that it is a full and complete transcript. The transcript of a record should be full and complete. Vance v. Reardon, 2 Nott & McCord, 299; Ferguson v. Harwood, 7 Cranch, 408; 1 Stark. Ev. 192; Bac. Abr. Evidence F. 610; 3 Ins. 173; Rex v. Smith, 8 Barn. & Cres. 341. If this transcript were excluded the plaintiff could show no right to recover, and the court would have been bound to instruct the jury that the plaintiff could not recover on the case made out by him.

5th. John B. Camden was a good witness for the defendant. He was not in fact a party to the record, and his interest was adverse to the party calling him, and if that party chose to waive the objection and call him as a witness, Camden could not refuse to be sworn. This point seems so plain as hardly to require the citation of authorities.

6th. The court erred in allowing S. J. Bacon to testify as to his opinion as to Anderson's solvency or circumstances. The object of this testimony was to bring home to Benoist, the defendant, notice of Anderson's insolvency. The evidence was illegal in any case, and especially in this case, for the fact of his knowledge could not affect the matter, when the assignee recognized the contract and sued upon it. Opinion is not evidence except in the case of experts, testifying as to something peculiar to their class or profession, as physicians, lawyers, &c. Reputation is not evidence except as to matter of general notoriety or affecting a class of persons. 1 Stark. Ev. 153 and cases there cited; 1 Stark. Ev. 30, 33, 34.

7th. Points involved in the motion for new trial and the instructions given and refused are involved in the points already made. The court erred in allowing interest from the day of sale, and the damages were excessive.

8th. As to the sum of $190, the price of the goods purchased by Benoist, the amount having been allowed as a credit against the estate of Anderson in the account allowed by Watson, the commissioner in bankruptcy, the plaintiff is estopped from claiming it, as it had already been litigated and settled by the judgment of a court having proper jurisdiction, and its decisions final, more especially against a party claiming against the decision to which by law he was a party. Authorities are not needed to show that a judgment between parties is an estoppel against any suit or claim between the same parties. See Vorhees v. Bank United States, 10 Peters 449; McNair v. Biddle, 8 Mo. 264; Thompson v. Tolmie, 2 Peters, 257.

9th. The defense of indebtedness and set-off was a good defense under the general issue, as was decided by this court in the case of Greene v. Chickering & Mackay, 10 Mo. 109; Carr v. Hencliff, 4 Barn & Cres. 547.CROCKETT & BRIGGS, for Appellee.

1st. That the sale from Anderson to Benoist was void under the 2nd section of the Bankrupt law. Dennet v. Mitchel, Com. Law Reporter, 16; In-re Alonzo Pearce, Com. Law Reporter, 261; McLean, Assignee, &c., v. Lafayette Bank, West. L. Jour. for Oct. '43, 15; McLean, Assignee, v. Johnson, West. L. Jour. for Jan. '44, 189.

2nd. That the suit was properly brought in the name of Anderson, assignee, notwithstanding the sale to Camden of the account sued upon; the said account not being assignable in law so as to authorize a suit in the name of Camden. See 2nd and 3rd sections Bankrupt act.

3rd. That the statute of limitations cannot be relied upon by the plaintiff in error, because he neither pleaded nor gave notice of such defense, and it is not admissible under the general issue.

4th. That the interregatory...