James v. The Mechanics' Nat. Bank

• Decision Date: 18 October 1879
• Citation: 12 R.I. 460
• Parties: SAMUEL JAMES, Assignee, v. THE MECHANICS' NATIONAL BANK et als.
• Court: Rhode Island Supreme Court

12 R.I. 460

SAMUEL JAMES, Assignee, v. THE MECHANICS' NATIONAL BANK et als.

Supreme Court of Rhode Island.

October 18, 1879

An assignment made under Public Laws R.I. cap. 723, § 1, of June 20, 1878, by an insolvent debtor or a debtor in contemplation of insolvency, does not avoid preferences given by the assignor to his creditors within sixty days prior to the assignment.

Such an assignment is not a proceeding against the debtor within the meaning of said chapter 723, § 4.

Such an assignment is a voluntary one, and the assignee takes only the rights of the assignor.

BILL IN EQUITY to set aside a transfer of personalty. On demurrer to the bill.

Public Laws R.I. cap. 723, § 1, of June 20, 1878, provides: " Whenever the property of any debtor shall have been attached or levied upon by any creditor, the debtor may, at any time before such property shall be sold, and the proceeds thereof applied to the payment of the claim or judgment upon which such attachment or levy shall have been made, within sixty days after such attachment or levy, suspend such attachment or levy by making and having recorded in the records of the town or city where the assignor resides, or where any of the real estate is located, an assignment of all the property and estate of such debtor not exempt by law from attachment, to some citizen of this State for the equal benefit of all his creditors in proportion to their respective claims, except as is provided in the third section hereof. And all attachments and levies so suspended shall be dissolved at the expiration of thirty days thereafter, unless otherwise ordered by the Supreme Court in some proper proceeding."

Section 3 of the same chapter provides: " No assignment hereafter made for the benefit of creditors shall give to any one creditor any preference over the claims of any other creditor except the creditor be the United States or the State of Rhode Island, or for the wages of labor performed within six months previous to such assignment, not exceeding one hundred dollars to any one person."

Section 4 of the same chapter is recited below in the opinion of the court.

The bill charges that one Stephen Brownell, being indebted to the respondent bank on notes maturing but not matured, executed September 3, 1878, a power of attorney to one of the clerks of the bank to transfer his stock in it to one Tingley, in trust to protect the bank, Tingley being the cashier. This power of attorney was dated August 30, 1878. September 6, the creditors of Brownell attached his stock, and the same day Brownell's attorney, at his direction, transferred the stock to Tingley in trust. November 4, 1878, Brownell made an assignment to Samuel James of all his...