Lazarus v. Camden National Bank

• Decision Date: 16 October 1897
• Citation: 42 S.W. 412,64 Ark. 322
• Parties: LAZARUS v. CAMDEN NATIONAL BANK
• Court: Arkansas Supreme Court

42 S.W. 412

64 Ark. 322

LAZARUS v. CAMDEN NATIONAL BANK

Supreme Court of Arkansas

October 16, 1897

Appeal from Ouachita Circuit Court CHARLES W. SMITH, Judge.

Judgment affirmed as to property assigned by John Lazarus and as to other property reversed.

Geo. W Murphy and Gaughan & Sifford, for appellants.

Exemptions may be selected after assignment (4 Lawson, Right & Rem. § 96; Burrill, Assignments, § 96; 59 Miss. 80; 15 Mo.App. 544; 85 Mo. 23; 100 Pa.St. 580; 36 P. 195; 12 Mich 180; 19 So. 344; 24 S.E. 103; 64 N.W. 78), even in cases where the assignment purports to carry all of assignor's property, and there is no reservation of exemptions mentioned, 60 Ark. 1; 57 Ark. 333. The withdrawal of funds by each of the appellants, before the assignment, was not fraudulent, because said amounts were charged against their exemptions claimed after assignment. 42 Ark. 423; 54 Ark. 449; 99 U.S. 119. There was no fraud in the sale of the homestead of John Lazarus to his son, Abraham Lazarus, 38 S.W. 898. A valuable part of the property must be withheld to make it fraudulent. "Lex non curat de minimis. The court erred in not giving the fifteenth instruction asked by appellants.

Smead & Powell, Thornton & Thornton, and Geo. H. Sanders, for appellee.

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) the exemptions claimed, and the manner of claiming them, make the assignment void (66 Ia. 240; 54 Ark. 229; 24 Me. 448; Burrill, Assignments, p. 98); (3) appellants both withheld valuable personal property (53 Ark. 81; 54 Ark. 418; 46 Ark. 405; 57 Ark. 331); (4) the transfer of the homestead of John Lazarus to his son, Abraham Lazarus, was fraudulent and void (53 Ark. 81; 54 Ark. 418; 46 Ark. 405).

OPINION

BATTLE, J.

On the 27th day of December, 1894, Lazarus & Levy, a firm composed of John Lazarus and Joe Levy, for the benefit of its creditors, conveyed to W. F. Avera, as assignee, all of their partnership property; and in the same instrument each member of the firm conveyed all of his individual property, except the property reserved in the assignment. The deed was in the following form:

"Know all men by these presents, that we, Lazarus & Levy, a firm composed of John Lazarus and Joe Levy, being indebted to sundry parties, a list of whom, as nearly as correct as we can make, with the amounts due them, respectively, is as follows, to-wit: [Here they name them, and the amounts of their claims.] And being desirous that all of our property be appropriated towards the payment of our indebtedness, in consideration of the premises before and hereinafter mentioned, and the sum of one dollar to us paid, do hereby bargain, grant, sell and convey to W. F. Avera, of the city of Camden, Arkansas, and to his successors, in trust, the following described property, to-wit: [Here they describe the property.] To have and to hold all of the above and foregoing lands and tenements, with the appurtenances thereunto belonging, to the said W. F. Avera, in trust, and his successors.

"And I, John Lazarus, being desirous that all individual property owned by me shall be appropriated towards the payment of the debts of said firm and partnership, do hereby bargain, grant, sell and convey unto the said W. F. Avera and his successors, in trust, all the personal property of every kind, character and description owned by me, except such household and kitchen furniture and other property, not to exceed in value the sum of five hundred dollars, allowed as exemptions under the constitution of the state of Arkansas. Also, for the considerations and purposes aforesaid, I hereby grant, bargain, sell and convey unto the said W. F. Avera, and his successors in trust, the following real property, lying and being situated in Ouachita county, Arkansas, to-wit: [Here he describes the property.] Also, all other real property by me owned, and not specifically mentioned herein. It is not intended to convey or attempt to convey, by this instrument, lot No. 3 in Woodward block, fronting on the south side of Washington street on which I now reside. All the above lots are situated in the city of Camden, Arkansas. To have and to hold all of the above granted lands, lots and premises, with the appurtenances thereunto belonging, unto the said W. F. Avera and his successors, in trust.

"I, Joe Levy, aforesaid, being desirous that all of the debts owing by the said firm of Lazarus & Levy be paid, do hereby bargain, grant, sell and convey unto the said W. F. Avera and his successors, in trust, all of the personal property of every kind and description, and wherever situated, except such household and kitchen furniture and other property, not to exceed in value the sum of five hundred dollars, allowed as exemptions under the constitution of the state of Arkansas; also the following real property, to-wit: [Here he describes the property.] And all other real estate owned by me, whether herein specifically described or not, except my homestead, upon which I now reside, in the city of Camden, Arkansas. To have and to hold all of said property unto the said W. F. Avera and his successors, in trust, with the appurtenances thereunto belonging.

"All of the above described real stud personal property so conveyed to the said W. F. Avera is in trust that he will, after filing the bond and inventory required by law, dispose of the same in the manner and within the time prescribed by the statutes of the state of Arkansas in cases of general assignments for the benefit of creditors, and he is directed so to do. And the said notes, accounts, evidences of debt and choses in action so assigned and transferred to him are in trust, that he will, and he is directed, after filing his bond and inventory as aforesaid, to faithfully and promptly collect the same. The said W. F. Avers is directed, out of the funds coming into his hands as such assignee or trustee: First. To reimburse himself such necessary and legal expenses as may be incurred by him in the execution of this trust, and pay to himself such commission as may be allowed. Second. To pay the following named parties the amounts set opposite their names respectively, to-wit: [Here they give their names and amounts due them.] Tenth, He shall pay to all the other of our creditors the amounts due them, or pro rata, should he not have in his hands sufficient funds to pay them in full.

"In testimony whereof we have hereunto set our hands on this 27th day of December, 1894.

[Signed] "LAZARUS & LEVY,

"JOHN LAZARUS,

"JOE LEVY."

This deed was properly acknowledged and filed for record on the 27th of December, 1894. On the 28th of the same month the Camden National Bank sued out an order of attachment against the property of Lazarus & Levy, and caused the same to be levied on certain real estate conveyed by the deed of assignment to W. F. Avera for the benefit of their creditors. The homestead of Lazarus was no part of the property attached. The ground of the attachment was that Lazarus & Levy had "fraudulently conveyed their property with the fraudulent intent to defraud their creditors," which was controverted by an affidavit of the defendants. The attachment was sustained by the court, but no reason is given by the court for so doing, except it is stated in the record as follows: "The court, being sufficiently advised as to the law in the case, doth find that Lazarus & Levy, on the 27th of December, 1894, attempted and executed an assignment for the benefit of creditors, and that the parties, Lazarus & Levy, were guilty of fraud in and about the making of said assignment, and were guilty of withholding and reserving certain property which was material to the assignee and to the creditors of the said Lazarus & Levy, and that the attachment should be sustained." But the bank, in its brief on file in this court, contends that the judgment of the court as to the attachment should be affirmed for the following reasons:

"First. Because the assignment was made and delivered, and the possession of the property was delivered, at the same time and as a part of the same transaction.

"Second. The exemptions claimed in said assignment, and the manner of claiming them, was in such way and manner as made the assignment fraudulent and void.

"Third. The withholding of a large amount of personal property from the assignee, on the part of both Lazarus & Levy, rendered the assignment fraudulent and illegal.

"Fourth. The...