Younkin v. Collier

• Decision Date: 24 June 1891
• Citation: 47 F. 571
• Parties: YOUNKIN v. COLLIER et al., (SMITH, Garnishee.)
• Court: U.S. District Court — Southern District of Iowa

47 F. 571

YOUNKIN v. COLLIER et al., (SMITH, Garnishee.)

United States Circuit Court, S.D. Iowa, Eastern Division.

June 24, 1891

John P Hornish and James H. Anderson, for plaintiff.

F. T Hughes and James C. Davis, for garnishee.

SHIRAS J.

From the record in this cause it appears that December 16, 1890 the plaintiff, Joseph Younkin, brought suit in this court aided by the issuance of a writ of attachment, against Alexander Collier, Hugh Robertson, and B. F. Hambleton, partners under the firm name of Collier, Robertson & Hambleton, the attachment being levied by garnishing J. F. Smith. On or about January 21, 1891, judgment was entered in the main cause against the defendants therein for the sum of $9,963.38 and costs, and, the answer of the garnishee having been duly taken and filed, issue thereon was taken by the plaintiff according to the method provided in the statutes of Iowa, and the questions thus presented are those now before the court for determination. From the evidence submitted by the respective parties, it appears that on and prior to the 10th day of December, 1890, the firm of Collier, Robertson & Hambleton was engaged in the wholesale grocery business at Keokuk, Iowa; that on said 10th of December, 1890, two chattel mortgages were executed by said firm upon the stock in trade, fixtures, notes, accounts, and other choses in action of said firm, to secure payment of the sums due various creditors named in each mortgage, the conveyances being in form to J. F. Smith, trustee; that on the same day said firm executed a mortgage to J. F. Smith, trustee, upon the westerly 40 feet of lot 4, in block 25, in the city of Keokuk, Iowa, to secure the amounts due the creditors therein named; that on the 16th day of December, 1890, the said firm executed a deed of general assignment to J. W. Summers, as assignee, for the benefit of their creditors; that on the 10th day of December, 1890, and prior to the execution of the mortgages above named, the said firm was insolvent; that immediately on the execution of said chattel mortgages the trustee therein named took possession of the personalty therein described, and has since converted the same, or a large portion thereof, into money. On the part of plaintiff, it is contended that the mortgages executed to J. F. Smith, as trustee, in effect covered all the available property belonging to the firm of Collier, Robertson & Hambleton, and therefore in fact constituted a general assignment of their property, but, being made for the benefit of a part only of their creditors, it is void under the Iowa statute, because it thus gives a preference to certain creditors, instead of being for the common benefit of all.

Assuming, without so deciding, that the mortgages were intended to cover all the available property of the firm, that fact does not necessarily make them in effect a general assignment, even if the mortgagors were then insolvent, and executed these instruments in view of that fact. The rule of construction to be followed in determining the character of the conveyances in question is that to be derived from the decisions of the supreme court of Iowa. It is not to be denied that if the language used in Burrows v. Lehndorff, 8 Iowa, 96, is to be construed without limitation, it would justify the contention of plaintiff that these mortgages should be held to constitute a general assignment; but the rule laid down in this case has been greatly limited by the subsequent decisions of the supreme court of Iowa. In Lampson v. Arnold, 19 Iowa, 479, the whole subject is discussed at length, and the conclusion reached that--

'This statute, it will be observed, does not limit or affect the right of an insolvent debtor, or one contemplating insolvency, or, indeed, any other, to sell or mortgage a part or all of his property to one or more of his many creditors in payment or security of a particular debt or debts; but this is true, although such sale or mortgage may, practically, defeat all other creditors than the grantee from collecting their demands. Nor does the statute prohibit or interfere with the right of the debtor as it existed before the statute to execute a partial assignment: In other words, the statute does not expressly or by implication extend any further or apply to any instrument or conveyances other than a general...