Eldridge, Dunham & Co. v. Phillipson
Eldridge, Dunham & Co. v. Phillipson
Opinion of the Court
delivered the opinion of the court.
The plaintiffs in error sued out an attachment against the defendant upon the ground that the latter had disposed of his property, or some part of it, “with intent to give an unfair preference to some of his creditors,” and the principal question presented for our consideration is as to the true construction of that portion of sect. 1420 of the Code of 1871 which authorizes an attachment when the creditor will make oath “that the debtor has assigned or disposed of, or is about to assign or dispose of, his property or rights in action, or some part thereof, with intent to defraud his creditors or give an unfair preference to some of them.” This provision, so far as it relates to “ an unfair preference,” was first introduced into the statutes of the State by the Code of 1857, art. 2, p. 372. It has not as yet received a direct construction in this court, though it has, as we believe, been frequently construed in the Circuit Courts, and generally, if not uniformly, interpreted in accordance with the views which we here announce. We have giveu the question that careful examination which its importance demands. The right of a debtor, insolvent, or in failing circumstances, to give a preference to one or more of his creditors, if it be bona fide, and with no intent to secure .a benefit to himself, is a firmly established rule in the jurisprudence of this State. See Farmers’ Bank v. Douglas, 11 Smed. & M. 469 ; Ingraham v. Gregg, 13 Smed. & M. 22; Hunt v. Knox, 34 Miss. 656 ; Mangum v. Finucane, 38 Miss. 354 ; Wright v. Henderson, 7 How. 539. All of which cases were decided in reference to transactions prior in date to the Code of 1857. Since that time the rule has been also frequent!}' recognized in this court. See Savage v. Dowd, 52 Miss. 278 ; Surget v. Boyd, 57 Miss. 485 ; Kaufman v. Whitney, 50 Miss. 103.
The provision under consideration must be construed with
We conclude, therefore, that the word “ unfair,” as used in the statute, is the exact synonym with “ fraudulent ” or “ illegal . ’ ’ The correctness of this view is conclusively demonstrated by the consideration hereinbefore alluded to, viz.: that when the statute makes the debtor’s disposition of his property the ground of an attachment against his estate, it in every instance designates a disposition which the law prohibits the debtor to make. It is the illegal conduct of the debtor in making, or attempting to make, an assignment of his property prohibited by law, and therefore invalid, which subjects him to this harsh and summary proceeding. Such assignments are also invalid, and will be annulled, except only where the assignee can show he has parted with present value for it, in entire ignorance of
The charges given to the jury were in accordance with this view, and are coxTcct.
The evidence was contradictory, and while the preponderance was probably in favor of sustaining the attachment, the jury believed the contrary, and we cannot say their verdict was so clearly wrong as to authorize us to set it aside.
The judgmoxxt is affirmed.
Reference
- Full Case Name
- Eldridge, Dunham & Co. v. T. H. Phillipson, Surviving Partner
- Cited By
- 6 cases
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- Published
- Syllabus
- 1. Attachment. “ Unfair preference.” A question of law. One of the grounds of attachment under the Oode of 1871 was that “ the debtor has assigned or disposed of, or is about to assign or dispose of, his property or rights in action, or some part thereof, with intent to defraud his creditors or give an unfair preference to some of them.” Whether a preference of a creditor by his insolvent debtor is “unfair” within the meaning of this sta'ute is not a question of fact to be left to the jury in a case, but is a question of law, to be determined by the rules laid down by the courts ns the law of the land, and to be solved by instructions of the trial judge applied to the facts proven in evidence. 2. Same. What is, and what is not, an unfair preference. No preference of a creditor by an insolvent debtor is “unfair,” under the statute above quoted from, unless it be fraudulent or illegal. And where the preference of a creditor by his insolvent debtor is bona fide, and neither expressly nor by implication, of circumstances reserves an interest in the property, or-something to be given in lieu thereof, to the debtor or a volunteer under him, it is valid in law; and the fact that the debtor may hope, through relationship, or from the generosity and friendship of the preferred creditor, that he will at a future time derive some benefit from the preference made, does not vitiate the same. The right to make such preference results from the dominion which the debtor, as owner, has over his property, and is a part of his proprietorship. 3. Same. Meaning of “ unfair.” Its omission from the Code of 1880. The word “unfair,” as used in the statutory provision above quoted, is synonymous with “fraudulent” or “illegal;” and the clause in that provision, “ with intent to give an unfair preference,” was surplusage, and its omission from the Code of 1880 leaves the law as it stood before.