United States v. Hoyt

The plaintiffs are .entitled to charge the assignees as their trustees, and to compel the application of the property assigned, to the satisfaction of their judgment, as the property proceeded from the debtor and was designed to be a counter security against the demand now in judgment. The assignees did not receive it in their own right, but as the means of satisfying the debt in question, whenever it should become fixed. On these facts, a trust was created by implication of law, which a court of equity will execute, either by subjecting the property directly to a seizure on execution. or by compelling the trustees to dispose of it under the supervision of the court, with a view to the appropriation of its proceeds towards the payment of the judgment.

The conveyance made by Hoyt to the trustees was a voluntary assignment, to which the plaintiffs were neither parties nor privies, and was intended as an indemnity to the sureties on Hoyt’s official bond. It was revocable by the assignor, with their assent, at least until notice of it had been communicated to the plaintiffs and they had affirmed it. Because, where a person without the privity of his creditors, and without consideration, makes a disposition of his property as between himself and trustees, for the payment of his debts, he is regarded as merely directing the mode in which his own property shall be applied for his own benefit, and the creditors named in the instrument are *406named for the purpose of showing how the trust property is to be applied. Hence, the right of the plaintiffs in this ease to seize upon the assigned property and appropriate it to the satisfaction of their judgment, under the implied trust in their favor, did not attach until the filing of their bill, that being, for aught that apjjears in the pleadings or proofs, the first step taken by them in affirmance of the trust. Therefore, any disposition of the proceeds made prior to that time with the consent of the assignor and of the sureties was valid, and the proceeds so disposed of need not be accounted for by the trustees in the settlement of their accounts.