VOLUNTARY ASSIGNMENTS. CHAPTER I ASSIGNMENTS IN GENERAL; VOLUNTARY ASSIGNMENTS FOR THE BENEFIT OF CREDITORS DEFINED AND DISTINGUISHED FROM OTHER MODES AND INSTRUMENTS OF TRANSFER. § 1. Assignments in General.-An assignment is a transfer or setting over of property, or of some right or interest therein, from one person to another; the term denoting not only the act of transfer, but also the instrument by which it is effected. In these senses, the word is variously applied in law. As applied to real estate, an assignment is properly a transfer, or making over to another, of one's whole interest in lands or tenements, whatever that interest may be; but in England it is usually applied to express the 'These appear to be secondary senses of the term, the primary meanings being those of appointment, allotment, specification, or designation; all which are still retained. In the Latin of the old books it is termed assignatio, from which the Scotch assignation has been formed; but the word assignment itself is obviously taken from the Law French. Britt. cc. 34, 83, 103. 'An assignment is properly the transfer of one's whole interest in any estate; but it is now generally appropriated to the transfer of chattels, either real or personal, or of equitable interests. Watkins on Conv. b. 2, c. 9, p. 227. The common-law definition of an assignment is "the transferring and setting over to another of some right, title, or interest in things in which a third party, not a party to the assignment, has a concern and interest." 1 Bac. Abr. 329. See Mr. Justice Isbell, in Cowles v. Ricketts, 1 Iowa, 582. 'The introduction of the word assigns into the old instruments of feudal conveyance, had the effect of conferring on the purchaser the power of alienation. Britt. c. 35; Mirr. c. 1, § 3; 2 Bl. Com. 289. Hence, the proper sense of assignment, in ancient conveyancing, seems to have been alienation by virtue of a previous instrument. This serves to account for the restriction of the term, which has so long prevailed in England, to the sense of the transfer of an interest held under a previous conveyance; the assignor creating no new estate by the assignment, but merely passing or setting over an estate already created, to be held as the assignor himself held it; the assignee being put in his place, or (in the ancient sense of the latter word) deputed for that purpose. See the next note. 1 2 transfer of an estate for life or years. Considered as an instrument, an assignment at common law is a species of deed, and is classed, by Blackstone and other writers, among common-law conveyances of a secondary or derivative character, which also presupposes a conveyance precedent. As applied to personal estate, the term assignment has the same double sense of the act and instrument of transfer. Where an article of merchandise or personal chattel is the subject of it, the act is more commonly termed a sale, and the instrument used to express and authenticate it, a bill of sale. But in other cases of transfer, the term is usually employed to denote both the act and the instrument; the latter being either separately drawn in the form of a deed, or indorsed upon other instruments (such as bonds, policies, etc.), in shorter form; and in cases of transfer of bills of exchange and promissory notes, the assignment is still more compendiously expressed by the mere indorsement of the assignor's name. In many cases, however, no instrument 1 1 Steph. Com. 485. Sir William Blackstone defines an assignment to be "properly a transfer, or making over to another of the right one has in any estate; but it is usually applied to an estate for life or years." 2 Bl. Com. 326. Dr. Wooddesson restricts the proper meaning of the term to "the transfer of the interest which any one has in the unexpired residue of a term or estate for years.” 2 Woodd. Lect. 170, 171. In Cruise's Digest, an assignment is said to be " properly a transfer of some particular estate or interest in lands, but it is usually applied to the transfer of a term for years." Cruise Dig. tit. xxxii (Deed), c. vii, s. 15. The reason of this peculiar restriction of the term to estates for years is to be found in the nature of those estates, which could not be adequately conveyed by a new instrument of the same kind (that is, the lessee or tenant for years could not convey or divest himself of the whole of his estate at once, by a new lease, as a feoffee might by a new feoffment, the idea of a lease implying a reversion of some kind to the lessor on its termination, and of course a continuing interest in the lessor to that extent), but only by setting over the same instrument, and the estate held under it. Hence the distinction, which has become so well established in modern law, between an assignment and a derivative or under lease. In American law, the term assignment, though constantly employed to denote the transfer of a leasehold interest, is not so frequently restricted to that particular sense. 2 See 2 Bl. Com. 310, 324, 326. See 2 Steph. Com. 104; 1 Tucker's Com. (Laws of Virginia), [333] 323, note (a). The resemblances and distinctions between an assignment and a sale will be more fully noticed in § 4. The term assignment is here used in the larger sense of transfer in general. Chitty on Bills (Perk. ed. 1854), [5, 6] 8, [8] 11, 12, [196] 225; Story on Bills, § 17. In practice, however, the term, as applied to the transfer of bills and notes, is generally restricted to such as are not negotiable, as distinguished from the in or writing is used, the title to the property passing by mere delivery. In mercantile transactions, the term assignment is not used in the sense of sale, but rather in contradistinction from it; being confined in its application either to transfers of a special kind, auxiliary to sales, or in completion of them (such as assignments of bills of lading, of policies of insurance, etc.), or to transfers by way of security for or in payment of debts. Indeed, in most of its applications, the term seems to imply the existence of the relation of debtor and creditor; and it is in this latter sense only that these modes and instruments of conveyance are now proposed to be considered. § 2. Voluntary Assignments for the benefit of Creditors defined.-Voluntary assignments for the benefit of creditors are transfers, without compulsion of law, by debtors, of some or all of their property to an assignee or assignees, in trust to apply the same, or the proceeds thereof, to the payment of some or all of their debts, and to return the surplus, if any, to the debtor.2 dorsement of negotiable paper. Shankland, J., in Bump v. Van Orsdale, 11 Barb. 634, 639. In the case of the Bank of Marietta v. Pindall (2 Rand. 465), it was said, "The term indorsement, when applied to bills of exchange negotiable by the custom of merchants, or to paper made negotiable by our statutes, may, ex vi termini, import a legal transfer of the title. But as to bonds and notes not negotiable, the legal title to them passes by assignment only; and as to them, indorsement is not equivalent to assignment; as to them, assignment means more than indorsement-it means indorsement by one party with intent to assign, and an acceptance of that assignment by the other party." Cabell, J., Id. 475; see also, on this point, Jagoe v. Alleyn, 16 Barb. 580; Watson v. Bailey, 2 Duer, 509. 'The term assignment is frequently used in the books to express the transfer of a promissory note by delivery. Edison v. Frazier, 4 Eng. (Ark.) 219, 220; Jackson v. Heath, 1 Bailey, 355; Chitty on Bills (Perk. ed. 1854), 259, note 3, and cases cited ibid.; Hedges v. Sealy, 9 Barb. 214; Bump v. Van Orsdale, 11 Id. 634; Collins v. Knapp, 18 Id. 532; but see Calkins v. Packer, 21 Id. 275; and see Andrews v. Carr, 26 Miss. 577. In Feimster v. Smith (5 Eng. Ark. 494), the term, applied to a bond in pleading, was held to import delivery, ex vi termini. In Andrews v. Carr (ub. sup.) it was held that the words transfer and assign mean, in legal proceedings, a transfer by writing; and that when a party, in pleading, says that he acquired title to a note by assignment, he is understood to mean written assignment, unless he qualifies the meaning of the words. The definition given in the text is approved in Bartlett v. Teah, 1 McCrary, 176, 178. Under the Pennsylvania statute an assignment has been defined to be "a transfer by a debtor of the whole or a part of his effects to some person in trust to pay all of his creditors in like proportion, and to return the surplus, if any, to the debtor." Mr. Justice Lowrie, in Wiener v. Davis, 18 Penn. St. 333. Assignments, in this restricted sense, are distinguished with reference to their subject-matter, as being of all or of part of the debtor's property. The former are known as general assignments, in distinction from partial assignments, by which term the latter are defined. Such assignments are termed voluntary, to distinguish them from such as are made by compulsion of law, as under statutes of bankruptcy and insolvency (the latter being sometimes termed statutory assignments), or by order of some competent court. Assignments, in the sense in which they are here employed, are usually resorted to by debtors who find themselves unable to pay their creditors in full, or the embarrassed state of whose affairs has compelled them to discontinue the transaction of business, and, in some instances, the provisions of the statutes which have been passed by the State Legislatures, regulating and restricting the operation of such assignments, are confined exclusively to assignments made by insolvents or by persons in contemplation of insolvency; but the solvency of the debtor, 'This division of the subject will be found more precisely stated in Chap. VIII. "An assignment of all one's property for the benefit of all one's creditors is clearly a general assignment." Mr. Justice Bennett, in Dana v. Lull, 17 Vt. 390. "A general assignment must include substantially all a man's property; and a partial assignment must omit some substantial portion of the property, and cannot be made to rest upon a mere colorable omission." Mr. Chief Justice Redfield, in Mussey v. Noyes, 27 Vt. 474; Longmire v. Goode, 38 Ala. 577. In the case of The United States v. M'Lellan (3 Sum. 345), the designation of voluntary assignments, as being "for the benefit of creditors, was held to imply a conveyance to trustees for the benefit either of the creditors at large, or of some other creditors than the immediate grantees. Id. 354, 355; and see Smith v. Woodruff, 1 Hilt. 469. 3 Manny v. Logan, 27 Mo. 528. This is quite a different application of the word voluntary from the technical sense in which it is frequently employed, viz., that of being without consideration, or without valuable consideration. In the latter sense, voluntary is sometimes used as synonymous with fraudulent, though in other instances it is distinguished. See Nunn v. Wilsmore, 8 Term. R. 521, 528, 529. Lord Mansfield, in Cadogan v. Kennett, Cowp. 432, 434, and in Doe v. Routledge, Id. 705, 711; 4 Kent's Com. [463] 510; 1 Story's Eq. Jur. § 353; 3 N. Y. Rev. Stat. (6th ed.) p. 145, § 4; and see Wells v. Treadwell, 28 Miss. 717; Lumpkin, J., in Clayton v. Brown, 17 Ga. 217, 222. Mr. Roberts has alluded to the unsettled meaning of the term voluntary in this application. Roberts on Fraud. Conv. 63, 65, 70, 71, 72, 400. Whatever may be the form or character of the instrument to operate as a general assignment it must proceed from the will and be the act of the debtor. Hence the transfer is defined as voluntary. Perry Ins. & Trust Co. v. Foster, 58 Ala. 502, 521. * See these statutes referred to in Chap. II. or writing is used, the title to the property passing by mere delivery.1 In mercantile transactions, the term assignment is not used in the sense of sale, but rather in contradistinction from it; being confined in its application either to transfers of a special kind, auxiliary to sales, or in completion of them (such as assignments of bills of lading, of policies of insurance, etc.), or to transfers by way of security for or in payment of debts. Indeed, in most of its applica tions, the term seems to imply the existence of the relation of debtor and creditor; and it is in this latter sense only that these modes and instruments of conveyance are now proposed to be considered. § 2. Voluntary Assignments for the benefit of Creditors defined.-Voluntary assignments for the benefit of creditors are transfers, without compulsion of law, by debtors, of some or all of their property to an assignee or assignees, in trust to apply the same, or the proceeds thereof, to the payment of some or all of their debts, and to return the surplus, if any, to the debtor.2 dorsement of negotiable paper. Shankland, J., in Bump v. Van Orsdale, 11 Barb. 634, 639. In the case of the Bank of Marietta v. Pindall (2 Rand. 465), it was said, "The term indorsement, when applied to bills of exchange negotiable by the custom of merchants, or to paper made negotiable by our statutes, may, ex vi termini, import a legal transfer of the title. But as to bonds and notes not negotiable, the legal title to them passes by assignment only; and as to them, indorsement is not equivalent to assignment; as to them, assignment means more than indorsement-it means indorsement by one party with intent to assign, and an acceptance of that assignment by the other party." Cabell, J., Id. 475; see also, on this point, Jagoe v. Alleyn, 16 Barb. 580; Watson v. Bailey, 2 Duer, 509. 'The term assignment is frequently used in the books to express the transfer of a promissory note by delivery. Edison v. Frazier, 4 Eng. (Ark.) 219, 220; Jackson v. Heath, 1 Bailey, 355; Chitty on Bills (Perk. ed. 1854), 259, note 3, and cases cited ibid.; Hedges v. Sealy, 9 Barb. 214; Bump v. Van Orsdale, 11 Id. 634; Collins v. Knapp, 18 Id. 532; but see Calkins v. Packer, 21 Id. 275; and see Andrews v. Carr, 26 Miss. 577. In Feimster v. Smith (5 Eng. Ark. 494), the term, applied to a bond in pleading, was held to import delivery, ex vi termini. In Andrews v. Carr (ub. sup.) it was held that the words transfer and assign mean, in legal proceedings, a transfer by writing; and that when a party, in pleading, says that he acquired title to a note by assignment, he is understood to mean written assignment, unless he qualifies the meaning of the words. 2 The definition given in the text is approved in Bartlett v. Teah, 1 McCrary, 176, 178. Under the Pennsylvania statute an assignment has been defined to be "a transfer by a debtor of the whole or a part of his effects to some person in trust to pay all of his creditors in like proportion, and to return the surplus, if any, to the debtor." Mr. Justice Lowrie, in Wiener v. Davis, 18 Penn. St. 333. |