fraudulent intent. Every conveyance to trustees interposes obstacles in the way of the legal remedies of the creditors, and may, to that extent, be said to hinder and delay them." The same distinction between the result and the object of an assignment was made in the Florida case of Bellamy v. Bellamy's Adm'r.' In Michigan, in the case of Hollister v. Loud, the language and object of the statute were commented on by Wing, P. J., from whose opinion the following are extracts: "It must be shown, then, by the complainant, that the parties to the deed entered into it as a device for the purpose of hindering, delaying, or defrauding the creditors of the grantors; that it was not intended by the parties to it, and especially the assignors, to carry its provisions into effect bona fide, but that it was intended as a means to keep the property from the creditors, or this creditor in an especial manner, and from motives of malice or guile; or that the deed of assignment contains provisions or trusts which are prohibited by law, on account of which, it is to be deemed fraudulent and void.s * If the effect of a conveyance be to hinder, delay, or obstruct creditors, it is not therefore void. To render it fraudulent, it must be done, with the intent to hinder, delay, or defraud; but if made with no such intent, but with honest motives, and with the higher or nobler intent and purpose of paying all equally, or of providing for those who are the most meritorious, it will be sustained. * *The object of the statute was not to prevent such conveyances as might operate to hinder or delay creditors, but only such assignments as were in their inception and intention fraudulent and void. It is the fraudulent intention, the mala mens, with which the conveyance is made that constitutes the fraud against which the denunciations of the statute are directed." 4 In Indiana, in the case of Church v. Drummond, the court (Stuart, J.), say: "Every assignment operates more or less to delay creditors. If mere

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delay of creditors were conclusive on the question of fraud, every assignment would be fraudulent."

In a case in Illinois,1 it is said that "the placing of property in the hands of assignees for any other purpose than to distribute it or its proceeds among creditors, must necessarily have the effect to, in some degree, hinder and delay creditors in the collection of their debts." The assignment is valid only when it is made for the benefit of creditors by devoting the property fairly to the payment of debts, and not with a view to the debtor's own advantage.

In Ohio, in the case of Hoffman v. Mackall, the language and object of the statute were commented on by Bartley, J., from whose opinion the following is an extract: "The effect of almost every assignment, even where creditors are to be paid pari passu, is, in one sense, to hinder and delay them in the collection of their debts, by withdrawing the property from the reach of any legal process to which they may wish to resort. This statute is to be construed according to its reasonable intent and object. And assignments, although designed manifestly to deprive particular creditors of speedy remedies at law, and thus hinder and delay them in the collection of their debts, or to deprive some of that full satisfaction of their debts, which by their superior diligence in prosecuting their suits, they would otherwise certainly have obtained, are upheld as valid and effectual. Although, in one sense, there is a manifest intent to hinder and delay one or more creditors, in such assignment, yet there is no intent to cheat or defraud them; and, by a reasonable construction, such hindrance and delay only as would operate as a fraud, and are designed as a fraud, come within the operation of the statute. When a man finds himself in failing circumstances, and unable to pay all his debts, he can do no act more just and equitable than to surrender and assign his property in trust for the benefit of all his creditors. In such

1 Gardner v. Commercial Nat. Bank, 95 Ill. 298.

25 Ohio St. 124, 133, 134.

situation all the law can reasonably demand is a faithful ap plication of all his property to the payment of all his debts; and when this object is accomplished by an assignment or deed of trust for the benefit of all his creditors, the hindrance and delay which may operate to the prejudice of particular creditors is simply an unavoidable incident to a just and lawful act. And such mere incident to such laudable act cannot be held to vitiate the transaction as fraudulent, until the maxim that equality is equity, in the distribution of the property of an insolvent, shall have been repudiated, and the highest act of justice which can be done by a debtor, in contemplation of insolvency, shall be deemed an act of dishonesty. If authority be necessary to sustain so plain a proposition, reference is made to Meux v. Howell, 4 East, 1; Wilder v. Winne, 6 Cow. 284, and 4 Wend. 100." In New York, it was held by the Court of Appeals, in Nicholson v. Leavitt1 (Gardiner, J.), that where the delay to creditors necessarily results from a fair exercise of the debtor's right to make an assignment with preferences, it is not prohibited by any statute.

§ 329. In the case of Nicholson v. Leavitt, in the Superior Court of the city of New York, the construction of the words of the statute now under consideration, was examined at great length by Duer, J., who delivered the opinion of the court. The following extracts from this opinion seem to claim a place under the present head. "It is not true, that where there is no evidence of a fraudulent intent, every assignment by an insolvent must be held to be void if the necessary effect of its provisions, or of any of them, is to hinder and delay the creditors, in the sense in which the words were understood by the counsel; for to assert this as the true construction of the statute, is to affirm that no valid assignment by an insolvent, of all his property in trust for

16 N. Y. 510, 516. The court in this case cite and approve Meux v. Howell and Wilder v. Winne; see also Bank of Silver Creek v. Talcott, 22 Barb. 550.

2

4 Sandf. S. C. 252, 284. The judgment in this case was reversed in the Court of Appeals, 6 N. Y. 510.

his creditors, has ever been made, or, so long as the statute shall remain in force, can be made. The necessary effect of every such general assignment, even where the creditors are to be paid pari passu, is to hinder and delay them in the collection of their debts, by withdrawing the property from the reach of any legal process to which they might wish to resort. Not only is such its necessary effect, but the actual intent of the debtor is to place the property beyond the immediate power and action of his creditors, by preventing them from obtaining any judgment by which it may be bound, or from issuing any execution or attachment under which it may be sold. He means to hinder the creditors from collecting their debts out of his property by any proceedings against himself as their debtor, and to delay them from receiving any portion of their debts until they shall become entitled to a dividend under the assignment; and the intent thus to hinder and delay them is not only to be plainly deduced from the nature of the trust, but not unfrequently is confessed in its terms. In fact, it was upon this very ground—the apparent and certain intent to hinder and delay the creditors-that originally the validity of a general assignment, although for the benefit of all the creditors without distinction, was not only seriously doubted, but seriously contested." The learned judge then refers to the case of Pickstock v. Lyster, already cited, and that of Braddock v. Watson, as having established the validity of such assignments, notwithstanding the objections made against them.

1

3 Price, 6. Of these decisions it is, however, said, "It seems impossible to deny that they are a plain violation of the statute of frauds, if we look merely to the words of the statute, and understand them in their literal extent." To show this, the learned judge quotes the words of the present New York statute (remarking that those of the English statute, and of the former acts of our legislature upon the subject, are substantially the same), that "every assignment made with the intent to hinder, delay, or defraud creditors, &c., shall be void "-dwells on the apparent departure from them involved in the doctrine now established (that, although the intent to deprive all or particular creditors of their lawful suits, and hinder or delay them in the recovery of their just demands, is confessed or proved, still the assignment, if by its terms all the property which it embraces must be applied ratably or otherwise to the payment of all the debts, must be sustained)— and then offers the following explanation of this seeming departure; that, although in these cases the intent to hinder and delay the creditors is manifest, it is just as certain that there was no intent to cheat or defraud them; and the reasonable con

§ 330. From the views expressed in the foregoing cases,1 the rule of construction seems deducible-that, in order to bring an assignment by a debtor within the statute of fraud ulent conveyances (at least in its original and unabridged form, and with reference to its professed title), on the ground of an intent to hinder and delay, there must be an intent to delay and hinder actually entertained by the debtor; and not only an actual intent, but a covinous or fraudulent one. But there is a class of cases which have established a very different rule of construction, constituting in some States the

struction of the statute is, that it is only such a hindrance or delay as was intended to operate, or if permitted could operate, as a fraud upon the creditors, that' was meant to be prohibited.

With deference to the opinion thus expressed, it may be observed that however applicable the explanation given may be to the present New York statute, and however necessary to reconcile with its language the decisions under it, it seems hardly called for in regard to the English cases remarked upon; nor do those cases, considered in the light of Meux v. Howell, and compared with the words of the English statute, appear to involve any violation of that statute. A marked distinction between the New York statute and those from which it was condensed by the legislature, is the entire absence of all the language so laboriously inserted in the earlier laws, and which served to define for the courts the quality of the intent contemplated. More will be said on this subject on another page.

'The rule as laid down in the text has been ratified and confirmed by several later decisions. In The State v. Benoist (37 Mo. 500), it was said (Holmes, J.), "An intent to defraud as well as to hinder and delay must appear in order to make it (the assignment) void." See also Gates v. Labeaume, 19 Mo 17; Potter v. McDowell, 31 Mo. 62.

But the words of the Missouri statute are 'hinder, delay or defraud;" and it was held in Crow v. Beardsley (68 Mo. 435), that either intent was sufficient to avoid the assignment. Hence an instruction to the jury that they should find for the defendant unless the conveyance was made to hinder, delay and defraud creditors, was erroneous.

The rule of State v. Benoist, seems to prevail also in Illinois. Myers v. Kinzie, 26 Ill. 30. So in the case of Bailey v. Mills (37 Tex. 434), it was said, "It is not a sound objection to an assignment that it operates to hinder and delay creditors, for this is the usual and almost invariable consequence of an assignment." The same opinion was expressed in Carlton v. Baldwin (22 Tex. 724). So in True v. Congdon (44 N. H. 48): "But if such assignment was made bona fide, and with no such fraudulent intent, it would be entirely immaterial what its effect might be. The effect of all assignments at common law or under our State statute, may be, and perhaps generally is, to delay and hinder creditors somewhat in the collection of their debts. And this effect might follow from an assignment made legally and bona fide as often as in any other case, but such effect can have no tendency to make the assignment void as against creditors." In Hefner v. Metcalf (1 Head, 578), the court say, "the words hinder and delay' are to be taken in their legal or technical, and not in their literal sense, or no deed could stand when creditors were not provided for." And see Shackelford, J., in Rindskoff v. Guggenheim, 3 Cold. (Tenn.) 284; and see Christopher v. Covington, 2 B. Mon. 357; Morgan v. Bogue, 7 Neb. 429.