tors or administrators, shall be insufficient to pay al. the debts from the deceased, the debt due the United States shall be first satisfied; and the priority thereby established, shall be deemed to extend as well to cases in which a debtor, not having sufficient property to pay all his debts, shall make a voluntary assignment thereof, or in which the estate and effects of an absconding, concealed or absent debtor, shall be attached by process of law, as to cases in which an act of legal bankruptcy shall be committed. 2. What general rules have the supreme court declared upon the construction of this statute? 1. That no lien is created by the statute. 2. The priority established can never attach while the debtor continues the owner, and in possession of the property, although he may be unable to pay his debts. 3. No evidence can be received of the insolvency of the debtor, until he has been divested of his property in one of the modes stated in the section. 4. Whenever he is thus divested of his property, the person who becomes invested with the title is thereby made a trustee for the U. States, and is bound to pay the debt first, out of the proceeds of the debtor's property.-Beaston v. The Bank of the United States, 12 Peters' S. C. Rep., 102. But few cases have been presented to the consideration of the courts of the United States, upon this subject. They are: 1. Fisher v. Blight, 2 Cranch, 358, which decides two points. That the priority extends to debtors generally, under the above act. That it is not in the nature of a lien on the property. 1st. 2d. 1st. 2. The United States v. Hooe, 3 Cranch, 73, which decides: That priority is not a lien-a principle always to be recollected. 2d. That to create a case, where in case of insolvency the priority can attach, there must be an assignment of all the property of the debtor. 3. Prince v. Bartlett, 8 Cranch, 431, which decides that the insolvency is not a mere inability to pay, but must be some notorious act. 4. The United States v. Bryan & Woodcock, 9 Cranch, 377, which only says, the priority, given by the act, does not apply to debts due before the passing of the law. 5. Thelluson v. Smith, 2 Wheaton, 396. In this case the question was, whether a prior lien by judgment divested the priority of the United States. And the court, after reciting the act, says, "these terms are as general as any that could be used, and exclude all debts due to individuals, whatever may be their dignity. The assignees are made personally responsible to the United States, if in case of insolvency they pay any debt previous to those due to the United States. The law makes no exception in favor of prior judgment creditors; and no reason has been, or we think, can be shown, to warrant this court in making one " 6. The United States v. Huland & Allen, 4 Wheaton, 108, only asserts the principle of former cases. 7. Conard v. The Atlantic Insurance Co., 1 Peters' S. C. Rep., 386. (This is now the leading decision on the subject, The case was argued by Mr. Ingersoll and Mr. Wirt for the plaintiff in error, and Mr. Binney and Mr. Webster for the defendants, and the opinion of the court pronounced by Mr. Justice Story, after a review of all the preceding cases.) The question was, whether the priority of the United States, upon an insolvent estate, would have the effect to divest the lien acquired by a lender upon respondentia, entered into after the borrower had become largely indebted to the United States, but before any notorious or legal act of insolvency committed. And it was decided, that the priority of the United States will not divest a specific lien, attached to anything, whether it be accompanied with possession or not. The priority, as limited and established in favor of the United States, is not a right which supersedes and overrules the assignment of the debtor, as to the property which the United States may afterwards elect to take in execution, so as to prevent its passing, by virtue of such assignment, to the assignees; but it is a mere priority of payment, out of the general funds of the debtor in the hands of the assignees; and the assignees are rendered personally liable if they omit to discharge the debt of the United States. Mere inability of the debtor to pay his debts, is not an insolvency within the statute, but it must be manifested in one of the three modes pointed out in the explanatory clause of the section: consequently the respondentia lien prevailed. 8. Harris v. Dennie, 3 Peters' S. C. Rep., 292. In this case it was decided that the United States have no general lien on merchandise, the property of the importer, for duties due by him on former importations. The only effect of the first provision in the sixty-second section of the Act of 1799, ch. 128, is, that the delinquent debtor is denied at the custom-house further credit for duties, until his unsatisfied bonds are paid. He is compellable to pay the duties in cash, and upon such payment he is entitled to the delivery of the goods imported. 9. Harris v. D'Wolf, 4 Peters' S. C. Rep., 147. The case of Conard v. Atlantic Ins. Co., 1 Peters' S. C. Rep., 386, taken notice of and affirmed. 10. Conard v. Nicholl, 4 Peters' S. C. Rep., 291. The principles decided in the case of Conard v. The Atlantic Ins. Co., again reviewed and confirmed. 11. Hunter v. The United States, 5 Peters' S. C. Rep., 172. Decided, that the same right of priority, which belongs to the government, attaches to the claim of an individual, who, as surety, has paid money to the gov ernment. 12. United States v. The State Bank of North Carolina, 6 Peters' S. C. Rep., 29. Decided that the priority of the United States extends, as well to debts by bonds for duties which are payable after the insolvency or decease of the obligor, as to those actually due at the period thereof. 13. United States v. Hack et al., 8 Peters' S. C. Rep., 271, where it was held that the priority of the United States does not extend so as to take the property of a partner from partnership effects, to pay a separate debt, due by such partner to the United States, when the partnership effects are not sufficient to satisfy the partnership debts. 14. Field et al. v. The United States, 9 Peters' S. C. Rep., 382. In this case the United States obtained judgments in suits, instituted on bonds for the payment of duties, in the district court for the district of Louisiana. Before the judgments, the debtor of the United States had become insolvent, and his property, under the insolvent laws of Louisiana, had passed into the hands of syndics for distribution among his creditors, according to their respective priorities, and the syndics sold the property, part for cash and part on credits of one, two and three years. The whole proceeds exceeded $40,000. There were several mortgages upon different houses, lots, &c., to the amount of $27,000, and when all the notes taken by the syndics were paid, there would be sufficient to discharge these mortgages, and all the debts due to the United States. A large amount of the proceeds was not to be received by the syndics until after this suit was commenced against them, and judgment obtained in favor of the United States. One moiety, being one moiety of the amount of sales, being payable after the suit was commenced against the syndics, and the other after judgment was rendered against them. The court held that the syndics were not liable to the United States for the debts due to them, unless funds had actually come to their hands. As one moiety of the notes was not paid at the time, judgment was rendered against them: it does not judicially appear that they had funds upon which the United States were entitled to judgment. If the remaining moiety has since been paid, the United States will then have a legal claim thereon for their debts. 15. Brent et al. v. The Bank of Washington, 10 Peters' S. C. Rep., 596. In this case the priority of the United States was held not to extend so as to affect the power of an incorporated bank, on the stock held by one indebted to the bank, when, by the charter of the bank, it is provided that no transfer of the stock of any one indebted to the bank shall be made, before the debt due by the stockholder of the bank shall be paid. 16. Beaston v. Farmers' Bank of Delaware, 12 Peters' S. C. Rep., 102, decided that corporations are persons within the Act of 1797, and the priority of the United States exists as to debts due by them to the United States. All debtors to the United States, whatever their character, and by whatever mode bound, may be fairly included within the language of the fifth section of the Act of Congress. And it is manifest that Congress intended to give priority of payment to the United States, over all other creditors, in the cases therein stated. It therefore lies upon those who claim exemption from the operation of the statute, to show that they are not within its provisions. The priority of the United States does not extend to the real estate, or the proceeds of the real estate belonging to or vested in the heir.Watkins v. Otis, 2 Pick. Rep., 102. The priority does not attach as against the heir. but only when the real estate, or the proceeds thereof, passes to or is vested by law in the hands of an assignee of an insolvent, or his executors or administrators. -United States v. Crookshank, 1 Edw. Ch. Rep., 233. 3. What is the general rule of nations upon the right of priority of payment? It is believed that most governments of modern times have reserved to themselves the right of a fiscal lien. The government was a privileged creditor under the Roman law, and entitled to a priority of payment of debts. The cessio bonorum was made subject to this priority. This is generally the case in all modern insolvent and bankrupt laws. In England, the King's claim is preferred before that of the subject, provided the King's process was commenced before the subject had obtained judgment. -Stat. Hen. VIII., ch. 39. Quando jus Domini Regis et subditi insimul concurrunt, jus regis præferri debet.-Quick's Case, 9 Coke, fol. 129 The priority of the different states of the Union rests entirely upon statute; and the common law gives no preference over other creditors. -The State v. Harris, 2 Bailey's S. C. Rep., 598. 1 Kent's Com. 247 OF JUDICIAL LIEN. 1. What right is conferred by general lien, by judgment? It is not understood that a general lien, by judgment, constitutes, per se, a property or right in the land itself; it only confers a right to levy on the same, to the exclusion of other adverse interests subsequent to the judg ment; and when the levy is actually made on the same, the title of the creditor relates back to the time of the judgment, so as to cut out intermediate incumbrancers. But subject to this, the debtor has full power to sell his land.-Conard v. The Atlantic Insurance Co., 1 Peters' S. C. Rep., 443. Where a creditor has obtained a lien upon real estate, by judgment at law, if he subsequently bring an action of debt upon that judgment and recovers a new judgment, he will lose his first lien.-Purdy v. Doyle, 1 Paige's Rep., 558. There is no lien on personal estate, as to third persons, until a fier facias has been delivered to the sheriff-Jones v. Jones, 1 Bland Rep., 448. Taking the body in execution is a discharge of the judgment, except where otherwise provided by statute, and an imprisonment of the person must be a suspension of the lien. The defendant would have a right to sell his property, either real or personal, and the execution allowed by the statute to be taken out after the discharge against his property, cannot claim priority to any lien created or right acquired by others during the imprisonment of the defendant.-Jackson v. Benedict, 13 Johns. Rep., 553. LIEN BY EXPRESS CONTRACT AND BY 1. What is the general rule as to the lien of an attorney? It is a general principle, that an attorney has a lien for his services and expenses, on the papers and the securities in his hands, of which he may avail himself in an action of trover; and that he is answerable to him in account, only for the balance of the avails when collected. The lien of an attorney upon a judgment which has been recovered by his industry, and at his expense, for his fees and advances, is founded on strong equity and justice, and recognized very generally, wherever the common law is known.-Shapley v. Bellows, 4 N. H. Rep., 347. Martin v. Hawks, 15 Johns. Rep., 405. Barker v. Cook, 11 Mass. Rep., 236. Dunklee v. Locke, 13 Mass. Rep., 525. Grant v. Hazeltine, 2 N. H. Rep., 541. Read v. Dupper, 6 Term Rep., 361. Randall v. Fuller, Ibid, 456. 2. How are liens divided? Into general and special liens. 3. What is a general lien? It is the right to retain the property of another for a general balance of accounts. This species of lien is strictly taken.-2 Kent's Com., 634. Green v. Farmer, 4 Burr, 2221. And it requires strong evidence of a settled and uniform usage, or of a particular mode of dealing between the parties, to establish it.-Bushforth v. Hadfield, 6 East's Rep., 519. 7 East's Rep., 224. Bleaden v. Hancock, 4 Car. & Payne's Rep., 152. 2 Kent's Com., 636. An agreement entered into by a number of dyers, &c., at a public meeting, that they would not receive any more goods to be dyed, &c., but on condition that they should respectively have a lien on those goods for their general balance, is good in law; and any one, who after notice of it, delivers goods to either of those persons, must be taken to have assented to those terms. Kirkman et al. v. Shawcross, 6 Term Rep., 14. For special lien, see Agent, tit. Lien. 4. What is the rule of the common law as to the lien of the vendor upon lands sold? The rule is, that both the vendor and the vendee have mutual liens ; the former for the purchase money due, and the latter for what he has paid, in case it is to be restored to him.-Farmer v. Samuel, 4 Litt., 190. Newman v. Machin, 5 Hayd. Rep., 241. M'Campbell v. M'Campbell, 5 Litt. Rep., 94. Brown v. East, 5 Mon. Rep., 408. Frink v. M'cKeon, 4 J. J. Marsh. Rep., 169. The vendor has a lien on the estate sold, so long as it remains in the hands of the vendee, unless the circumstances of the case show that such lien was not intended to be reserved.-Stafford v. Van Rensselaer, 9 Cowen's Rep., 316. Gilman v. Brown, 1 Mason's Rep., 212. By the civil law, the French law, and the law of Louisiana, the vendor of personal property has this privilege, and it is not destroyed by taking a promissory note, bond, or other acknowledgment from the buyer.-Domat, b, tit. 5, sec. 2. Duranton, des Priv. et des Hypoth., Liv. 3, tit. 18, sec. Vo. 119 127. Thayer v. Goodall, 4 Lou. Rep., 222. Terry v. Terry |