Lane v. Wheelwright , 69 Hun 180 ( 1893 )

VAN BRUNT, P. J.

This action was brought by the sheriff and attaching and judgment creditors in aid of the attachments set forth in the complaint, and the judgments and execution issued thereon to enforce liens claimed 1;o have been created by said attachments, and to remove obstructions to the collection of the judgments out of the attached property. We think, for the reasons stated in the opinion of the learned judge who tried the case in the court below, that the attachments were properly levied, and that the objections to the form of the complaint were waived by not being taken by demurrer or answer. And the only question in respect to which a satisfactory conclusion was not reached was the question as to whether, at the time of the levying of the attachments, the property in question was the property of the debtor in the attachment suits. The learned judge held that the attempted transfer of the property was void because prohibited by the laws of this state, and that in the absence of proof to the contrary the laws of Massachusetts are presumed to be the same as the laws of this state; the prohibition contained in the laws of this state being against the transfer by a corporation of any portion of its property to give a preference to any of its creditors in contemplation of insolvency. Therefore, the only questions necessary for us to discuss are: Was there a transfer by the Norton Manufacturing Company, the defendant in the attachment suits, to Eddy & Street, of this property subsequently attached? And was such transfer void because contrary to the statutes of this state?

It appears from the evidence in this case that Mr. Eddy, of Eddy & Street, was the president and treasurer of the Norton Manufacturing Company, the defendant in the attachment suits,—a Massachusetts corporation,—and that the property which formed the subject-matter of the attachment was situated within this state, having been consigned to the firm of Wheelwright, Eldridge & Co., defendants herein, for sale, upon which said firm had made advances; the amount of goods being more than sufficient to pay such advances. And it further appears that the Norton Manufacturing Company being largely indebted to Eddy & Street, in July, 1888, a resolution was passed by the directors of said company, authorizing Mr. Eddy to protect Eddy & Street against any goods that were sold them in the future, and that subsequent thereto, and prior to the 19th of September, 1888, Eddy & Street had sold the Norton Manufacturing Company goods amounting to somewhere near $5,000, and that the Norton Manufacturing Company had consigned the goods in question, as above stated, to Wheelwright, Eldridge & Co., upon which day Mr. Eddy, under the power given him in contemplation of the insolvency of the Norton Manufacturing Company, transferred all the goods in the hands of Wheelwright, Eldridge & Co. to Eddy & Street, and Wheelwright, Eldridge & Co. were notified thereof. Such transfer took place on the 19th of September, 1888, and Eldridge was present with Mr. Eddy. No money passed at the time, nor was there any change in the possession of the goods. The transfer was effected by such goods being charged on the books of the Norton Manufacturing Company to Eddy & Street, and credited on Eddy & Street’s books to the Norton Manufacturing Company, and the charge to Wheelwright, Eldridge & Co. of these goods by the Norton Manufacturing Company was canceled. These entries were made by Mr, Eddy personally, no one having any authority to act but himself. It would seem that the result of those transactions was to change the title in these goods from the Norton Manufacturing Company to Eddy & Street, and that all was done which could be done to effect such transfer. The goods in question were in the possession of Wheelwright, Eldridge & Co. Neither the Norton Manufacturing Company nor Eddy & Street were entitled to the possession of the same, they being the subject of a pledge for advances made by Wheelwright, Eldridge & Co. Such being the case, unless the laws of New York, prohibiting the transfer by a corporation of any portion of its assets to give preference to a creditor in anticipation of insolvency, applied to this transfer, the title to the goods in question were in Eddy & Street. It seems to us clear that such laws do not apply to a foreign corporation. These prohibitions being statutory, and not existing under the common law, there is no presumption that the law of Massachusetts was the same as the law of New York; the only presumption being, where the foreign law is not proven, that the common law still exists in those countries where the common law obtained. Applying this rule to the case at bar, there was no prohibition against the Norton Manufacturing Company transferring these goods to Eddy & Street; and, in the absence of fraud, such transfer was effectual to vest the title in Eddy & Street. The judgment appealed from should be reversed, and a new trial ordered, with costs to appellants to abide event. All concur.