PHILLIPS & BUTTORFF MFG. CO. v. WHITNEY, 102 F. 838

PARDEE, 'Circuit Judge. As this case is presented for our review, it seems clear that the Phillips & Buttorff Company, defendant helow and plaintiff in error here, really and substantially owes to the estate of F. H. Whitney the full' amount of the principal and interest of the notes sued on, and against them, when sued on by the proper plaintiff, said company has no defense, legal or equitable, and that the plaintiff helow (defendant in error here) is the legal and beneficiary owner and holder of the notes in question, either as the assignee of Eranklin H.

Whitney, under an assignment for the benefit of creditors executed by Franklin H. Whitney in his lifetime, or as executor of the last will and testament of Franklin H. Whitney, duly executed and probated. The defense in the court helow, so far as it had any merit, was on the line of defect in plaintiff’s title as assignee of Franklin H. Whitney, and to that question were directed most of the demurrers, pleas, objections to evidence, and requested charges to the jury, with which the record abounds.

On that question nearly all of the 90 assignments of error and the bulk of the very able and ingenious. briefs .of counsel in this court are based; and it seems clear that if that question is ruled, as we think it should he, in favor ■of the defendant in error, there can he no good reason for considering other rulings of the trial court, which, even if erroneous, were not really injurious to the plaintiff in error, provided the plaintiff "below was the legal owner and holder of the notes sued on. The undisputed facts are that on or about the 29th day of September, 18ÍK5, the said .Franklin 11.

Whitney and Ella Whitney, his wife, conveyed to said .James 15. Bruff, as trustee, by certain trust deeds, all their real estate then owned by said Franklin II. Whitney, without preference to any creditors, and further in trust: for the payment of the debts of the Bank of Atlantic, said real estate being certain lands in Colorado and Missouri and in the state of Alabama, all the real estate owned by said Franklin II. Whitney in the county of Jefferson, state of Alabama, and all the rights and interest of every description whatsoever of the said Franklin II.

Whitney in said real estate; that at or about the time of making said trust deeds the said Franklin II. Whitney made an assignment, purporting to be a general assignment of all his property'located in the state of Iowa, to said James B.

Bruff, in trust for the payment of his debts and the debts of the Bank of Atlantic; that Bruff accepted the trust and qualified as as-signee; that as such he acquired possession of the lease and notea now sued on, as part of said personal property, and thereafter brought iliis suit; that later still lie regularly settled his trust in the district court of Cass county, Iowa, resigned, and was discharged; that thereupon said court appointee! James (⅜.

Whitney, the plaintiff, trustee in the assignment; that he accepted and qualified as such, and Bruff was ordered to convey and deliver all the trust estate to him, and in conformity he transferred the notes by indorsement, and the lease by such delivery as was practicable, to James Gf. Whitney, whereby there was vested in Whitney all the title that had been in the assignor, Whitney, and in his original assignee, Bruff.

And when it is considered that under the laws of the state of Iowa, where Whitney, the assignor, and Bruff, his assignee, had their domiciles, which law controls in the premises as to personalty, the said general assignment made by F. IT.

Whitney on September 29, 189(5, was authorized and valid; that it devested out of said Whitney, and invested in his as-signee, Bruff, “the title to any property belonging to the assignor tWhitney] at the time of making the assignment” (McClain’s Code Towa, gg .‘5292-15294 [2115-2117']); that said assignee, Bruff, thereby became vested, when duly qualified, with as “full power and authority to dispose of all the estate, real and personal, assigned, as the debtor had at. the time of the assignment, and to sue for and recover in the name of such assignee everything belonging or appertaining to said estate, and generally do whatever the debtor might have done in the premises” with one exception, affecting only the sale of real properly fid. § 830(5 [2127]); that: the district court of Iowa for Cass county, in that state, is a superior court of record, of general jurisdiction both at law and in equity, with full jurisdiction'of the trusts of said assignment from Whitney to Bruff; (hat having acquired jurisdiction. in fact, of such trust estate and trustee, said district court was fully empowered and authorized, in all cases shown to it to be proper, to remove such trustee, or. if he died, resigned, or failed to exorcise the trust as by law required, to appoint a successor, who, when qualified under its orders, is declared by law to “possess all the powers conferred upon such assignee, and shall be subject to all the duties hereby imposed as fully as though named in the assignment” (Id. § 3807 [2128]), — we fed bound to hold that the plaintiff below acquired a title good in every respect until impeached by fraud or mistake.

The plaintiff in error contends that no title whatever passed from Franklin EL Whitney to James B. Bruff, the assignee, under the deed of assignment executed on September 29, 1896, because, while the same purports to be a general assignment, wherein the said Franklin EL Whitney sells, transfers, and conveys to James B. Bruff “all of my property, both real and personal, except such as is exempt from execution, wherever situated, in the state of Iowa, and my personal property, wheresoever situated;

Schedule A, hereto attached, being a list of my personal property assets, and

Schedule B, hereto attached, being a list of my real estate hereby conveyéd. And, in case any real or personal property subject to execution in .the state of Iowa is not included in the above list, I hereby convey the same as fully as though the same were mentioned therein,” — it was in fact only a partial conveyance,- and the personal property conveyed was only that enumerated in

Schedule A, as follows: “Personal Property of Franklin H. Whitney. Forty-seven shares of the Atlantic Water Company; one large fire-proof safe, containing burglar-proof chest, now in Whitney Building, Kansas City, Missouri; one fire-proof safe, now used by Bank of Atlantic; one Diebold burglar-proof safe, now used by Bank of Atlantic,” — and, on this construction, claims that the case is in all respects identical with, and should be controlled by, Bock v. Perkins, 139 U. S. 628, 11 Sup. Ct. 677, 35 L. Ed. 314. Bock v.

Perkins was a contest between a creditor and an assignee, in which it was claimed by the creditor that, while the deed of assignment purported to be a general assignment, _ the same was intended to be, and in fact was, only a special assignment, and, in addition, claimed it was void because it contained unlawful preferences. The supreme court held, as a matter of law, that, as to the property actually assigned, the

schedule referred to in the assignment as more particularly describing the property conveyed controlled, and, as a matter of fact, that the assignment was not intended to be, and was not, a general assignment, and, from this fact, further held that the statute of the state of Iowa which provides that a general assignment for the security of creditors shall vest in the assignee the title to all of the properly belonging to the debtor at the time of making the assignment, whether included in the inventory or not, was not applicable; quoting Van Patten v. Burr, 52 Iowa, 518, 3 N.

W. 524, for the proposition, “The transaction contemplated in the Iowa statute, and termed a general assignment,” is a disposition of all the property of the insolvent for the benefit of all his creditors. We distinguish the present case from Bock v.

Perkins, supra, because the assignment made by Whitney to Bruff not only purported to be a general assignment, but was in fact intended to be a general assignment, which, with trust deeds of the same date to the same assignee, would convey all his property, except that exempt from execution under the laws of Iowa, for the equal benefit of all his creditors; and this purpose and intent was evidenced, not only by the document itself, but by the circumstances surrounding and attending the transaction. The same day the general assignment was executed said Franklin H.

Whitney executed and delivered to the same assignee trust deeds conveying all of his real estate, charged with the same trust, situated outside of the state of Iowa, including the real estate in Alabama, the lease of which was the original cause of the present suit; and these trust deeds were evidently made outside of the purported general assignment, to insure the conveyance of the real estate according to the laws of the state where situated.

The possession of the Alabama property and the notes given thereunder, evidently in accordance with the purport and intent of the assignor, passed into the hands and control of the as-signee. Under these circumstances, we have no doubt, as a matter of fact, that the assignment in question was intended to be and was an assignment of all the property of the assignor, wheresoever situated, for the benefit of all his creditors; and, if it was such an assignment, the omission from the

schedule of the lease of the real estate in Alabama and the notes given thereunder was not important, and, in accordance with the laws of Iowa, the assignor’s domicile, the lease and notes passed to the assignee with as full title as if they had been expressly mentioned in the schedule. We are not permitted to doubt that the proceedings in the Iowa court in the matter of the assignment of Franklin IF. Whitney were in all respects regular and conclusive as to the resignation of Brnff as assignee, and the appointment and qualification of James G-.

Whitney as assignee in Bruff’s place, nor that the order of the court and the conveyance thereunder by Brnff to James Q-. Whitney operated a full and complete transfer of the legal title and ownership of the lease and notes herein sued on to the present plaintiff in the court a qua. The judgment of the circuit court is affirmed.