Glenn v. Boston & Sandwich Glass Co. , 7 Md. 287 ( 1854 )

Mason, J.,

delivered the opinion of this court.

The Court of Appeals, by two previous decisions, (6 Gill, 404, and 2 Md. Rep., 1,) have decided, that there was no partnership existing between Kerr and Potter, that the property claimed as partnership property belonged to Kerr individually, and that Potter had no right to the relief for which he prayed in the court of chancery, namely, for the appointment of a receiver, an injunction, &c.; and the case in 2 Md. Rep. further decided, that the fund in the hands of the receiver previously appointed should be transferred to the trustee of Kerr, who, pending the chancery proceeding, had applied for the benefit of the insolvent laws.

The plaintiffs in the present action, who are a foreign corporation, were judgment creditors of Kerr, and upon their judgment issued an attachment, and had the same laid in the hands of Kerr’s trustee, Mr. Glenn, before the funds had been actually received by him from the receiver, and the question to be determined on this appeal is, whether the attachment under such circumstances can be sustained?

The cases of Larrabee vs. Talbott, 5 Gill, 435; Evans & Co., vs. Sprigg, 2 Md. Rep., 457, and Duck vs. Poe, 5 Md. Rep., 1, have settled, that the conveyance of property under our insolvent laws constitutes no impediment to the pursuit of such property for the payment of debts by foreign creditors; in other words, that the discharge of the defendant under the insolvent laws of this State did not impair the right of nonresident judgment creditors to obtain, by attachment or execution on their judgments, a preference over domestic creditors. The defendant seeks, however, to except this case from the operation of this general principle, upon several grounds, none of which do we regard as tenable.

The only two plausible grounds of objection to this proceeding are, first, that at the time the attachment was laid in the-hands of the trustee,, he had not received in his actual possession any of the funds of the insolvent;, and secondly, in thus-admitting the right of the trustee to claim the fund by virtue of the insolvent laws, these creditors have so far recognised those laws as to be bound by them.

As we have said, it has been decided that the court of chancery had no jurisdiction over this ease as a partnership transaction, because, in fact, no partnership existed between Kerr and Potter, and that the property being Kerr’s, it passed to his trustee by virtue of his application for the benefit of the insolvent laws. This being the case, in contemplation of law, the-moment Kerr petitioned the right to his property vested in his-trustee, and he became the legal custodiar of it from- that moment. In his hands, as the party legally entitled to the-possession and the control of the property, the attachment was-properly laid. Actual possession of money or property on the part of the garnishee is not necessary to make an attachment efficacious or operative, provided he has the legal right to tire posséssion and control, as in the cases of money deposited in bank and the like. Although the effects of Kerr were, in fact, in the hands of a receiver appointed in chancery, still they were improperly there, and were held in violation of the rights of the trustee in insolvency, (2 Md. Rep., 1,) and for all practical purposes, the trustee may be treated as the legal possessor of all the property held by Kerr at the time of his application.

Besides, it has been the general practice under our attachment system, under the authority of the 5th and 6th sections of the act of 1795, ch. 56, to condemn all credits or property in the hands of the garnishee of the debtor at the time of the trial. In the present case,- at the time of the rendition of the judgment of condemnation, it is not denied that the funds belonging to the estate of Kerr had been reduced into the actual possession of the trustee, the present garnishee, Mr. Glenn.

This leads us to the second objection, to which we have already referred, namely, whether the plaintiffs, in recognising the right of the trustee to the possession of Kerr’s property, by laying their attachment in his hands before he had actually received the money, have so far assented to the insolvent proceedings as thereby to become bound by it. Knowledge is one thing and assent another, and it by n-o means follows, that because a party acts with reference to a knowledge of a particular act, that he thereby assents or acquiesces in that act. Therefore, while it was perfectly legitimate for the plaintiffs to proceed upon the knowledge of the legal effect and operation of our insolvent system upon Kerr’s property, we cannot legitimately infer from that knowledge, or from the acts done in pursuance of it, that they assented to or agreed to be bound by the laws themselves.

It seems to us that all the points involved in the present record have been fully settled by previous adjudications in Maryland, and in-confirmation of the ruling of the court below. We must,-therefore, affirm the judgment.

Judgment affirmed.