Rump v. Van Rensselaer Realty Co.

Dowling, J.:

The plaintiffs have commenced this action to sequestrate the property of the defendant corporation. On February 2, 1910, there was' granted an order to show cause why a temporary receiver should not be appointed of the property of the defendant, which was served on February third and returnable on February fourth. On the morning of February fourth and before the argument of the motion the defendant made a general assignment for the benefit of its creditors, to its president, George H. Hicks. The court granted the order appointing a temporary receiver under date of February 10, 1910, and thereafter the said George H. Hicks, as general assignee of the defendant, moved in terms for a resettlement of the order appointing the receiver, but in fact, for a modification of said order, attaching to his moving papers a copy of the proposed order which in nowise interfered with the appointment of the temporary receiver ■ but added the following clause: This order shall in no way enjoin or restrain the said George H. Hicks as general assignee of the defendant1 from collecting and receiving and obtaining the assets and property of said corporation assigned to him by virtue of said assignment nor from taking such action or proceedings and doing such things as may be necessary and .proper to carry out the purposes of said assignment.” The court refused to so modify its order and from such denial this'appeal is taken. It seems clear that the assignee was entitled to the granting of this modification. In its presént form, the order appointing the temporary receiver, in effect, practically ousts the assignee of his control of the funds of the assigned estate. -

He has qualified as assignee and until the assignment is set aside or, in an action brought for that purpose, the court stays his control *291over its funds or substitutes some one for him, his right to the custody of the assets of the assigned estate is complete. It is not possible in such a summary way and simply by motion, in effect, to set aside a general assignment for the benefit of creditors.

The order appealed from must, therefore, be reversed, with ten dollars costs and disbursements, and the application to modify the order granted, with ten dollars costs.

Ingraham, P. J., McLaughlin, Clarke and Scott, JJ., concurred.

Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.