This action was brought to recover the value of a quantity of goods alleged to have been wrongfully and unlawfully taken from the plaintiffs by the defendants. The defendants justified under an attachment. It appears that on the 27th day of October, 1882, one Simeon N. Wetmore, of Garfield, Pa., was indebted to the plaintiffs in the sum of $957.86, for which amount he confessed judgment; that on the same day he executed and delivered to the plaintiffs a bill of sale of all the goods and chattels of any kind and nature, including fixtures, in his store at Garfield, in the' State of Pennsylvania, being his entire stock of goods and groceries in the store building, together with the store fixtures, in consideration. of the sum of $1,000; that thereupon, and on the same day, the plaintiffs executed and delivered back to Wetmore a paper in which they agree, in consideration of the bill of sale made to them, that after their debt of $957.86 is paid out of the property mentioned m the bill of sale, and their expenses made in the. matter, that they will pay the balance left from the sale of the goods to Wetmore, or any person to whom he may direct payment.
It further appears that W. G. Elyea, one of the plaintiffs’ firm, immediately went to Garfield, packed up the goods in boxes, and shipped them to one L. B. Elyea, a minor son of W. G. Elyea, at Salamanca, N. Y.; that before Elyea succeeded in getting the goods out of the State of Pennsylvania they were attached at Clarendon, and he paid seventy-three dollars and fifteen cents to get them released ; that on their arrival at Salamanca, N. Y., they were placed in a store, and were then again attached by the defendant Kibbe in this action, as a creditor of Wetmore, and the goods were removed from the possession of the plaintiffs.
It is now contended that this bill of sale is in violation of the statute and consequently is fraudulent and void as against creditors. The statute provides that “ All deeds of gift, all conveyances, and all transfers or assignments, verbal or written, of goods, chattels or things in action, made in trust for the use of the person making the same, shall be void as against the creditors, existing or subsequent of such person.” (2 E. S., 135, § 1.)
In the case of Dunham v. Whitehead (21 N. Y., 131), it was held that an assignment by a debtor to a creditor, of all his personal property and choses in action, for the payment of a debt with the provision for the return of the surplus, is, in- effect a mortgage, and is not void under the statute of trusts, as for the use of the person making it. That a distinction exists between a trust where the whole title vests in the trustee, and the transfer under which the debtor retains a residuary interest which remains subject to the action of creditors.
In the case of Van Buskirk v. Warren (2 Keyes, 119; S. C., 4 Abb. App. Dec., 457), it was held that an assignment made directly to certain creditors, for the purpose of securing their par
In McClelland v. Remsen (36 Barb., 622), the ease, so far as this question is concerned, is on all fours with the one under consideration. It was held that an assignment to a creditor, to pay his particular debt, reserving the surplus to the debtor, was not void under the statute. Brown, J., in delivering the opinion of the court, clearly points out the distinction between such an assignment and one made by a debtor to a trustee, upon trust, for the payment of particular and specific debts, reserving the surplus, etc. In the one case a trust was created for the benefit of others, in which the whole title passed to the assignee; in the other, it was in the nature of a chattel mortgage, merely securing the payment of the debt of the creditor, to whom the transfer-was made. This ■case was affirmed in the Court of Appeals (5 Abb. [N. S.], 250).
In the case of Smith v. Beattie (31 N. Y., 542), it was held that a bill of sale, absolute upon its face, transferring property to be held as security for the payment of a debt due the vendee, is, in character and effect, a mortgage, and is to be treated as such. In .such case the mortgagee acquires only a lien upon the assigned property. The residuary interest of the mortgagor therein may still be reached by his creditors. (See, also, Knapp v. McGowan, 96 N. Y., 75-86.)
It would thus appear that the bill of sale in question was not •fraudulent upon its face, but, on the contrary, was a good and valid instrument, creating a lien in favor of the plaintiffs to the extent of their claim; that whilst the defendants had the right to follow the .■surplus, they did not have the right to take from the plaintiff that which was necessary to satisfy their judgment.
It follows that the order should be reversed ana a new trial granted, costs to abide event.
■Order reversed, new trial granted, costs to abide event.