Holberg v. Jaffray

Campbell, J.,

delivered the opinion of the court.

L. 1ST. Holberg & Bro. had the right to prefer creditors, and did it by consenting for judgments to be given against them, so as to create liens in favor of the several creditors on their goods, and thereby secure precedence of satisfaction to them out of the goods. In this there is nothing forbidden by law, and we find nothing in the mode of obtaining the judgments which the law condemns. The secrecy observed in reference to docketing the cases was. a precaution, merely, against publicity which would incite attachments and defeat the scheme of securing precedence to the creditors preferred, and was no more than characterizes the movements of failing debtors who make preferences by assignment or by sale of property.

We have failed to discover in the voluminous record any evidence of fraud or other state of case than the very common one of insolvent debtors anxious to prefer certain creditors, and doing it in the way proposed and conducted by counsel, and there is nothing in the fact that these counsel acted both for the creditors and the debtors. The question is, what was done, and not by whom it was effected. The evidence shows that the goods were sold for a fair price, much more, probably, than they would have brought under other circumstances; and we have no hesitation to say that had Jacob Holberg bought the goods at the price paid, at private sale, in payment of what was due him and others, and taken possession of them with*754out any judgment, he would have obtained an unassailable title to them on the facts presented by this record. The charge of the bill that there was a scheme to enable Jacob Holberg to acquire the stock of goods at a low price is unsustained. It does appear that counsel for attaching creditors were misled as to the money arising from sale of the goods being and remaining in the hands of the sheriff, but that made no difference in the rights of any party. The money was considered as in the sheriff’s hands. He was responsible for it, and if he paid it out wrongfully, or accepted as money the receipt of one not entitled to it, he could and would be dealt with as having it in his hands. i

The decree is manifestly wrong and is reversed, and the bill dismissed, and judgment here against complainants for costs in both courts.