726 CHAP. XVIII. OF SUITS AT LAW AND IN EQUITY BY AND AGAINSt the ASSIGNEES. SECT. 1. Of Suits in Equity. 2. Of Actions at Law; and herein of Proceedings against the Sheriff. 3. Effect of the Bankruptcy upon Suits previously commenced by the Bankrupt. SECTION I. Of Suits in Equity. It is not the purpose of this chapter to consider every case, in which the assignees may have a right of action, or suit, against persons in possession of the bankrupt's property; that inquiry, as it is conceived, more properly appertaining to the division of a former chapter (1), in which all the various species of property passing to the assignees by virtue of the assignment, and the different circumstances under which they can claim it, have been already fully considered. The object we have now in view is, therefore, to treat more particularly of the forms and proceedings which the assignees must adopt in the exercise of their right, in order to recover the different kinds of property which the bankrupt was previously entitled to; - or which he would have been entitled to, if he had not become bankrupt. The whole of the bankrupt's estate being vested in the assignees by the assignment as fully as it was in the bankrupt himself, they have the same remedies to recover it either by (1) Chapter XI. suit or action (1)—with this exception, however, that they commenc ed without consent of creditors; are by the 88th section restrained from commencing suits in Cannot be equity without the consent of the major part in value of the creditors (who have proved under the commission) present at some meeting, of the purport whereof twenty-one days' notice shall have been given in the London Gazette; or if one third in value of such creditors shall not attend at such meeting, then the assignees must procure the consent in writing of the commissioners. And the same previous consent, we have before seen (2), is necessary to enable them to compound any debt, or to submit any dispute to arbitration. but they cannot give assignees a general Creditors cannot give the assignees a general power to prosecute suits, or submit matters to arbitration at their own discretion; but there must be a meeting of creditors as directed by the statute, to consider of each particular suit, or case for arbitration. (3) But when the meeting is pro- Majority perly advertised, the majority in value of the creditors pre- present sent have a right to bind those who are absent. (4) If the assignees, without the consent of the creditors regularly obtained in the manner before mentioned, take upon themselves to file a bill against any person, the defendant may plead that the suit was not instituted with the consent of the creditors at a meeting pursuant to the requisitions of the statute. (5) power. binding. When as signees sue without consent. ditors refuse to Where the majority in value of the creditors refuse When creto permit the assignees to institute a suit in equity, it has been held, that any creditor may in that case bring one, assent. but at the peril of costs. (6) Thus, where the majority of creditors had dissented from bringing a suit to redeem a lease, and the other creditors filed a bill against the mortgagee and the assignees for that purpose,-redemption was (1) Bl. Com. 485. Hussey v. Fiddall, 6 Mod. 324. 3 Salk. 59. (2) Ante, 323. 90. (3) Ex parte Whitchurch, 1 Atk. (4) Cooper v. Pepys, 1 Atk. 106. (5) Ocklestone v. Benson, 2 Sim. & S. 265. (6) Franklyn v. Fenn, Barnard. Rep. 30. When consent not requisite. All the assignees need not sue. Bankrupt need not be made a party to the suit. accordingly decreed (1); and it was said, that this was like the case of an executor, who being the proper party to get in the estate, the Court will not in general suffer the creditors of the testator to file a bill in equity to get it in; but that if collusion is charged, it is otherwise. (2) If the interests, however, of the creditors are not affected - as if the object of the suit by the assignees is to enforce a mere personal claim of indemnity, then the consent of the creditors will not be necessary to the institution of the suit. Nor need all the assignees be plaintiffs; for if any refuse to join in the suit, they may be made defendants (3); and the others would not be prevented from asserting their rights. It is not, now, necessary, that a bankrupt should be made a party to a bill against his assignees (4); though the contrary was formerly held. (5) But, though it is not necessary that the bankrupt should be joined in the suit, it is not a ground of demurrer if he is made a party to it, more especially when he is charged as a confederate in a fraud. As where a bill was filed against a bankrupt and his assignees, stating a fraudulent bankruptcy concerted to defeat the plaintiff's execution, and praying a discovery and an injunction against an action threatened by the assignees and the bankrupt demurred, alleging that he was not concerned in the suit, and that the discovery was matter of evidence between the plaintiff and the other defendants, to which he might be examined as a witness; — Lord Loughborough said, there was no pretence for the demurrer, which was accordingly overruled. (6) And it seems to be generally understood, that if any discovery is sought of the bankrupt's conduct before he became (1) Ibid. (2) See the cases on this subject collected in the notes to the case of Elmslie v. M'Aulay, 3 Bro. C. C. 624. Eden's edition. (3) Wilkins v. Fry, 1 Meriv. 1. 2 Rose, 371. (4) Degolls v. Ward, 2 P. Wms. 311. note. Collet v. Wollaston, 3 Bro. 228. Griffin v. Archer, cit. 2 Ves. jun. 645. Whitworth v. Davis, 1 Ves. & B. 545. Lloyd v. Lander, 5 Mad. 282. (5) Sharp v. Gamon, 2 Vern. 52. (6) King v. Martin, 2 Ves. jun. 641. bankrupt, he must answer to that part of the bill for the sake of discovery, and to assist the plaintiff in obtaining proof; though his answer cannot be read against his assignees. (1) sure against a bankrupt mortgagor. Bill filed by a cre Where a mortgagor becomes bankrupt, and a bill of Bill of foreclosure is filed against him and his assignees, the forecloCourt will not, on the application of the assignees alone, make an immediate decree under the 7 G. 2. c. 20.(2) Where a bill was filed by a creditor (upon a debt accruing after the bankruptcy) against the assignees, as well as the executor of the bankrupt, for an account (on the ground of there being a surplus), and to restrain the assignees from paying the surplus to the executor, and the assignees demurred to the bill; -the demurrer in this case was allowed, as the executor only was liable to the creditor, and the assignees to the executor. (3) ditor on a debt after the bankruptcy. Upon a bill filed by the assignees for the discovery of a When defendants bankrupt's effects, the defendants will not be permitted to not perlook into their depositions taken before the commissioners, to assist them in putting in their answer. (4) In case of the death, or removal, of the assignees, the new assignees were obliged before the recent statute, to file a supplemental bill to entitle them to the benefit of the proceedings in a suit begun by the former assignees; for in a case of this kind, where other assignees were by order of court put into the room of those who were dead or discharged, it was held, that there was no privity between the bankrupt and the new assignees; or, at least, but an artificial one, and therefore that they could file no bill of revivor. (5) But now by the 67th section of the new statute, whenever an assignee dies, or a new assignee is chosen in the manner specified in the act, no action at law or suit in equity shall be thereby abated; but the Court may, upon the sug (1) Mitford on Pleading, 142. (2) Garth v. Thomas, 2 Sim. & St. 188. (3) Utterson v. Mair, 4 Bro. 270. (4) Boden v. Dellow, 1 Atk. 288. mitted to refer to their depositions. Suits will not abate by the death, or removal of assignees. How assignees of one partner may sue. gestion of such death, or removal, and new choice, allow the name of the surviving or new assignee or assignees to be substituted in the place of the former; and such action or suit shall be prosecuted in the name or names of the surviving or new assignee or assignees, in the same manner as if he or they had originally commenced the same. And by section 89. in any commission against one or more of the members of a partnership, the assignees may, upon obtaining the order of the Lord Chancellor, prosecute any suit or action in the names of such assignees, and of the remaining partner or partners against any debtor of the partnership; and may obtain such judgment, decree, or order, as if the action or suit had been instituted with the consent of the other partners. names; SECTION II. Of Actions at Law, and herein of Proceedings against the Sheriff. Assignees The 63d section of the new statute, as we have already may sue in seen (1), has given the commissioners power to assign (among their own the bankrupt's other property) all debts due to him; which are declared to vest in the assignees as fully, as if the assurance whereby they may be secured had been made to the assignees themselves; and it has also given them the like remedy to recover the debts in their own names, as the bankrupt himself might have had. This is a peculiar privilege possessed by the assignees of a bankrupt; for every other assignee of a debt is obliged at law to sue for the recovery of it in the name of the assignor. (2) (1) Ante, 385. (2) In like manner a trustee under the Scotch bankrupt act (the 54 G. 3. c. 137.) cannot in an English court of law sue in his own name for a chose in action, that statute conveying only a right of property to the trustee, and not a right of suit. Jeffery v. M'Tag gart, 6 M. & S. 126. |