
    Spies and others v. A. Joel and L. Joel.
    
      At Chambers,
    
    February, 1853.
    Semble,—That when an assignment made by a debtor, of all his property, for the purpose of satisfying particular debts, contains no provision relative to a possible surplus, the omission is not such evidence of an intent to defraud his creditors as will be deemed sufficient to warrant his arrest.
    If the omission is, upon such an application, evidence at all, it is a presumption only that it raises, and this presumption is conclusively rebutted by showing that the preferred debts exceeded the value of the property.
    This was an application on the part of the defendants to vacate an order of arrest, which had been granted on the allegation that they had disposed of their property, with intent to defraud their creditors (Code, § 178, sub. 5).
    It appeared that before the commencement of the suit they had made an assignment of all their property, directing that the avails should be applied to the payment of all the debts owing by them to certain creditors who were named, but containing no provision relative to the disposition to be made by the assignee of any surplus that might remain after the satisfaction of the debts specified, and this omission was relied on by the counsel for the plaintiffs, as conclusive evidence of a fraudulent intent, making it the duty of the judge to sustain the order of arrest.
    It was, however, conclusively shown by the affidavits on the part of the defendants, that the preferred debts largely exceeded in amount the whole value of the property assigned, and that this was known to the parties when the assignment was made.
   Duer, J.

It may be true,' as the counsel for the plaintiffs has contended, that the court of appeals, by its recent decisions, has settled the law, that the omission in an assignment, giving preferences, of any provision relative to a possible surplus, is evidence of a fraudulent intent, which renders the assignment void under, the statute. But, in my judgment, it is only a constructive fraud which is thus established, for I cannot regard the omission as. evidence j)err se of an actual intent, existing in the mind of the debtor and governing his act; and I am clear in the opinion that it is proof of an actual intent, that in all cases, in which fraud is charged, ought to be required to justify or sustain an order of arrest. The constructive guilt of a debtor, who is innocent in fact, can never be held by me to be a sufficient ground for his imprisonment.

Let it be admitted, however, that such an omission as is now relied on affords some evidence of a fraudulent intent, actually existing ■ in the mind of the debtor, it is undeniable that it is a presumption only that it raises; a presumption which the debtor is competent to meet and repel, and which in the case before me is conclusively repelled. It is proved to my entire satisfaction, that the property assigned will be insufficient to satisfy the debts which are directed to be paid, and that tliis insufficiency was known to the parties when the assignment was executed. It is manifest, that there could have been no intent to defraud the. general creditors by the appropriation of a surplus to the use of the defendants, if not only no such surplus was expected to arise, but it was certainly known that none would exist, and such I am satisfied were the facts. Order vacated, and defendants discharged.

Approved by Oakley, Oh. J., Campbell and Boswobth, J.J.  