
    George C. Ball, Assignee, &c., v. Freeman Loomis, and others.
    Where the question is whether an assignment, made by an insolvent debtor in trust for the benefit of his creditors, is fraudulent in fact, the finding of the referee, upon conflicting evidence, that it is not fraudulent, cannot be legally disturbed by the supreme court.
    Notwithstanding the supreme court may reverse on a question of fact, such reversal must be consistent with the rules of law.
    It is not an irreversable and unqualified rule of law that there must.be an actual and continued change of possession, in order to shield an assignment of property in trust for the benefit of creditors from the imputation of fraud.
    The fact of there being no change of possession, is presumptive evidence of fraud, and conclusive, unless rebutted by affirmative evidence of good faith and the absence of an intent to defraud.
    Judgment creditors who direct the sheriff to sell property which has been assigned by the judgment debtor in trust for the benefit of creditors, and who indemnify him for so doing, are jointly liable with the sheriff to the assignee for such illegal act.
    
      Appeal from a judgment of the Supreme Court reversing a judgment entered at a Special Term on the report of a Referee.
    
    The action was brought by the plaintiff as assignee of Toynbee and Hopkins, under an assignment in trust for the benefit of creditors, against the sheriff of Kings county and various' creditors of the assignors, under whose several executions the sheriff had levied upon and sold the property of .the assignors. The referee found the following facts: That Thomas Toynbee and Josiah Hopkins, with the' plaintiff, on the Mth day of April, 1865, executed, and the said Toynbee and Hopkins delivered to the plaintiff, the instrument of assignment mentioned in the complaint; that at the time of the execution of the said assignment, and for a considerable time prior thereto, the said Toynbee and Hopkins were and had been the keepers, as co-partners, of a hotel and restaurant, in the city of Brooklyn; that at the time of ■ executing said assignment, the debts of the assignors exceeded the value of their property, and they were embarrassed in them circumstances and threatened with suits; that immediately after the execution of the said assignment, and on the same day, the plaintiff entered into and took possession of all of the assigned property, and continued in the possession thereof until the same was taken away from him by the defendants, as hereinafter mentioned; that the plaintiff, after he so took possession, kept the place open, continued the business, and advertised in the New York Herald for a purchaser of the establishment; that he employed one of the assignors, Mi*. Toynbee, to keep the books; and that the other, Mr. Hopkins, remained upon the premises, with his wife, assisted the assignee, and, with her, boarded at the house, without being charged for board; that the creditors of the assignors knew of, and assented to, the course pursued by the assignee in so keeping the said place open, and continuing the said business; that subsequent to the execution and delivery of the said assignment, and at and before the time of the talcing of the said goods and chattels, as hereinafter mentioned, the defendant, Lott, as sheriff of the county of Kings, held the executions mentioned in the several answers in this action against the said Thomas Toynbee and Josiah Hopkins; and that the defendant Hegeman was a deputy sheriff of the said county; and that the judgments • and executions mentioned in .the defendants’ answer were obtained and issued as therein stated; that the defendant Hegeman, deputy sheriff, and acting under the direction of the defendant Lott, sheriff, forcibly took from the possession of the plaintiff, and sold the goods, chattels, and property mentioned in the complaint, which had been assigned to the plaintiff, claiming to levy upon and sell the same by virtue of said executions, as the property of said Toynbee & Hopkins; and that the other defendants directed the said taking and sale, and indemnified the said Lott, the sheriff, from all loss or liability by reason of the said taking and sale. The referee further found, that the value of the said goods, chattels, and property, at the time of the taking away of the same by the defendants, was $3,300; and that the said assignment was not made with intent to hinder, delay, or defraud-the creditors of the said Toynbee & Hopkins, the assignors; and the referee found, as a conclusion of law, that the said assignment was not invalid, insufficient, illegal, or void, but that the same was and is valid. - He further found, as a conclusion of law, that the defendants wrongfully took and carried away the said goods-and chattels, and that they were guilty of the trespass laid to their charge in the complaint; and that the plaintiff was entitled to recover from the defendants the said sum of $3,300, with interest thereon, together with his costs. Judgment being entered upon this report at a special term, the defendants appealed to the general term, which reversed the judgment
    
      P. V. R. Stanton, for the appellant.
    
      John K. Porter, for the respondents.
   Hogeboom, J.

The plaintiff appeals from a judgment of the supreme court reversing a judgment for the plaintiff, entered on the report of a referee, and ordering a new trial, and stipulates for final judgment against him in case of affirmance. The action was by the assignee of insolvent debtors, against the sheriff and his deputy (and their indemnitors, the plaintiffs in certain executions in their hands against the insolvent debtors) for seizing and selling certain personal property assigned by the insolvent-firm to him; and the question was whether the assignment was fraudulent in fact. The referee held, upon conflicting evidence, that it was not. The supreme court, on appeal, held that it was. This raises the first question for consideration. I think the evidence was sufficient to justify the finding of the referee, and that such finding could not be legally disturbed by the supreme court. Notwithstanding that court might reverse on a question of fact, such reversal must be consistent with the rules.of law. The-court, in speaking of certain indicia of fraud, themselves declare the correct rule when they say “ they are, however, not conclusive in themselves, but only tend to show a fraudulent design; and if a jury should deem them consistent with the bona fides of the transaction (as the referee doubtless has done), the verdict, as well as this report, could not be disturbed on that ground alone.” This rule was applicable to all the questions of fact considered by the court, and should have controlled the result. The court were of opinion that there was not an immediate delivery and an actual and continued change of possession, and that therefore the assignment was fraudulent and void. The court, erred, I think, both on the fact and the law—that is, on the fact, there was sufficient evidence of an actual and continued change of possession and of the consent of the defendants who were plaintiffs in the executions, to the course pursued by the assignee, to put the conclusion of the referee on this disputed question of fact beyond the reach of reversal in the court above; and on the law, it is not correct to say that it is .an irreversable and unqualified rule of law that there must be an actual and continued change of possession in order to shield the transaction from the imputation of fraud. Such facts are presumptive evidence of fraud, and conclusive unless rebutted by affirmative evidence of good faith and the absence of an intent to defraud.

The other point on which the court below granted a new trial was for over-ruling the objection made by the defendants to the plaintiff’s question whether the assigned property would probably have brought as large a sum of money, if sold by the assignee, if the place had been closed, as by continuing it open. The only objection made to this question was that it was irrelevant. It plainly was not so, as it tended to show good faith and the absence of a fraudulent intent on the part of the assignee.

The other objections to evidence were also, I think, properly over-ruled. For the purpose of showing that steps were taken by the .assignee to sell the assigned property, it was proved that it was advertised for sale in the New York Herald and Brooklyn Eagle. This was objected to as incompetent, and the referee held it so, unless followed up by other competent testimony. To this holding the defendants excepted, but I perceive no legal objection to it. The papers were then introduced in evidence, under the defendants’ objection. The point of the objection is not perceived, further than as above stated. Counsel now .suggest that there was no evidence that it was so published by the procurement of the assignee; .but the objection does not appear to have been put on any such ground; and, moreover, the authority of the assignee for the publication was evidently either sufficiently proved or without objection assumed, at the trial.

It is further said that the referee erred'in excluding proof of declarations of the assignors.in continued possession of the property, as to their motives in assigning it. I think the exclusion was proper. It was not stated or suggested in the question or the offer that the declarations were made when the ■ assignors were in possession or were admissible on that ground; and as the referee finally arrived at the conclusion that the possession was not in them, but in the assignee, we may fairly conclude that it was for. that reason—and it would have been a sufficient one—that the objection was over-ruled.

It is further said that the referee erred in holding that ■the several judgment creditors, who had directed the sheriff to sell the property, and had indemnified him for so doing, were jointly liable to the plaintiff for such illegal act. I can not discover that this point was made at the trial, but if it had been, I think it was properly overruled. The illegal act was the trespass—the act of seizing and selling the property. In this act all the defendants were concerned, and for it they were all responsible, as they had all directed or authorized it. (Davis v. Newkirk, 5 Denio, 92; 3 Kern. 584.)

I think the judgment of the referee was erroneously reversed by the supreme court, and that the latter judgment should be reversed, and that of the referee affirmed with costs.

Sellen, J., also read an opinion in favor of reversal, and all concurred except Ingraham and Mullin, JJ., who were for affirmance, simply on the ground that the general term should have found the existence of fraud. Judgment reversed.  