
    Charles A. O’Niel, as Assignee, etc., Resp’t, v. Samuel Nagle, App’t.
    
    
      (New York Court of Common Pleas, General Term,
    
    
      Filed April 2, 1888.)
    
    1. Assignment for benefit of creditors—Preferences not allowed by New Jersey law. x
    The defendant, a resident of New Jersey, owed a debt to a resident of New York, who made an assignment to this plaintiff, with preferences. Creditors of the assignor, resident in New Jersey, began an action against him in that state, and obtained a process of foreign attachment, under which a debt owing him by the defendant was duly attached in New Jersey. Held, that the assignment made, although valid in this state, was void under the laws of the state of New Jersey, which did not tolerate preferences.
    2. Debt—Situs of—At domicile of creditor—General law may be CHANGED BY LOCAL STATUTE BO THAT SITUS OF DEBT IS AT DOMICILE OF DEBTOR.
    t Held, that under general jurisprudence, a debt had its situs at the domicile of the creditor, but that the laws of New Jersey having fixed the situs of the debt for the purpose of the attachment at the domicile of the debtor., it might be effectually attached against the non-resident creditor, and that compulsory payment under the attachment would protect the debtor everywhere against an action by the creditor for the recovery of the same debt.
    Appeal from a judgment of the general term of the city court of New York, entered December 26, 1887, affirming a judgment rendered at the trial term, by Chief Justice McAdam, sitting without a jury, on October 13, 1887, in favor of plaintiff, for the sum of $738.38.
    
      Charles D. Ridway, for app’lt; Jeroloman & Arrow-smith, for resp’t.
    
      
       See 10 N. Y. State Rep., 706.
    
   Van Hoesen, J.

Nagle is a resident of New Jersey, and is bound by its laws. Everitt and Pidcock are also residents of New Jersey. Nagle owed a debt to one _Hea.lv, who made an assignment for the benefit of creditors to O’Neil, the plaintiff.

Healy owed a debt to Everitt and Pidcock. The assignment for the benefit of creditors made by Healy is valid according to the laws of the state of New York, but is void under the laws of the state of New Jersey, because it gives a preference to a creditor, and preferences are not tolerated in New Jersey. Everitt and Pidcock began in New Jersey a suit for the collection of their demand against Healy, who is a resident of New York, and obtained the process of a foreign attachment, under which the debt owing by Nagle to Healy was duly attached in the hands of Nagle, in the state of New Jersey.

Under the laws of New Jersey, the debt having been attached, and a return having been made by the sheriff, the court appointed an auditor to adjust and audit the amount due from Healy to Everitt and Pidcock, but it does not appear that Nagle has as yet been compelled to pay to Everitt and Pidcock the amount of the debt to Healy. Pinal judgment against Healy had not been entered in favor of Everitt and Pidcock at time the answer in this action was interposed, nor does it appear that it has since been entered.

The city court held that if Everitt and Pidcock had been able to lay hold of any visible and tangible thing belonging to Healy, it would have been subject to the process of foreign attachment, if found in the state of New Jersey, notwithstanding the assignment made to O’Neil, but as the property attached is only a debt due to Healy—an incorporeal thing—it was not within the jurisdiction of the courts of New Jersey, and, therefore, the sheriff did not, and could not, attach it, and acquire a right to hold it, and to subject it to the payment of any judgment that might be recovered by Everitt and Pidcock against Healy.

The cases of Guillander v. Howell (35 N. Y., 662), and Howard National Bank v. King (10 Abb. New Cases, 346), are cited as authorities for that conclusion. Of the case of Howard v. King, it is not necessary to say more that that it was well decided upon the facts, and that the observations made upon the liability of a debt to attachment at a place in which the creditor does not reside, do not profess to be anything more than an acquiescence in the dicta of the late Judge Peckham in Guillander v. Howell.

In Guillander v. Howell, all that Judge Peckham said respecting the liability of a debt to attachment in the state in which the debtor lives, but in which the creditor does not live was obiter.

What the court decided in that case was that a New Jersey creditor of a New York debtor could attach and hold a steam boiler found in New Jersey, though before the attachment was levied the debtor had made an assignment for the benefit of creditors, which would have conveyed the boiler to the assignee, if the assignment had not been void in New Jersey, because, in violation of the law of that state, it gave preferences.

Judge Peckham, at the beginning of his opinion, leaves no room for doubt as,,to the only point that he intended to decide. Though others besides Judge Peckham: have discussed the feasibility of drawing a distinction between tangible and intangible property, and of holding that tangible property may be attached wherever it is found, but that intangible property can be attached nowhere save at the place of the owner’s residence, there is not, to the best of my information, any decision in this state that overrules the' case of Embree & Collins v. Hanna (5 Johns., 101), which is an express authority for the proposition that a debt due to a citizen of New York from a resident of another state may be attached in that state under the garnishee process by another resident of that state, to whom the citizen of New York is indebted.

There are cases that go far beyond the decision in Embree v. Hanna, and which permit a citizen of a state to reach the earnings of another citizen of the same state by bringing an action, and pursuing the garnishee process, in a foreign jurisdiction, the laws of which do not exempt wages of a workman from seizure, though such wages are exempt by the laws of the state in which both the plaintiff and the defendant reside. Such a case is that of Dealing v. N. Y. and New Haven R. R. Co., 8 N. Y. State Rep., 386; and such are the following cases: Moony v. Union Pac. R. R. Co., 60 Iowa, 346; The City of New Bedford, 20 Fed. Rep., 57; Broadstreet v. Clark, 65 Iowa, 670; Burlington v. Thompson, 31 Kans., 180; Wilson v. Joseph, 5 West. Rep,, 681; Stevens v. Brown, 20 W. Va., 450.

In all these cases the courts treating the suggestion that debts can have no other situs than the home of the creditor as of no force.

If it were true that the debts could not be reached by the garnishee process except in the state where the person to whom they aré owing resided, there would have been a perfect answer to the process of foreign attachment in every one of the cases that I have cited.

But it is idle to enter into a discussion of the matter, because the court of appeals, in a recent case has passed upon the point.

In Williams v. Ingersoll (89 N. Y., 508), Judge Earl said, “A debt always, under general jurisprudence, has its situs either at the domicile of the creditor, or where the written obligations upon which it is due are held, and not at tho situs of the debtor. Hence, under general public law, recognized by all courts, there was nothing in Connecticut to attach. But local laws may fix the the situs of the debt at the domicile of the debtor, and, under such laws, it may be effectually attached against a non-resident creditor, and com - pulsory payment under the attachment will protect the debtor everywhere against a suit for the recovery of the same debt by the creditor. The law seems to be thus settled, for the reason that it would be unjust to compel the debtor to pay his debt twice.” Citing Embree & Collins v. Hanna, 5 Johns., 101.

Like any other property, a debt may, therefore, be subjected to process of foreign attachment whenever the laws of a state declare that it shall be.

There is no doubt that the laws of Hew Jersey do make debts attachable, and fix the situs of the debt, for the purposes of the attachment, at the domicile of the debtor. Hor is there any doubt that the assignment under which the plaintiff claims, is invalid under the laws of Hew Jersey. The statutes of that state, as expounded by the courts, entitle Everitt and Pidcock to attach the debt in suit in the hands of Hagle, and he may be compelled to pay it to the sheriff in Hew Jersey. He may, therefore, now successfully plead the attachment in abatement, and, if compelled to pay the debt to the sheriff, he may plead that payment in bar of the demand that O’Heil is making upon him. Varnum v. Camp, 1 Green, 326; Moore v. Bonnell. 2 Vroom., 90; Van Winkle v. Armstrong, 41 N. J. Eq., 404. Warner v. Jaffray, 96 N. Y., 248.

The judgment must be reversed, and a new trial ordered, with costs to abide the event.

Daly, J., concurs.  