
    In the Matter of the Final Accounting of Charles F. Halsted, as Assignee of the Williams Ink Works, for the Benefit of Creditors. Paul Hesse and Others, Appellants; Charles F. Halsted, as Assignee, etc., of the Williams Ink Works and Others, Respondents.
    
      Foreign corporation—assignment, by, for the benefit of creditors — it is subjut to the General Assignment Act as to preferences.
    
    An assignment, for the benefit of creditors, of property situated in the State of New York, executed in that State by a foreign corporation doing business therein, is subject to the provisions of the General Assignment Act (Laws of 1877, chap. 466), including section 80 thereof, which provides that preferences contained in a general assignment shall be valid only to the extent of one-third in value of the assigned estate.
    Appeal oy Paul Hesse and others from so much of a final order of the Supreme Court, made at the Hew York Special Term and entered in the office of the clerk of the county of Hew York on the 24th day of March, 1899, as overrules the exceptions to the report of a referee and - confirms said report, and directs that the cash in the hands of the assignee of the Williams Ink Works be paid to preferred creditors, under the general assignment for the .benefit of creditors.
    
      Tfintliroj) Parker, for the unpreferred creditors, appellants.
    
      Ambrose G-. Todd, for the preferred creditors, respondents.
   Rumsey, J.:

On the 24th of June, 1897, the Williams Ink Works, a corpora^ tion organized under the laws of the State of Virginia, but having its principal office in the city and county of Hew York and doing business in that city, where all its property was situated, executed and delivered to Charles F. Halsted an assignment for the benefit of its creditors, by which the assignee was required, after paying the expenses of his assignment and the wages due to employees, to pay to Charles M. Creswell a debt of $721 due from the Williams Ink Works to him, and to pay to Jenny E. Badger a debt which the Ink Works owed to her of $206, and out of the residue, if there should be any, the assignee was required to pay the other debts of the assignor pro rata as far as practicable. The assignee presented his account, which was referred to a referee who took and stated it, and his report was confirmed by an order of this court made on the 24th of March, 1899. From that order this appeal is taken.

It appeared by the report that the net assets, after the payment of. wages, costs and expenses of executing the trust, were $592.18. The report of the referee directed that the whole of these assets be turned over to the preferred creditors, and that direction was confirmed by the Special Term. The creditors who are not preferred insist that the preference is only valid to the extent of one-third of the net assets; that that portion of the assets only should be turned over to the preferred creditors, and that the remainder should be divided among the unpreferred creditors. This contention was overruled by the learned justice at the -Special Term, and the single question presented here is as to the correctness of that ruling.

The Williams Ink Works was a foreign corporation, and, therefore, section 48 of the Stock Corporation- Law, forbidding preferences by a corporation in this State, did not apply to it. (Vanderpoel v. Gorman, 140 N. Y. 563.) It; is claimed, however, by the appellants that, although a foreign corporation may legally make a preference under the laws of this State, yet such a preference is controlled by section 80 of the General Assignment Act, which limits it to one-third of the net assets. It is quite true that a foreign corporation has its domicile in the State of its origin and nowhere else. (Shepard & Morse Lumber Co. v. Burleigh, 27 App. Div. 99.) It is also true that, in the absence of special statutory provisions of this State, a transfer of personal property made' by a citizen of another State, which is valid according to the laws of that State, will be sustained and enforced here. But that rule applies only where the laws of this State are silent with regard to the transfer of property within its jurisdiction. It cannot be denied that each State and country has the right to regulate the transfer of personal property within its territories (Milne v. Moreton, 6 Binn. 361); and when it has done so, the principle of comity, by which a transfer that is valid in the State of the domicile of the owner will be enforced, is at an end and must give way to the provisions of the statutes of the country where the property is situated. (Green v. Van Buskirk, 5 Wall. 307 ; S. C., 7 id. 139 ; Keller v. Paine, 107 N. Y. 83 ; Warner v. Jaffray, 96 id. 248.)

The property which was assigned here is situated in this State. The assignment was made in this State. That it was intended to be made pursuant to the laws of this State is apparent from the fact that it complies in all respects with the requirements of our statute; that it was accepted and executed by the assignee as the statute requires, and that it was recorded in the county of Yew York. But it is a matter of no importance whether it was intended by the parties to it to be made pursuant to the laws of this State or not. It was made in this State, and it undertook to transfer property situated in the State, and necessarily it was subject to the laws which have been made in this State in regard to instruments of that kind. Our General Assignment Act (Chap. 466, Laws of 1877) establishes regulations for every assignment made by a debtor of his real or personal property, or both. An assignment, to be valid in this State, must comply with the regulations laid down in that statute. One of those regulations is that in all general assignments * * * for the benefit of creditors hereafter made, any preference * * * shall not be valid except to the amount of one-third in value of the assigned estate, left after deducting such wages or salaries, and the costs and expenses of executing such trust.” (§ 30, snprai) This provision of the statute applies to this assignment, as it does to every other assignment made within the State. For this reason the referee was in error in prescribing that the whole amount of the assets should be applied to the payment of the preferred debts, and the order should have provided that one-third of the assets be paid to the preferred creditors in the manner directed by the assignment, and that the remainder be divided pro rata among the unpreferred creditors.

The order, therefore, must be modified by thus providing, and as modified, it must be affirmed, with costs to the appellants.

Yan Brunt, P. J., Barrett, O’Brien and McLaughlin, JJ., concurred.

Order modified as directed in opinion, and as modified, affirmed, with costs to the appellants.  