
    George Wahlheimer and Henry Kretsch, Carrying on Business as Copartners under the Name and Style of J. H. Miller, Respondents, v. Charles W. Truslow, Individually and as Trustee of the Estate of William Wall, Deceased, and George E. P. Howard, Appellants.
    
      Conveyance by a debtor in fraud, of his creditors—it is not necessary that all of a creditor’s claim, should have accrued before the conveyance is made — the judgment creditor’s right is not affected by proceedings in bankruptcy instituted after liis suit is begun and a discharge therein before a lis pendens is filed, where no trustee in bankruptcy is appointed — an equitable lien is created by the commencement of the action — when a money judgment is proper — effect of the appointment of a trustee in bankruptcy.
    
    William Wall Weaver, who was the owner of a sixteenth interest in certain real estate, the value of which interest was upwards of $3,000, transferred such interest to one Truslow. At the time of the transfer Weaver was, to the knowledge of Truslow, in financial difficulties and the interest transferred by him constituted all his property. Truslow owned a similar interest in the real estate in question and his purpose in taking the assignment was to preserve the share of Weaver and to prevent it from' falling into the hands of persons who might force a sale of the real property.
    In an action brought by a judgment creditor of Weaver to set aside the assignment executed by the judgment debtor, it was
    
      Held,, that the evidence was sufficient to support a finding that the assignment was made with intent to hinder, delay and defraud Weaver’s creditors;
    That it Was not material that only a portion of the claim included in the plaintiffs judgment had accrued at the time of the execution of the assignment sought to he set aside, as, if a conveyance is fraudulent as to existing creditors, it may also be attacked by subsequent creditors;
    That a discharge in bankruptcy obtained by Weaver subsequent to the commencement of the judgment creditor’s action, in proceedings instituted by him ■ shortly before the commencement thereof, was not a bar to the judgment - creditor’s action, even though the discharge in bankruptcy was obtained .prior to the filing of the Us pendens in the judgment creditor’s action;
    That prior to the commencement of the judgment creditor’s action, the judgment creditor had only an equitable interest in the real estate in question, but that • the commencement of the action created an equitable lien upon "such interest, and that the filing of the Us pendens was not necessary to effect such equitable lien;
    That no trustee of Weaver’s property having been appointed in the bankruptcy proceedings, the judgment creditor could proceed to the enforcement of. the lien obtained before the discharge in bankruptcy, for the reason that the effect of such discharge was personal to the judgment debtor only;
    That, as no accounting was necessary, a money judgment could properly be rendered in the judgment creditor’s action.
    Semble, that if. a trustee of Weaver’s property had been appointed in the bankruptcy proceedings, the right to maintain the action would have vested in such trustee, and that the lien acquired by the judgment creditor by the commencement of the action would not have given him priority over other creditors, for the reason that the. action was not begun more than four months before the filing of the petition in bankruptcy.
    Appeal by the defendants, Charles W. Truslow, individually and as trustee of the estate of William Wall, deceased, and another, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of Kings on the 13th day of June, 1904, upon the. decision of the court rendered after a trial at the Kings County Special Term.
    
      Henry W. Jessup, for the appellants.
    
      J. Noble Hayes, for the respondents.
   Miller, J.:

This is a creditor’s action in which it appears that the judgment debtor, William Wall Weaver, was the owner of an equitable interest in certain real estate acquired by the defendant Truslow as trustee on the foreclosure of certain mortgages belonging to the trust estate, the said Weaver being entitled to a beneficial one-sixteenth interest therein, and the said Truslow also being a beneficiary entitled to a like share. Ón the 1st day of September, 1893, said Weaver assigned his interest to the defendant Howard, who occupied offices with the defendant Truslow, and had been acting as attorney for him as trustee aforesaid. The consideration for such assignment was the sum of §800, either furnished by the defendant Truslow at the time, or soon thereafter repaid by him to said Howard. The trial court has found, upon evidence which supports the finding, that the interest so assigned was of the value of upwards of §3,000, and that the assignment in form to the defendant Howard was in. fact an assignment directly to the defendant Truslow. Said interest was all that remained to the said Weaver out of a share amounting to upwards of §60,000, and constituted his entire estate at the time. The assignment was made as the result of an application by him to the defendant Tnislow for money which he stated was desired by him to pay a hotel bill of §750 at Seabright in order to obtain the personal effects of himself and wife which were being held as security for said, bill. The defendant Truslow claims that he procured the defendant Howard to advance the money and take an assignment of the interest to prevent its falling into the hands of money lenders who he feared might compel a sale of the real property, resulting in loss to the beneficiaries, and it may fairly be inferred from the testimony that he also feared that the creditors of Weaver might cause a' like embarrassment. The view of the transaction most charitable to the defendant Truslow is that the assignment was procured by him to preserve the share of said Weaver and to prevent its falling into the hands of persons who might force a sale of the property which he deemed disadvantageous to the estate, and whether he intended ultimately to turn over to Weaver any surplus or to keep it himself is quite immaterial, for in either event his act “ hindered ” and delayed ” creditors.. The evidence clearly indicates that the defendant Truslow understood the pressing need of Weaver for money, and the inference is irresistible that he must have known that Weaver had creditors and that he was obtaining by the assignment all of the property available for the satisfaction of the claims of such creditors. These facts, together with the circumstance that the- consideration paid was less than one-third of the value of the interest assigned, are sufficient to support the finding that said assignment -was made to hinder, delay and defraud creditors. It is also found that said Weaver did not have adequate knowledge óf the value Of the property so assigned, and that said TrusloW overreached the said’ Weaver to whom lie stood in a fiduciary relation. The. appellants insist that so. far as the fraud’perpetrated upon Weaver is concerned, his Creditors- do not stand in his shoes, but that the transaction as to him Was voidable and not void, and that he alone could elect to ratify or disaffirm it. It is tin-necessary to consider this question, because the finding that the assignment Was fraudulent as to- creditors- being warranted by the evidence, sufficiently supports the judgment appealed from, and there is" no inconsistency in the finding that the transaction was fraudulent both as to Weaver and his creditors, although we prefer on this appeal to rest Otir decision, on the more charitable; assumption which eliminates the theory of an intent to- defraud Weaver, ánd proceed only on the theory' that the transaction of necessity had the effect of hindering aiid delaying creditors- as the defendant. Truslow must have known when he procured the assignment to be made.

The judgment which is the. basis of this action was- obtained April- . 24, 1896, for the sum of $522.14, only $150 of Which had- be'en contracted at the time of the assignment sought to be set aside,,but this, is immaterial, as if á. conveyance is fraudulent as to existing' creditors' it may also be attacked by subsequent creditors. (King v. Wilcox, 11 Paige, 589; O'Brien v. Whigam, 9 App: Div. 113; Dewey v. Moyer, 72 N. Y. 70, 76.) If the assignment is made with- fraudulent intent, the statute makes it void as against every person “ hindered, delayed or defrauded.” (See 2 R. S. 137, § 1;. revised by Real Prop. Law [Laws of 1896, chap. 547],. § 227.) The learned trial cóitrt properly found, therefore, that' the- defendant Truslow held the proceeds resulting from, such interest as trustee ex maleficio for the- creditors of Weaver.

This action was, commenced on the 19th- day of March, 1900. On the 9th day of February, 1900, the judgment debtor filed a petition in bankruptcy, and on the 16th day of May, 1900, he Was discharged by a certificate of the United States District Court, from all debts, and claims provable against his estate. A Us pendens Was filed in this action- On. the 22d day of June, 1900. It is claimed by the appellants that the judgment debtor’s discharge in bankruptcy is a bar to the maintenance of this action.. This defense-Was not pleaded, and no motion was made by the defendants either at the close of the plaintiffs’ case or of the entire evidence, indicating an intention on their part to rely upon it as a defense. However, assuming, without'deciding, that the facts sufficiently appeared to enable the defendants to take advantage of them, although not pleaded in the answer, we are still of the opinion that they do not constitute a defense to the action. It is undoubtedly true that the judgment which is the basis of this action was not a lien upon the real property in question ; the judgment debtor had only - an equitable interest, but the commencement of this action created an equitable lien upon such interest. (Storm v. Waddell, 2 Sandf. Ch. 494; Brown v. Nichols, 42 N. Y. 26; Lynch v. Johnson, 48 id. 27; First National Bank v. Shuler, 153 id. 163, 171.) The action is one in rem to reach the equitable interest of the judgment debtor, and the lien thus obtained was not lost by the subsequent discharge in bankruptcy of the judgment debtor, but may be enforced notwithstanding payment could not be compelled from the judgment debtor personally. The defendants, however, insist upon the authority of Ocean National Bank v. Olcott (46 N. Y. 12), that the filing of a Us pendens was necessary to create such lien, and that the judgment debtor having been discharged before the filing of the lis pendens, the judgment became extinguished, and that no lien based thereon could be created subsequently to such extinguishment. It Avill be noticed that in the case relied upon the judgment creditor’s action Avas not begun until long after the judgment debtor’s discharge in bankruptcy. The lien is created by the commencement of the action. The office of a Us pendens is to give notice to subsequent purchasers or incumbrancers. Prior to the statute the lis pendens Avas created by the filing of the bill and all persons who became purchasers or inamShvancevs pendente lite Avere bound by the judgment. The effect of the statute was to make the pendency of the action so far as it affected real estate notice only from the time of the filing of the Us pendens as provided. Had a trustee in bankruptcy been appointed, a different question might have arisen. Undoubtedly in such case the right to maintain the action would have vested in the trustee, and it is also probable that the lien acquired by the plaintiffs by the commencement of the action would not have given them priority over other creditors for the. reason that the action was not "begun more than four months before the filing of tile petition in bankruptcy, but no trustee having been appointed, the plaintiffs can proceed to ,the enforcement of their lien obtained before the discharge, because so far as the discharge itself is con- - cerned, its effect is: personal to the judgment debtor only. (Dewey v. Moyer, supra; S. C., sub nom. Moyer v. Dewey, 103 U. S. 301.)

-Bo accounting being .necessary, "a money - judgment was proper. (Baily v. Hornthal, 154 N. Y. 648.)

There are no other questions presented by the record requiring further consideration,, and the judgment should be affirmed, with, costs.

Present — Hirschberg, P. J:, Bartlett, Jenks, Rich and Miller,. JJ.,

Judgment, unanimously affirmed, with costs.,  