of the uncle to become a trustee before he will be held to have become such; but in an effort to ascertain the construction which should be given to it, we are also to observe the rule that the language of the promisor is to be interpreted in the sense in which he had reason to suppose it was understood by the promisee: White v. Hoyt, 73 N. Y. 505, 511. At the time the uncle wrote the letter he was indebted to his nephew in the sum of five thousand dollars, and payment had been requested. The uncle, recognizing the indebtedness, wrote the nephew that he would keep the money until he deemed him capable of taking care of it. He did not say, "I will pay you at some other time," or use language that would indicate that the relation of debtor and creditor would continue. On the contrary, his language indicated that he had set apart the money the nephew had "earned" for him, so that when he should be capable of taking care of it he should receive it, with interest. He said: "I had the money in the bank the day you were twenty-one years old that I intended for you, and you shall have the money certain." That he had set apart the money is further evidenced by the next sentence: "Now, Willie, I don't intend to interfere with this money in any way until I think you are capable of taking care of it." Certainly, the uncle must have intended that his nephew should understand that the promise not "to interfere with this money" referred to the money in the bank, which he declared was not only there when the nephew became twenty-one years old, but was intended for him. True, he did not use the word "trust," or state that the money was deposited in the name of William E. Story, 2d, or in his own name in trust for him, but the language used must have been intended to assure the nephew that his money had been set apart for him, to be kept without interference until he should be capable of taking care of it; for the uncle said, in substance and in effect: "This money you have carned much easier than I did . . . . you are quite welcome to. I had it in the bank the day you were twenty-one years old, and don't intend to interfere with it in any way until I think you are capable of taking care of it, and the sooner that time comes the better it will please me." In this declaration there is not lacking a single element necessary for the creation of a valid trust, and to that declaration the nephew assented.

The learned judge who wrote the opinion of the general term seems to have taken the view that the trust was exe

cuted during the lifetime of defendant's testator by payment to the nephew; but as it does not appear from the order that the judgment was reversed on the facts, we must assume the facts to be as found by the trial court, and those facts support its judgment.

The order appealed from should be reversed, and the judgment of the special term affirmed, with costs payable out of the estate.

CONSIDERATION, WHAT MAY CONSTITUTE. — Any act done by the promisee at the request of the promisor, however trifling the loss to himself or the benefit to the promisor, is a sufficient consideration: Doyle v. Dixon, 97 Mass. 208; 93 Am. Dec. 80. Abstaining for a certain time from the use of intoxicating drinks is a sufficient consideration to support a contract: Lindell v. Rokes, 60 Mo. 249; 21 Am. Rep. 395.

STATUTE OF FRAUDS AS A DEFENSE, whether must be pleaded or not, and whether it will be considered as waived if not pleaded, see Feeney v. Howard, 79 Cal. 525; 12 Am. St. Rep. 162, and note 171, 172; Barr v. O'Donnell, 76 Cal. 469; 9 Am. St. Rep. 242.

TRUST, WHAT DECLARATION IS SUFFICIENT TO RAISE: See Mannix v. Purcell, 46 Ohio St. 102; 15 Am. St. Rep. 562, and note 583, 584; Beaver v. Beaver, 117 N. Y. 421; 15 Am. St. Rep. 531, and note; Barr v. O'Donnell, 76 Cal. 469; 9 Am. St. Rep. 242, and note. A parol declaration of trust with respect to personalty is sufficient: Pitney v. Bolton, 45 N. J. Eq. 639; MacConnell v. Lindsay, 131 Pa. St. 476.

KNOWER V. CENTRAL NATIONAL BANK. FIRST NATIONAL BANK OF PATERSon v. Same.

[124 NEW YORK, 552.]

--

A

ASSIGNEE FOR BENEFIT OF CREDITORS BOUND TO EXECUTE ASSIGNMENT UNTIL AVOIDED. An assignment for the benefit of creditors in due form, being valid as between the parties, and if fraudulent as to creditors, only voidable by adjudication, at their election, or that of some one of them, must, until an attack is made with a view to such a judicial determination, be treated as valid, and its directions be executed by the assignee. PAYMENT BY ASSIGNEE FOR BENEFIT OF CREDITORS TO CREDITOR VESTS TITLE IN LATTER, THOUGH ASSIGNMENT SUBSEQUENTLY AVOIDED. payment made by an assignee for the benefit of creditors to a creditor of the assignor of the amount of the debt due him, pursuant to the directions in the assignment, before any lien is obtained upon the fund, is effectual to vest in such creditor title to the money so paid, although the ass gn. ment be, in an action subsequently commenced, adjudged fraudulent and void as against the creditors of the assignor. And the mere fact of knowledge on the part of the creditor so paid of the intent of the debtor to defraud his other creditors does not prejudice his right to seek and obtain payment.

ACTIONS brought to require the defendant bank to refund a sum of money received by it from the assignee for the benefit of creditors of Halstead, Haines, & Co. The first complaint alleged that in July, 1884, Halstead, Haines, & Co. made to one May a general assignment for the benefit of their creditors, and by it directed the assignee to pay a number of preferred debts, and, among others, the claim of the defendant, amounting to forty thousand dollars; that on October 17, 1884, he paid this sum to the bank; that on September 20, and October 18, 1884, the plaintiffs recovered judgments against Halstead, Haines, & Co., upon which executions were issued and returned unsatisfied; that in January, 1885, plaintiffs commenced actions to set aside the assignment as fraudulent, and recovered judgments in said actions on December 12 and 13, 1885. It was also alleged on information and belief that in August, 1884, Halstead, Haines, & Co., after making the assignment, with fraudulent intent colluded with their preferred creditors, including the defendant bank, so that it, with full knowledge of the fraudulent design of Halstead, Haines, & Co., and with like design on its part, obtained judgment against Halstead, Haines, & Co. for their claim so preferred, it being confessed by them in favor of the bank; that executions were issued on these judgments to the sheriff, requiring him to seize and hold the assigned property, and thus secure it from the efforts of the unsecured creditors; that the sheriff allowed the assignee to sell the property under the assignment, which he did, and the executions were returned unsatisfied. It was also alleged that when the assignee paid the money to the defendant, it knew that a suit was pending brought by creditors of Halstead, Haines, & Co., other than these plaintiffs, to set aside the assignment as fraudulent, and that in January, 1888, judgment was rendered in this action, setting aside the assignment. The complaint then alleged that the assignment was made. by Halstead, Haines, & Co. with intent to hinder, delay, and defraud their creditors, including the plaintiffs. The complaint in the second action was substantially the same, except that it did not allege the recovery of any judgment by plaintiff setting aside the assignment; nor did it claim that the defendant bank was in any way connected with any fraud in the assignment or its execution. One of the grounds of demurrer in each case was, that the complaint did not state facts sufficient to constitute a cause of action. The demurrers were sustained. Other facts appear from the opinion.

John J. Adams, for the appellants.

George A. Strong, for the respondent.

BRADLEY, J. This controversy presents the question whether or not a creditor of an assignor for the benefit of creditors can retain the money paid to him by the assignee pursuant to the direction in the assignment as against another creditor, who, by action subsequently brought, succeeds in setting aside the assignment as fraudulent against the creditors of the assignor. It is urged on the part of the plaintiffs that the creditor, receiving payment of his debt from the assignee, takes it subject to the condition that the assignment remains effectual, and that when the assignment falls, the title of the creditor to the money so paid him pursuant to its direction fails, and that, for the purpose of the remedy of the attacking creditors, the money so paid must be treated as part of the estate of the debtor, to be accounted for by the creditor receiving it. This proposition is founded upon the assumption that he receives the payment and takes the money through the title vested by the assignment in the assignee, and not otherwise.

It is a familiar rule that a debtor may voluntarily pay such of his creditors as he pleases, and they may take payment to the exclusion of others, and thus exhaust all his property. And at the time the one in question was made, an insolvent debtor might legitimately accomplish the same thing by means of a preferential assignment of his entire property for the benefit of his creditors. Although this necessarily had the effect to withdraw his estate from the ordinary legal process, and thus operated to hinder the creditors in the collection of their debts, it was valid if made in good faith, and did not unnecessarily, by its directions, delay the appropriation of the assigned property to the payment of creditors in the order provided for by the assignment. When the trust is accepted by the assignee, he may be compelled to execute its directions, and it is irrevocable by the assignor. And the question whether or not an assignment is fraudulent in fact as against the creditors of the assignor is not important for the purposes of the execution of it by the assignee, unless an attack by action is made upon it by them, or some of them. Until then his duty to proceed in its execution continues. And, consistently with that duty, he is entitled to have allowed to him all payments before then made by him of and upon debts of the assignor in accordance with the instructions given by the

terms of the assignment: Ames v. Blunt, 5 Paige, 15; Collumb v. Read, 24 N. Y. 505; Pond v. Comstock, 20 Hun, 492; 87 N. Y. 627.

All the creditors of the debtor are entitled to payment of their lawful claims against him if his property is sufficient to pay them; and those given a preference by his assignment are entitled to payment by force of the directions contained in it, while the assignee is at liberty to execute them. The title is vested in an assignee for the purpose merely of executing the trust in the manner directed, and essentially so to enable him to do it. And when payment is made by an assignee to the creditor pursuant to such directions, the latter receives the fund from the debtor through the execution of the trust, and his title is supported by the pre-existing debt upon which payment is made, pursuant to the right of the debtor to make and the creditor to receive it. By the commencement of an action in equity by a judgment creditor to reach the property of his debtor, he obtains a lien upon the choses in action and equitable interests of the latter, which lien becomes effectual upon the recovery of judgment for the relief sought: Edmeston v. Lyde, 1 Paige, 637; 19 Am. Dec. 454; Eager v. Price, 2 Paige, 333. This rule is not to the same extent applicable to property subject to levy of execution: Albany City Bank v. Schermerhorn, Clark & F. 297; Davenport v. Kelly, 42 N. Y. 193. No action affecting this case in which any of these plaintiffs were parties, or represented as such, was brought until after payment was made to the defendant; and no lien by relation to a time prior to that was acquired by them on the fund so paid. They must rest their claim to recover upon the position that because the assignment was fraudulent as against the creditors of the assignor, the title to the money paid never passed to the defendant, but remained in the debtor. It is true that the theory upon which property fraudulently assigned is reached by a creditor on adjudication to that effect is, that title has not passed from the assignor, and such is the ground upon which a levy of execution upon assigned property is effectually supported. It may be observed that an assignment being valid between the parties to it is, if fraudulent as against creditors, only voidable by adjudication at their election, or that of some or one of them; and unless an attack is made with a view to such judicial determination, it will be treated as valid, and must be executed accordingly. And when faithfully executed by the assignee without such challenge by any creditor, it is difficult