Charles Henry James and Others, Assignees of John Gillespie, A Bankrupt v Patrick Magennis

• Jurisdiction: Ireland
• Judgment Date: 27 January 1870
• Date: 27 January 1870
• Court: Court of Exchequer Chamber (Ireland)

Exch. Cham.

Before WHITESIDE, C. J. MONAHAN, C. J., O'BRIEN, FITZGERALD, GEORGE, MORRIS, AND LAWSON, JJ.

CHARLES HENRY JAMES AND OTHERS, ASSIGNEES OF JOHN GILLESPIE, A BANKRUPT

and

PATRICK MAGENNIS.

Billiter v. YoungENRENR 6 E. & B. 1; in Ex. Ch. 8 H. L. C. 682.

Woodhouse v. MurrayELR L. R. 2 Q. B. 634.

Orr v. DevinUNK 9 Ir. C. L. R. 100.

Skelly v. KeeffeUNK 17 Ir. C. L. 232.

Orr v. DevinUNK 9 Ir. C. L. R. 100.

Assignees of Skelly v. KeefeUNK 17 Ir. C. L. R. 232.

Morris v. MellinENR 6 B. & C. 446.

Davis v. EytonENR 7 Bing. 154.

Bryan v. ChildENR 5 Exch. 368.

Brook v. MitchellENR 6 Bing. N. C. 349.

Billiter v. Young 6 Ell. & Bl. 15; 8 H. of L. Cas. 682.

Orr v. DevinUNK 9 Ir. C. L. R. 100.

Assignees of Skelly v. KeefeUNK 17 Ir. C. L. R. 100.

Assigness of Skelly v. KeefeUNK 17 Ir. C. L. R. 247.

Byran v. ChildENR 5 Exch. 368.

Morris v. MellinENR 6 B. & C. 450.

Orr v. DevinUNK 9 Ir. C. L. R. 100.

Young v. BillitrENR 8 H. L. C. 682.

Bryan v. ChildENR 5 Exch. 368.

Skelly v. KeeffeUNK 17 Ir. C. L. R. 266.

Young v. BilliterENR 8 H. L. C. 692.

Orr v. DevinUNK 9 Ir. C. L. R. 100.

Skelly v. KeeffeUNK 17 Ir. C. L. R. 233.

Bryan v. ChildENR 5 Exch. 376.

Billiter v. YoungENR 6 E. & B. 14.

Marks v. FeldmanELR L. R. 4 Q. B. 481.

Warrant of Attorney within two months before Bankruptcy Seizure and Sale of Chattel real by Sheriff before Bankruptcy.

Von. V.] COMMON LAW SERIES. 253 (IN THE EXCHEQUER CHAMBER) (1). Exch. Chant. 1869. CHARLES HENRY JAMES AND OTHERS, ASSIGNEES OF Nov. 11, 12. JOHN GILLESPIE, A BANKRUPT, v. PATRICK MAGEN Irish Bankrupt Act, 1857- Warrant of Attorney within two months before Bankruptcy-Seizure and Sale of Chattel real by Sheriff before BankÂÂruptcy. A trader, at a time when he was unable to meet his engagements, and within two months before his bankruptcy, executed, bond,fide to secure an antecedent debt, a bond and warrant of attorney to confess judgment, upon which judgment was entered and execution issued, under which the sheriff, before the bankruptcy, seized, sold, and conveyed to the Defendant, a Chattel real of the cognizor : Held, affirming the decision of the Court of Exchequer (dim. MONAHAN, C. J., and FITZGERALD and LAwsoN, JJ.), that the assignees of the bankrupt were not entitled, in an ejectment on the title, to recover from the Defendant the possession of the chattel real so seized, sold, and conveyed to him by the sheriff. EJECTMENT ON THE TITLE by the assignees of a bankrupt; ver dict for the Defendant. APPEAL by the Plaintiffs from an order of the Court of ExÂÂchequer discharging a conditional order to enter the verdict for the Plaintiffs. The facts, the course of the trial, the arguments and cases cited, are fully set out in the report of the case in the Court below. (I. R. 3 C. L. 100). 111`Causland, Q. C., and Holmes, for the Plaintiff. Butt, Q. C., and Colquehoun, for the Defendants, cited, in addition to the cases cited in the Court below, Billiter v. Young (2), and Woodhouse v. Murray (3). (1) Before WHITESIDE, C. J., MOÂÂNAHAN, C. J., O'BRIEN, FITZGERALD, GEORGE, MORRIS, and LAwsoN, J. (2) 6 E. & B. 1; in Ex. Ch. 8 H. L. C. 682. (3) L. R. 2 Q. B. 634. THE IRISH REPORTS. [I. R. LAWSON, J. :- This is an appeal from a decision of the Court of Exchequer. The action was one of ejectment on the title, brought by the assignees of John Gillespie, a bankrupt, to recover possession of certain lands of which Gillespie was yearly tenant. On the 24th of December, 1867, Samuel Gordon, a creditor of Gillespie, obÂÂtained from him a bond and warrant of attorney to confess judgÂÂment for 123, the amount of an antecedent debt. Gordon enÂÂtered judgment, issued a fi. fa., under which the Sheriff sold GilÂÂlespie's interest in the lands on the 8th of January, 1868, and the Defendant, Patrick Magennis, became the purchaser. On the 19th of February, 1868, a petition in bankruptcy was filed against Gillespie ; the Plaintiffs were appointed assignees, and brought the ejectment to recover the lands so sold. The case went down to trial, and the jury found that Gillespie was unable to meet his engageÂÂments upon the 24th of December, 1867. The Plaintiff's counsel contended that by the provisions of the Irish Bankrupt and InsolÂÂvent Act, 1857, the warrant of attorney was null and void, and that, consequently, the judgment, execution, and sale were void; that nothing passed. to the purchaser, and that, consequently, they were entitled to recover the lands. The Court of Exchequer decided against the Plaintiffs, and the verdict is entered for the Defendant. The 333rd section of 20 & 21 Viet. c. 60, in substance enacts, that every warrant of attorney given by a bankrupt within two months of the filing of a petition of bankruptcy, if given in respect of an antecedent debt, the bankrupt being unable to meet his enÂÂgagements at the time he gives the warrant, shall be deemed and taken to be null and void, whether given by the bankrupt in conÂÂtemplation of bankruptcy or not. The present case, therefore, falls within the terms of that secÂÂtion ; the warrant was given within two months of the filing of the petition, by a person unable to meet his engagements, and in order to secure an antecedent debt. If, therefore, the warrant of attorney is made null and void by this section, and if no valid judgment can be founded upon a void warrant of attorney, then, as a purchaser at a sheriff's sale obtains no title if the judgment is void, it would seem that the Plaintiffs VOL. V.] COMMON LAW SERIES. 255 ought to be entitled to recover, unless there be something in the Exch. Chain. Act to protect purchasers who buy under executions levied before 1870. bankruptcy. ASSIGNEES I Now, the 328th section of the Act provides that all executions OF GLLESPIEv. against the lands of any bankrupt bond fide executed by seizure, litAGENNis. and all executions against the goods and chattels of a bankrupt bond fide executed and levied by seizure and sale, before the filing of the petition, are to be deemed valid if the creditor have no notice of a prior act of bankruptcy ; and it is provided that nothing therein is to give validity to any execution founded on a judgment on a warrant of attorney given by way of voluntary or fraudulent preference. And the 330th section provides that nothing therein contained shall be deemed to give validity to any warrant of attorney deÂÂclared to be null and void ; nor to give validity to any judgment entered up under or by virtue of any such warrant of attorney. These two sections; read with the 333rd section, seem to me to show very clearly that the Legislature intended that a judgment entered by virtue of a warrant of attorney declared to be null and void, shall be itself null and void, that protection is withheld from executions issued upon such judgments, and that all proceedings on foot of them are wholly inoperative to pass any property or confer any right. Therefore, in the absence of authority, and reÂÂgarding only the clear words and manifest intention of the Statute, I should hold without any hesitation that the warrant of attorney was void, that the judgment and execution were void also, and that there was nothing to divert the title out of Gillespie, and that it vested in his assignees. The Legislature says it shall be null and void ; why are we to read that as voidable ? When the words " void as against the assignees" are used, it is held to mean that it shall not be void to all intents and purposes, but only against certain persons ; and the words, therefore, receive the construction that they are voidable by the assignees, and not void ab initio. The Legislature here plainly intended that if a person unable to meet his engagements preferred a particular creditor by giving him this kind of security for an antecedent debt, that for a period of two months that creditor should not be able to avail himself of that security by capturing the property of the bankrupt, and that if the THEIRISH REPORTS. [I, R. language. How stands the case then upon authorities ? There is no exÂÂpress authority upon this point in England upon any corresponding section ; but in this country the Court of Common Pleas, upon a demurrer, decided this very point in the case of Orr v. Devin (1). The case of Billiter v. Young shows very clearly the distinction beÂÂtween the provision making a thing fraudulent and void against assignees and simpliciter declaring it void; and it seems to me to be clearly deducible from that case that if the words null and void had been used there as here, the decision would have been the other way. Counsel there, arguing for the Defendant in error that the transaction was void, says :-" The object of the Legislature was, that the property of the insolvent should be equally distriÂÂbuted amongst his creditors, and that anything done to defeat that object should be void. The mischief to be guarded against was that of the debtor making away with his property to some favoured creditor ; to prevent that mischief the strongest words were used." The LORD CHANCELLOR : " No ; they might have been wholly unqualified, but they are not ; the transfer is not declared to be absolutely void, but void as against the assignees." Now, here the same mischief is to be guarded against, and words wholly unqualified are used. I cannot, therefore, but think that if the words here used were the words in the clause adjudiÂÂcated upon in Billiter v. Young, the House of Lords would not have thought the right of the Plaintiffs to recover open to any serious doubt. It is said, however, that the case of Orr v. Devin has been overÂÂruled by the case of Assignees of Skelly v. Seeffe (2). That was a decision upon a different section of the Statute. Orr v. Devin was cited in it without any disapprobation being expressed. Two of the Judges in the Court of Queen's Bench, Judge Hayes, at page 253 of the report, and Judge O'Brien, at page 254, comment upon (1) 9 Ir. C. L. R...