was made with the intent, bona fide, to make an equal distribution of
the proceeds of the trust estate among creditors, in conformity with the
local statute. The Supreme Court of New York ruled that the statute
of New Jersey was, in its nature and effect, a bankrupt law, and the
power conferred upon Congress to establish a uniform system of bank-
'ruptcy, having been exercised by the passage of the act of 1867, the
latter act wholly suspended the operation of the local statute as to all
cases within its purview; consequently, it was held, the assignment
was not valid for any purpose. The Court of Appeals, recognizing the
paramount nature of the Bankrupt Act of Congress, and assuming that
the 14th section of the New Jersey statute, relating to the effect upon
the claims of creditors who exhibit their demands for a dividend, was
inconsistent with that act, and therefore inoperative, adjudged that
other portions of the local statute providing for the equal distribution
of the debtor's property among his creditors, and regulating the general
conduct of the assignee, were not inconsistent with nor were they
necessarily suspended by the act of 1867: further, that the New Jersey
statute did not create the right to make voluntary assignments for the
equal benefit of creditors, but was only restrictive of a previously
existing right, and imposed, for the benefit of creditors, salutary safe-
guards around its exercise; consequently, had the whole of the New
Jersey statute been superseded, the right of a debtor to make a
voluntary assignment would still have existed. The assignment, as a
transfer of the debtor's property, was, therefore, upheld as in harmony
with the general object and purposes of the Bankrupt Act, unassailable
by reason merely of the fact that some of the provisions of the local
statute may have been suspended by the act of 1867.

In the view which we take of the case it is unnecessary to consider
all of the questions covered by the opinion of the State court and
discussed here by counsel. Especially it is not necessary to determine
whether the Bankrupt Act of 1867 suspended or superseded all of the
provisions of the New Jersey statute. Undoubtedly the local statute
was, from the date of the passage of the Bankrupt Act, inoperative in
so far as it provided for the discharge of the debtor from future liability
to creditors who came in under the assignment and claimed to partici-
pate in the distribution of the proceeds of the assigned property. It is
equally clear, we think, that the assignment by Locke of his entire
1 by Locke
property to be disposed of as prescribed by the statute of New Jersey,
and therefore independently of the bankruptcy court, constituted, itself,
an act of bankruptcy, for which, upon the petition of a creditor filed in
proper time, Locke could have been adjudged a bankrupt, and the
property wrested from his assignees for administration in the bank-
ruptcy court. In re Burt, 1 Dillon, 439, 440; In re Goldschmidt,
3 Bank. Reg. 164; In matter of Seymour T. Smith, 4 Bank. Reg. 377.
The claim of Pickhardt and Kutroff existed at the time of the assign-
ment. The way was therefore, open for them, by timely action, to
secure the control and management of the assigned property by that

court for the equal benefit of all the creditors of Locke. But they elected to lie by until after the expiration of the time within which the assignment could be attacked under the provisions of the Bankrupt Act; and now seek, by this suit in the name of the plaintiff in error, to secure an advantage or preference over all others; this, notwith standing the assignment was made without any intent to hinder, delay, or defraud creditors. In order to obtain that advantage or preference, the plaintiff in error relies on the paramount force of the Bankrupt Act, the primary object of which, as this court has frequently announced, was to secure equality among the creditors of a bankrupt. Mayer v. Hellman, 91 U. S. 496-501; Reed v. McIntyre, 98 U. S. 507-509; Buchanan v. Smith, 16 Wall. 277. It can hardly be that the court is obliged to lend its aid to those who, neglecting or refusing to avail themselves of the provisions of the act of Congress, seek to accomplish ends inconsistent with that equality among creditors which those provisions were designed to secure. If it be assumed, for the purposes of this case, that the statute of New Jersey was, as to each and all of its provisions, suspended when the Bankrupt Act of 1867 was passed, it does not follow that the assignment by Locke was ineffectual for every purpose. Certainly, that instrument was sufficient to pass the title from Locke to his assignees. It was good as between them, at least until Locke, in some appropriate mode, or by some proper proceedings, manifested a right to have it set aside or cancelled upon the ground of a mutual mistake in supposing that the local statute of 1846 was operative. And in the absence of proceedings in the bankruptcy court impeaching the assignment, and so long as Locke did not object, the assignees had authority to sell the property and distribute the proceeds among all the creditors, disregarding so much of the deed of assignment as required the assignees, in the distribution of the proceeds, to conform to the local statute. The assignment was not void as between the debtor and the assignees simply because it provided for the distribution of the proceeds of the property in pursuance of a statute, none of the provisions of which, it is claimed, were then in force. Had this suit been framed for the purpose of compelling the assignees to account to all the creditors for the proceeds of the sale of the property committed to their hands, without discrimination against those who did not recognize the assignment and exhibit their demands within the time and mode prescribed by the New Jersey statute, a wholly different question would have been presented for determination. It has been framed mainly upon the idea that by reason of the mistake of Locke and his assignees in supposing that the property could be administered under the provisions of the local statute of 1846, even while the Bankrupt Act was in force, the title did not pass for the benefit of creditors according to their respective legal rights. In this view, as has been indicated, we do not concur.

We are of opinion that, except as against proceedings instituted under the Bankrupt Act for the purpose of securing the administration

of the property in the bankruptcy court, the assignment, having been made without intent to hinder, delay, or defraud creditors, was valid, for at least the purpose of securing an equal distribution of the estate among all the creditors of Locke, in proportion to their several demands, Reed v. McIntire, 98 U. S. 507-509; and, consequently, we adjudge only that the plaintiff in error is not entitled, by reason of any conflict between the local statute and the Bankrupt Act of 1877, or by force of the before-mentioned judgment and the proceedings thereunder, to the possession of the assigned property or of its proceeds, as against the assignees, or to a priority of claim for the benefit of Pickhardt and Kutroff upon such proceeds. The judgment is affirmed.

MR. JUSTICE MATTHEWS (with whom concurred MILLER, GRAY, and BLATCHFORD, JJ.), dissenting.

MR. JUSTICE MILLER, MR. JUSTICE GRAY, MR. JUSTICE BLATCHFORD, and myself, are unable to agree with the opinion and judgment of the court in this case. The grounds of our dissent may be very generally and concisely stated as follows:

The New Jersey statute of April 16, 1846, the validity and effect of which are in question, is an insolvent or bankrupt law, which provides for the administration of the assets of debtors who make assignments of all their assets to trustees for creditors, and for their discharge from liabilities to creditors sharing in the distribution. It was accordingly in conflict with the National Bankrupt Act of 1867 when the latter took effect, and from that time became suspended and without force until the repeal of the act of Congress. It is conceded that the 14th section, which provides for the discharge of the debtor, is void by reason of this conflict, and, in our opinion, this carries with it the entire statute. For the statute is an entirety, and, to take away the distinctive feature contained in the 14th section, destroys the system. It is not an independent provision, but an inseparable part of the scheme contained in the law.

as

This being so, the assignment in the present case must be regarded and void as to creditors. For it was made in view of this statute and to be administered under it. Such is the express recital of the instrument and the finding of the fact by the court. It is as if the provisions of the act had been embodied in it and it had declared expressly that it was executed with the proviso that no distribution should be made of any part of the debtor's estate to any creditor except upon condition of the release of the unpaid portion of his claim.

It is not possible, we think, to treat the assignment as though the law of the State in view of which it was made, and subject to the provisions of which it was intended to operate, had never existed, or had been repealed before its execution. Because there is no reason to believe that, in that state of the case, the debtor would have made an assignment on such terms. To do so is to construct for him a contract which he did not make and which there is no evidence that he intended

to make. It must be regarded, then, as a proceeding under the statute of New Jersey, and as such, with that statute, made void, as to creditors, by the National Bankrupt Act of 1867. Otherwise that uniform rule as to bankruptcies, which it was the policy of the Constitution and of the act of Congress pursuant to it, to provide, would be defeated. No title under it, therefore, could pass to the defendants in error, and the judgment creditors who acquired a lien upon the fund in their hands were by law entitled to appropriate it, as the property of their debtor, to the payment of their claims.

For these reasons we are of opinion that the judgment of the Court of Appeals of New York should be reversed.1

1 Assignments made in accordance both with State laws and the principles of common law were upheld in Hawkins's Appeal, 34 Conn. 548; Maltbie v. Hotchkiss, 38 Conn. 80; Geery's Appeal, 43 Conn. 289, 298; Cook v. Rogers, 31 Mich. 391; Thrasher v. Bentley, 59 N. Y. 649; Beck v. Parker, 65 Pa. 262; Patty-Joiner Co. v. Cummins, 93 Tex. 598; Binder v. McDonald, 106 Wis. 332. In the case last cited a provision of the State law dissolving attachments prior to an assignment was held to be still in force.

Assignments which derived their validity and efficacy from a State insolvent law were held void in Shryock v. Bashore, 13 B. R. 481; Ketcham v. McNamara, 72 Conn. 709; Rowe v. Page, 51 N. H. 190.

Before the decision in Boese v. King it was held by some courts that a general assignment for the benefit of creditors was not an act of bankruptcy or opposed to the policy of the National Act. Such courts, therefore, held such an assignment effectual even though a petition in bankruptcy was filed within six months. Sedgwick v. Place, 1 B. R. 204; Haas v. O'Brien, 66 N. Y. 597; Von Hein v. Elkus, 8 Hun, 516. But the great weight of authority was otherwise. Under the present act a general assignment is uniformly held to be made voidable if not void by a seasonable petition. See post, ch. iv. sec. iii.

CIRCUIT COURT OF APPEALS, SEVENTH CIRCUIT, NOVEMBER 22, 1900.

[Reported in 104 Federal Reporter, 964.]

BEFORE WOODS and GROSSCUP, Circuit Judges, and SEAMAN, District Judge.

SEAMAN, District Judge. The alleged bankrupt, Emily Plotke, appeals from an order of the District Court whereby she is adjudicated a bankrupt upon a creditors' petition filed May 3, 1899. The petition states that " Emily Plotke has for the greater portion of six months next preceding the date of filing this petition had her principal place of business and her domicile at Chicago," in said district, and 66 Owes debts to the amount of $1,000 and over"; that she is insolvent, and within four months next preceding "committed an act of bankruptcy," and on January 3, 1899, made "a general assignment for the benefit of her creditors to one John Poppowitz," which was duly filed and recorded. The subpoena issued thereupon was returned by the marshal as served within the district on Emily Plotke, " by leav ing a true copy thereof at her usual place of abode, with Charles Plotke, an adult person, who is a member of the family." On May 29, 1899, the appellant filed a verified plea, which reads as follows: "And the said Emily Plotke, especially limiting her appearance for the purposes of this plea, in her own proper person comes and defends against the foregoing proceeding, and says that she has not had her domicile within the territorial limits and jurisdiction of this court for the six months next preceding the filing of the petition herein, to wit, six months next preceding May 3, A. D. 1899, nor has she had her domicile within the territorial limits of the jurisdiction of this court as aforesaid during any part of said period of six months, nor has she now her domicile therein, nor has she had her principal place of business within the territorial limits and jurisdiction of this court for the greater part of the six months next preceding the filing of the