in October 1834, by which deed the Defendant, as one of such creditors, covenanted to pay the Plaintiffs the excess beyond 2s. in the pound, which he might receive from any other parties to certain bills of exchange of which the Defendant was then the holder; and assigned a breach by the receipt on the part of the Defendant of two sums of 1457. and upwards, and 487. and upwards, from certain other parties to two bills of exchange included in the deed of composition; to which declaration the Defendant, amongst other pleas, put in a plea of a release given by George Crook the surety, one of the co-Plaintiffs, since the action was brought. It was stated by affidavits, that J. C. Crook had been insolvent in October 1834, and again in August 1836: that Brown and Bagshaw had been accountants to his estate under both insolvencies; and that, by a deed of June 1338, J. C. Crook had, for the considerations therein stated, assigned to Brown and Bagshaw all the debts contained in a schedule to that deed, of which the debt now sought to be recovered was alleged to be one that this assignment was made with the knowledge and assent of the trustees of J. C. Crook under his second insolvency: that the action was brought for the benefit of Brown and Bagshaw; and that George Crook had by letter authorised the use of his name as joint Plaintiff: on the part of the Defendant it was denied that this debt was included in the schedule of the deed of June 1838, or that the assignment was made with the assent of the trustees; while it was asserted that George Crook allowed the use of his name as Plaintiff on the application of Bagshaw, in ignorance of any assignment to him and Brown, and believing the application to have been made by them as accountants to the estate with a view of receiving the money for the trustees. It was further asserted that, after the deed of October 1834, subsequent dealings took place between J. C. Crook and 1839. CROOK v. STEPHEN. 1839. CROOK บ. STEPHEN. the Defendant in 1834, 1835, and 1836, in the course of which J. C. Crook became largely indebted to the Defendant; that an agreement was entered into between them, that the excess received on the bills whereof Stephen was the holder, should be retained in payment of the new debt, and the residue be retained as a security for liabilities incurred by the Defendant: that, after allowing the whole of the monies and dividends received since the deed of October 1834, J. C. Crook was still indebted to the Defendant in the sum of 6441. Talfourd Serjt., R. V. Richards, and Whitehurst, who shewed cause against the rule, contended that the Court would not interfere, unless it were clearly established that the release was obtained by fraud between the releasor and the Defendant. Herbert and Another v. Pigott. (a) That under the circumstances of this case George Crook was justified in giving the release, the action having been brought in violation of the agreement between J. C. Crook and the Defendant, and without the sanction of the trustees that George Crook's warrant to sue had been obtained by a concealment of the object for which the action was brought; that the Defendant was a creditor of J. C. Crook to a considerable amount; and that the accountants of an insolvent's estate could not legally take an assignment of his debts. Wilde Serjt. and James, in support of the rule, relied on the letter written by George Crook to authorise the action, and argued, that suing as trustee for Brown and Bagshaw, he had no right to decide on the validity of the Defendant's claim to dispute the debt. In Legh v. Legh (b) it was held, that if the obligor of a bond, after notice of its being assigned, take a release from the obligee, and (a) 4 Tyrwh. 285.; 2 Cr. & M. 384. (b) 1 B. & P. 447. plead it to an action brought by the assignee in the name of the obligee, the Court will set the plea aside : and in order to induce a court to set aside a release by one of the assignees of a bankrupt, it was held in Johnson v. Holdsworth (a) sufficient to throw suspicion on the defendant's conduct in the transaction. Cur. adv. vult. TINDAL C. J. (After stating the nature of the proceedings, as antè, p. 688.) The question before us is, whether, upon the several facts stated upon the affidavits which have been produced before us, we should be justified, upon a summary application, in setting aside the plea of release which has been put upon the record by the Defendant. The rule by which courts of law have felt themselves governed in this respect, has been, that wherever it is made clear to the Court on the part of the plaintiff that the release has been obtained by fraud between the releasor and the defendant, in such case, and in such case only, the Court will feel itself warranted, on a summary application, to interfere and set the release aside. This rule is laid down distinctly in the case of Jones and Another v. Herbert (b), in Arton v. Booth (c), Herbert and Another v. Pigott (d), and in other cases. The question therefore is, whether, upon the present occasion, there is such clear evidence of fraud on the part of George Crook, the releasor, and the Defendant, as to require us to interfere. And we think there is not. In the first place, so far as relates to Stephen the Defendant, it is stated in the affidavits, that after the deed of composition of 1834, subsequent dealings in the 1839. CROOK v. STEPHEN. (a) 4 Dowl. 63. (c) 4 B. Moore, 192. 1839. CROOK V. STEPHEN. years 1834, 1835, and 1836, took place between J. C. Crook and the Defendant, in the course of which J. C. Crook became largely indebted to the Defendant; and that an agreement was entered into between them, that the excess received on the bills, whereof Stephen was the holder, should be retained in payment of this new debt, and the residue retained as a security for liabilities incurred by the Defendant; and it is in such affidavit stated, that after allowing the whole of the said monies and dividends received by the Defendant since the first insolvency of J. C. Crook, the said J. C. Crook is still indebted to him, the Defendant, in the sum of 6441. In the next place, this action is not brought for the benefit of the two Plaintiffs, or either of them, but of Brown and Bagshaw, persons who had been employed as accountants to the estate, both before the second insolvency, and also under the said second insolvency of J. C. Crook in August 1836: and it appears by the affidavits, that in June 1838, J. C. Crook, for the considerations therein mentioned, assigned to Brown and Bagshaw all the debts contained in a schedule to that deed. One question of fact raised upon this part of the case is, whether this particular debt now sought to be recovered, was included or not in such schedule and purchase. It is affirmed to have been included on the part of Brown and Bagshaw—it is denied on the part of the Defendant. And again, upon this part of the case, another question is also raised, whether the purchase was made with the knowledge and assent of the four trustees under the second deed of composition, or of some of them only. This also is the subject of affirmation on the one side and denied on the other. And in the course of the argument a still further point has been raised and argued before us, viz. whether persons acting in the character of accountants to an insolvent's estate, can be allowed by a court of equity to become the pur chasers of debts due to the estate of the insolvent, or whether such purchase would not be set aside by such court. And although great stress was laid by Bagshaw and Brown on the letter written by George Crook on the 28th of July, by which he authorised the use of his name as a joint Plaintiff, it is fully met by the affidavit of George Crook, that he did this on the application of Bagshaw, in ignorance of any assignment to him and his partner, and believing the application to have been made by them as accountants to the estate, with a view to recovering the money for the trustees. In a case circumstanced like the present, we cannot see with sufficient clearness and distinctness that this release was obtained by fraud on the part of the Defendant, so as to justify us, on the authority of the decided cases, in interfering summarily and we think it far from clear, on the contrary, that his object might not be to prevent what he thought was a fraud from being committed. We therefore think that the rule must be discharged in the terms in which it is drawn up, that is, with costs. Rule discharged. 1839. CROOK . STEPHEN. |