Crawford v. Maddux

Citations

• 100 Cal. 222
• 34 P. 651
• 1893 Cal. LEXIS 772

Syllabus

<p>Insolvency—Sale op Goods Under Execution—Void Agreement to Prevent Competition.—Where the goods of an insolvent debtor are sold under execution and purchased by the execution creditors for a small sum, under an agreement with the agent o£ other creditors that he would not bid at the sale, in consideration that the execution creditors would pay his principals a larger sum, being the difference between the amount bid and what the execution creditors were willing to pay for the goods under competition, such agreement is against public policy, and wholly void, and could neither be enforced before payment nor remedied by recovery of the money after payment.</p> <p>Id.—Action by Assignee of Insolvent—Money Paid Not Part of Insolvent’s Estate.—The amount paid under such void agreement by the execution creditors did not, because of the wrong, become the property of the execution debtor, his only remedy being to set aside the sale by reason of the fraud; and his assignee in insolvency cannot maintain any action under section 23 of the Insolvent Act of 18S0 to recover double the value of the money so paid, as being property of the debtor embezzled or disposed of with notice of the commencement of the proceedings in insolvency.</p> <p>Id.—Receipt op Money by Petitioning Creditors—Trust. —Where the execution was levied upon the goods before the petition for adjudication of insolvency was filed, and the creditors petitioning for such adjudication were in no way instrumental in procuring the execution sale, and their only connection with it was through the agreement made by their agent, and the receipt of money from the execution purchasers, which was not the money of the insolvent or his creditors, no trust was created in relation thereto in favor of other creditors of the insolvent.</p>