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February 1827, when they were antedated; that before the execution of any of the indentures by any of the parties thereto, viz. on the 9th of November 1826, and another Samuel Churchill left his dwelling-house, and absconded out of the county of Oxford, in order to avoid his creditors.

The bill further stated, that Samuel Churchill had committed an act of bankruptcy by breaking an appointment to meet his creditors.

Under these circumstances, the plaintiffs, as assignees, contended that the indentures of the 18th of July were void, and an act of bankruptcy, and that they were entitled to all the estate and interest of Samuel Churchill in the estate comprized in the indentures, together with divers conveyances which the trustees had executed in pursuance of such deed to the different defendants.

Mr. Bickersteth, Mr. Pemberton, and many other gentlemen (eighteen in number), for the different defendants, contended,

1st, That the indentures of 17th and 18th of July 1826 were not an act of bankruptcy.

2dly, If they were, that the parties had not notice, and the commission did not issue till more than two months after the execution of the deed.

3dly, If the parties had notice, it could not be invalidated under the commission, which did not issue till more than two months after the execution of the deed.

1st, The deed is not an act of bankruptcy.

It is merely a conveyance by Churchill of part of his property, for the purpose of converting realty into personalty, in order to meet present exigencies, which, it has been settled, by Berney v. Davidson, 1 Brod. & Bing. 409, and 4 Moore, 126, and Berney v. Viner, 4 Moore,

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and another

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323, is not an act of bankruptcy; and, so far from being injurious to creditors, it is only doing what the execution creditors had themselves power to do.

2dly, If it is an act of bankruptcy, the parties had not notice, as the indentures are an assignment only of part of the property; and the commission did not issue until the 26th of March 1827, which being more than two months from the execution of the indentures, they are protected by 6 Geo. 4. c. 16. s. 81. (a)

If it is to be contended that notice of the existence of the deed implies notice of the intent of the deed, the answer is contained in Read v. Ward, 7 Vin. 122, by which the contrary is decided.

3dly, If it is an act of bankruptcy, and the parties had notice, it cannot be invalidated under this com

(a)" And be it enacted, that all conveyances by, and all contracts and other dealings and transactions by and with any bankrupt, bonú fide made and entered into more than two calendar months before the date and issuing of the commission against him, and all executions and attachments against the lands and tenements or goods and chattels of such bankrupt, bona fide executed or levied more than two calendar months before the issuing of such commission, shall be valid, notwithstanding any prior act of bankruptcy by him committed; provided the person or persons so dealing with such bankrupt, or at whose suit or on whose account such execution or attachment shall have issued,

had not at the time of such conveyance, contract, dealing, or transaction, or at the time of executing or levying such execution or attachment, notice of any prior act of bankruptcy by him committed: Provided also, that where a commission has been superseded, if any other commission shall issue against any person or persons comprised in such first commission, within two calendar months next after it shall have been superseded, no such conveyance, contract, deal. ing, or transaction, execution or attachment, shall be valid, unless made, entered into, executed, or levied more than two calendar months before the issuing the first commission."

mission, which did not issue till more than two months after the execution of the deed. Jackson v. Barrow, 3 Carr. & P. 87.

Mr. Tinney, Mr. Swanston, and Mr. Montagu for the assignees :

1st, The deed is an act of bankruptcy. Any deed with an intent to prefer a creditor is, upon the principle of equal distribution, upon the principle of the equity of equality, an act of bankruptcy. The only difficulty consists in discovering the intent. When the preference is obvious, as in an assignment by a trader of the whole of his property, or of so much as will incapacitate him from trading, there is no difficulty. The Court infers the intent from the act. It says men must intend the obvious consequences of their actions.

The doctrine is the same, for the principle is the same, when only part is assigned, although the difficulty, from the intent not being obvious, is increased.

It is necessary, therefore, to resort to extrinsic circumstances, as, whether the trader was solvent or insolvent; whether the execution was secret or public; whether possession was or was not delivered; whether it was voluntary or from pressure; with all the various acts to which reference may be made when endeavouring to discover the secret motive by which the trader was influenced. The cases in support of this doctrine are numerous, and of great authority,Worsley v. Demattos, 1 Burr. 467; Linton v. Bartlet, 3 Wils. 47. This short case explains the whole principle of the law. It is as follows:

A trader, being insolvent, in consideration of a loan of 1201., assigns one third part of all his effects to the lender, who is his brother, and within two days after the making the deed the trader absconds, and is declared a bankrupt.

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Per Curiam:- Although this may be a hard case upon the brother, who is a bond fide creditor, yet the and another giving him the preference is a fraud upon all the laws concerning bankrupts, which proceed upon equality, and say that all the creditors shall come in pari passu. There is no case where ever such a preference as this was allowed. The same spirit of equality ought to warm the courts of justice which warmed the legislature when they made the bankrupt laws; and if we should let this deed stand, we should tear up the whole bankrupt laws by the roots; it is a bill of sale made by a trader at a time when he was insolvent, and plainly had an act of bankruptcy in contemplation; it is partial, and unjust to all the other creditors.

Judgment for the plaintiff that the deed is void.

The doctrine in Linton and Bartlet is thus recognized by Lord Mansfield in Harman v. Fisher, Cowper, 117. He says, "The case of Linton and Bartlet has determined that, though the act be complete, yet, if the mere and sole motive of the trader was to give a preference, it shall be void, and, if by deed, is in itself an act of bankruptcy. In that case the goods assigned were not more than one third of his effects; upon what then was the opinion of the Court founded? Not upon an assignment of one third, being the same as an assignment of all his effects, but upon the ground that the trader gave a preference, and upon his sole motive being to do so. If he can give it to one, he can give it to another, which would establish this principle, that a bankrupt may apportion his estate amongst his different creditors as he thinks proper."

The same principle is recognized by Lord Ellenborough in Newton v. Chantler, 7 East, 143, where his Lordship says, in words which may be used in the present case, "The trader was in insolvent circumstances, and known

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to himself to be so at the time. Now the execution of such a bill of sale, under these circumstances, has in all the cases been considered primá facie, at least, as fraudu- and another lent; and it is incumbent on the party who sets it up to show something to rebut that presumption. As a general and others. proposition, it cannot be disputed that a conveyance by deed by a trader of all his property to a particular creditor, in prejudice to the rest, is an act of bankruptcy. Every man must be taken to contemplate the ordinary consequences of his own act at the time of the act done. Here the necessary effect of this act was to turn round all his other creditors, and prevent them from pursuing their present ordinary remedy against him for the payment of their demands, leaving them only to look to him for the future surplus, if any. With respect to the supposition, that, according to the doctrine of Berney and Davidson, this is not an act of bankruptcy, as it merely converts realty into personalty for the benefit of the creditors, it is a misapplication of the authority of Berney v. Davidson to the present case, in which the facts are wholly different. That there may be cases in which a trader may convert realty into personalty for the purpose of discharging debts may be readily admitted, and it will not be denied that it is equally true, that there may be cases where such conversion may be an act of bankruptcy; ex parte Meyer, 1 Mont. 292. Berney v. Davidson was a case of the first class, but it was never supposed to be an authority for such conversion in all cases. It was not so argued, recognized, or decided. The cases are Berney and Davidson, A. D. 1829, 1 Bro. & Bing 409, 4 Moore, 126; Berney and Viner, 1820, 4 Moore, 322.

The case, as reported in 4 Moore, shows the principle upon which it was decided, and a moment's consideration of that principle will show how inapplicable Berney v.