Code-Co's Internet Access to Utah Law: http://www.code-co.com
[Utah Code Table of Contents]
[TITLE 6. Table of Contents]
6-1-1 Insolvent debtor may assign.
An insolvent debtor may, in good faith, execute an assignment
of property to one or more assignees in trust for the benefit
of creditors in conformity with the provisions of this title.
1953
6-1-2 When assignment void.
An assignment for the benefit of creditors is void against any creditor of the assignor not assenting thereto in the following cases:
(1) if it gives a preference dependent upon any condition or contingency, or with any power of revocation reserved;
(2) if it tends to coerce any creditor to release or compromise his demand;
(3) if it provides for the payment of any claim known by the assignor to be false or fraudulent, or for the payment of more upon any claim than is known to be justly due from the assignor;
(4) if it reserves any interest in the assigned property or in any part thereof to the assignor or for his benefit before all his existing debts are paid; and
(5) if it confers upon the assignee any power which, if
exercised, might prevent or delay the immediate conversion
of the assigned property to the purposes of the trust; provided,
that the assignment may provide reasonable terms and manner
of sale to be carried out only so far as practicable and
not prejudicial to the interest of the estate in the discretion
of the court.
1953
6-1-3 Assignment to be written - Contents - Recording.
Every such assignment shall be by an instrument in writing,
setting forth the name of the assignor, his residence and
business, the name of the assignee and his residence and
business, and in a general way describing the property assigned
with its location, and stating the purpose of the assignment.
It shall be executed and acknowledged in the manner prescribed
for the execution and acknowledgment of deeds, and recorded
in the office of the recorder of the county where the property
assigned is located. The assignor shall annex to such instrument
an inventory, under oath, of his estate, real and personal,
according to the best of his knowledge, and a list of his
creditors and the amount of their respective demands; but
such inventory shall not be conclusive as to the amount of
the debtor's estate, and such assignment shall vest in the
assignee the title to any other property belonging to the
debtor at the time of making the assignment, except property
exempt from execution and insurance upon the life of the
assignor, unless the instrument mentions such exempt property
and insurance and declares an intention of the assignor that
they shall pass thereby. As soon as such instrument is recorded
it shall be filed, with the inventory and list of creditors,
in the office of the clerk of the district court of the county
in which the property so assigned is located; as shall all
subsequent papers connected with such proceedings.
1953
6-1-4 Inventory - Bond.
The assignee shall forthwith file with the clerk of the
district court of the county where the property assigned
is located a true and full inventory and valuation of said
estate, under oath, so far as the same has come to his knowledge,
and shall then enter into bonds to the state for the use
of the creditors in double the amount of the inventory and
valuation, with one or more sureties to be approved by said
clerk, for the faithful performance of said trust; and the
assignee may thereupon proceed to perform any duty necessary
to carry into effect the purpose of said assignment.
1953
6-1-5 Notice of assignment.
The assignee shall forthwith give notice of such assignment
by publication in some newspaper published in the county,
or, if none, in a newspaper having general circulation therein,
which notice shall be published at least once a week for
six weeks; and shall forthwith send a notice by mail to each
creditor of whom he shall be informed, directed to his usual
place of residence, requiring such creditor to present to
him within three months thereafter his claims under oath.
1953
6-1-6 Claims to be filed.
The claims of all creditors, clearly and distinctly stated
and sworn to by the claimant, or by some person acquainted
with the facts, shall be filed with the assignee within three
months of the date of the first publication provided for
in the preceding section, unless the court extends such time
for all or some of such claimants, which it may do in its
discretion where peculiar circumstances seem to justify such
extension, but in no case shall such extension be extended
beyond nine months.
1953
6-1-7 Assignee to make report.
At the expiration of three months from the time of first
publishing notice the assignee shall report and file with
the clerk of the court a true and full list, under oath,
of all such creditors of the assignor as shall have claimed
to be such, with a statement of their claims, an affidavit
of publication of notice, and a list of the creditors with
their places of residence to whom notice has been sent by
mail, and the date of mailing the same.
1953
6-1-8 Objections to claims - Hearing.
Any person interested may appear within one month after
such report is filed and contest the claim or demand of any
creditor by written exceptions thereto filed with the clerk,
who shall forthwith cause notice thereof to be given to the
creditor, which shall be served as in case of a summons and
returnable at a time to be named therein, not less than ten
nor more than forty days; at which time the court shall proceed
to hear the proofs and allegations of the parties in the
matter and render such judgment thereon as shall be just.
1953
6-1-9 Taxes must be paid.
In all assignments of property for the benefit of creditors,
assessments and taxes levied thereon either under the laws
of the state or ordinances of municipal corporations shall
be entitled to priority, and paid in full by the assignee,
and claims therefor need not be filed with him.
1953
6-1-10 Dividends to creditors.
If no exception is made and filed to the claim of any
creditor, or if the same has been adjudicated, the court
shall order the assignee to make from time to time fair and
equal dividends among the creditors of the assets in his
hands in proportion to their claims and according to the
preferences or classes, if any, named in the assignment,
and as soon as may be to render a final account of his trust
to the court. If upon making the final dividend to creditors
the assignee shall be unable after reasonable efforts to
ascertain the place of residence of any creditor or the person
who is authorized to receive the dividend due any creditor,
he shall report the same to the court, with evidence showing
diligent attempts to find such creditor or person authorized
to receive the dividend; whereupon the court may in its discretion
order the distribution of the unclaimed dividend among the
other creditors.
1953
6-1-11 Court to supervise administration.
The assignee shall at all times be subject to the order
and supervision of the court or judge and from time to time
may be compelled, by citation or attachment, to file reports
of his proceedings and of the situation and condition of
the trust, and to proceed in the execution of the duties
required by this title.
1953
6-1-12 Time for disposing of property.
The assignee shall dispose of all personal property and
divide the proceeds of the same among the creditors as they
may be entitled thereto within six months from the date of
the assignment, unless further time is given for good cause
by the court, and shall dispose of real estate within one
year from such date, and make full settlement by that time,
unless the court or judge, for good reason shown, shall extend
the time therefor.
1953
6-1-13 Failure to file inventory - Examination of debtor.
No assignment shall be declared fraudulent or void for
want of any list or inventory as provided in this title.
The court or judge may, upon application of the assignee
or any creditor, compel the appearance in person of the debtor
before such court or judge, forthwith or at the next term,
to answer under oath such matters as may be inquired of him,
and such debtor may be fully examined under oath as to the
amount and situation of his estate, and the names of the
creditors and amounts due to each with their places of residence,
and may be compelled to deliver to the assignee any property
or estate embraced in the assignment.
1953
6-1-14 Subsequent inventory - Additional bond.
The assignee shall from time to time file with the clerk
of the court an inventory and valuation of any additional
property which may come into his hands under the assignment
after the filing of the first inventory, and the clerk or
the judge of the court may thereupon require him to give
additional security.
1953
6-1-15 Debts not matured - Delay in filing claims.
Any creditor may claim debts to become due as well as
debts due, but on debts not due a reasonable rebate shall
be made when the same are not drawing interest. Creditors
who shall not file their claims within three months from
the publication of notice as aforesaid shall not participate
in dividends until after payment in full of all claims presented
within said time and allowed by the court, unless the court
has extended the time for filing such claims.
1953
6-1-16 Sales - Confirmation.
The assignee may dispose of and sell all the estate assigned,
real and personal, which the debtor had at the time of the
assignment, may sue for and recover in his own name everything
belonging or appertaining to said estate, and generally do
whatever the debtor might have done in the premises; but
no sale of real estate belonging to said trust shall be made
without notice published as in case of sales of real estate
on execution, unless the court or judge shall otherwise order,
and no such sales shall be valid until approved by the court
or judge.
1953
6-1-17 Removal of assignee.
Upon a written application of a majority of the creditors
in amount the court shall remove the assignee and appoint
in his stead a person approved by the creditors in the same
number and amount, and the person so removed shall immediately
turn over to the clerk of the court, or any person appointed
by the court, all money and property of the estate in his
hands.
1953
6-1-18 Death or neglect of assignee.
If an assignee dies before the closing of his trust, or
shall fail or neglect for the period of twenty days after
making of any assignment to file an inventory and valuation
and give bond as required in this title, the district court
or any judge thereof of the county where such assignment
may be recorded, on the application of any person interested,
shall appoint some person to execute the trust, who shall
on giving bond have all the powers of the assignee first
appointed and be subject to all the duties hereby imposed.
If it is shown to the court at any time that an assignee
is guilty of wasting or misapplying the trust fund, he may
be removed, and a successor appointed in the same manner.
1953
6-1-19 Compensation of assignee.
In the absence of any provision in the assignment to the
contrary an assignee for the benefit of creditors is entitled
to the same commissions as are allowed by law to executors
and administrators as compensation in full for all services.
1953
6-1-20 Right to prefer creditor.
Nothing in this title contained shall affect the power
of a person, although insolvent, residing either within or
without this state, to transfer property in this state in
good faith to a particular creditor for the purpose of paying
or securing the whole or a part of a debt owing to such creditor;
provided, that joint, or joint and several, debtors can prefer
their joint creditors only out of joint property, and can
prefer the individual creditors of each only out of the separate
property of each.
1953
