Sweet v. Lang
Decision Date | 14 August 1926 |
Docket Number | No. 7206,7207.,7206 |
Citation | 14 F.2d 762 |
Parties | SWEET v. LANG et al. SAME v. NORTHWESTERN MUT. LIFE INS. CO. et al. |
Court | U.S. Court of Appeals — Eighth Circuit |
H. V. Mercer, of Minneapolis, Minn. (E. J. Lien, of Minneapolis, Minn., on the brief), for plaintiff in error and appellant.
Claude Krause, of Minneapolis, Minn. (J. O. P. Wheelwright, of Minneapolis, Minn., on the brief), for defendants in error except Pure Oil Co. and Horace M. Libby, and for appellee Northwestern Life Ins. Co.
William W. Bartlett, Marshall Bartlett, and George E. Dyer, all of Minneapolis, Minn., for defendant in error Pure Oil Co.
Frank W. Booth, of Minneapolis, Minn., for defendant in error Horace M. Libby.
M. H. Boutelle and Le Roy Bowen, both of Minneapolis, Minn., for Alvin H. Poehler, Eugenia L. Poehler, and Henry Poehler.
Before LEWIS, Circuit Judge, and FARIS and PHILLIPS, District Judges.
These cases were argued and submitted together. The first numbered cause is at law, the second in equity. They rest in large part on the same facts. We will dispose of them seriatim.
On October 7, 1921, the District Court appointed plaintiff in error receiver of H. Poehler Company, a Minnesota corporation. The appointment was made in a judgment creditor's suit. Thereafter the receiver brought a large number of actions against merchants, tradesmen, professional men, and others, charging in each case that Alvin H. Poehler, president of the corporation, had wrongfully and without authority paid off his personal indebtedness to each defendant by giving the corporation's check or checks, that each defendant knew the facts and should be held to have received the moneys of the corporation for its use and benefit, and is thus liable to the receiver as for money had and received. None of the complaints allege that the corporation was insolvent when the payments were made.
The answers allege that for many years prior to the appointment of the receiver it had been the custom and practice of Alvin H. Poehler to pay his personal indebtedness with checks of the corporation, that this was done at all times with the express knowledge and consent of the corporation and of all of its officers, directors, and stockholders, and that all its directors and stockholders ratified, consented to, and acquiesced in the payments. The answers further allege that all payments were made and received in good faith and at times when the corporation was solvent.
There being some forty actions of the kind noted, they were by order of court on motion of the receiver's counsel consolidated; and on motion of several defendants, which was unopposed, the court appointed Charles B. Elliott, an experienced and learned member of the bar, as auditor (Ex parte Peterson, 253 U. S. 300, 40 S. Ct. 543, 64 L. Ed. 919), "to make a preliminary investigation as to the facts; to hear the witnesses; report on the issues of fact involved in the pleadings herein, setting out his conclusion as to the facts involved that are not disputed, and make and file a report in the office of the clerk of this court with a view to simplifying the issues for the jury; but not finally to determine any of the issues in the action, the final determination of all issues of fact to be made by the jury on the trial; that such auditor shall have power to compel the attendance of and administer oaths to witnesses; that said auditor is hereby instructed to report upon the issues of fact and separate those items of fact which are in dispute from those as to which there is no real dispute and also to report therewith a transcript of the evidence on which the specific claims are rested; that said auditor is hereby directed to form a judgment and express an opinion upon such of the facts as he finds to be in dispute, but said report of said auditor shall be prima facie evidence only of the facts which he reports, that he is hereby specifically authorized:
"(1) To compel an examination of the books and accounts of the H. Poehler Company and of the personal account of Alvin H. Poehler with said company and the evidence of all parties bearing upon the issues in the pleadings herein."
After hearing much testimony, which the auditor certified with his report, he therefrom found:
The parties then stipulated that trial by jury be waived, and that the consolidated cause be submitted to the court upon the transcript of evidence reported by the auditor. Counsel for plaintiffs filed objections to the auditor's findings, and moved that his report be not approved, but the court, on consideration of the proof, made findings of fact, the same in substance as found by the auditor, including a finding that the corporation was solvent during the entire period of...
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