Ackerman v. Ackerman

• Decision Date: 16 December 1896
• Parties: ACKERMAN ET AL. v. ACKERMAN ET AL.
• Court: Nebraska Supreme Court

50 Neb. 54

69 N.W. 388

ACKERMAN ET AL.

v.ACKERMAN ET AL.

Supreme Court of Nebraska.

Dec. 16, 1896.

Syllabus by the Court.

1. Even though a sheriff, in possession of personal property for its safe-keeping pending an application for a receiver, is to be deemed to be a receiver, a proposition not determined, the levy of an attachment on a portion of such property without leave of the court is not void, in the absence of any objection by the sheriff, as custodian, or by the receiver, on that ground.

2. Where the evidence showed affirmatively that a chattel mortgage was withheld from record more than a month, in pursuance of an agreement so to continue to withhold it unless some change or difficulty should occur in the business affairs of the mortgagor which would make it necessary to protect the interest of the mortgagee, and the mortgagor was to notify the mortgagee of any financial difficulty the mortgagor might meet with, upon which notification the mortgage was to be filed, held to sufficiently establish a fraudulent purpose of both parties to the mortgage such as to render it invalid and void as to creditors of the mortgagor.

3. A decree required a receiver to sell the assets of an insolvent firm on a day named. The receiver, without other authority, advertised and sold such assets after the date fixed by the decree. Held, that such sale was absolutely void, and not merely irregular, in such a sense that a confirmation over objections could render it valid.

Appeal from district court, Douglas county; Scott, Judge.

Action by E. C. Ackerman and another against G. A. Ackerman. The George R. Dickinson Paper Company and the Carpenter Paper Company intervened, claiming the goods in suit under attachments. From the judgment rendered, interveners appeal. Reversed.

L. D. Holmes and B. G. Burbank, for appellants.

Breckenridge & Breckenridge, Cavanagh, Thomas & McGilton, Duffie, Crane & Van Dusen, Horton & Blackburn, Schomp & Corson, Isaac E. Congdon, J. M. Woolworth, and Rich, O'Neill & Sears, for appellees.

RYAN, C.

On the 10th day of August, 1893, E. C. Ackerman and A. M. Heintze began this action against G. A. Ackerman in the district court of Douglas county. These plaintiffs alleged that in 1887 they, with the defendant, had entered into partnership for the purpose of conducting a general printing, engraving, and lithographing business in the city of Omaha; that the defendant was the financial manager for the firm; that its business had been, until about January 1, 1893, conducted profitably, but that thereafter, as shown by its books, its operations were at a great loss,--as plaintiffs alleged, of $1,000 per month. For the purpose of accounting for this condition of affairs, it was further alleged that the defendant had injudiciously purchased supplies and machinery, and had appropriated to his own use $6,000 of the assets of the firm without the knowledge of either plaintiff; that, upon the discovery by the plaintiffs, on January 1, 1893, of this misappropriation, the defendant had promised to make restitution to the firm, but had wholly failed to perform this promise; and that at the time of filing the petition he was insolvent, and was refusing upon demand to make an accounting of the affairs of the aforesaid firm. It was therefore charged by plaintiffs that the firm was at the time of the commencement of this action unable to meet its obligations, and was insolvent; that its indebtedness was a large amount, as to which plaintiffs had no means of knowledge, but charged the fact to be that it was at least $45,000; and that the assets were reasonably of the value of $65,000, but that, if they were sold at a sacrifice, these assets would be wholly inadequate to the payment of the aforesaid indebtedness. The eleventh paragraph and the prayer of the petition, which followed immediately thereafter, was as follows: “(11) Plaintiffs further show that, unless the property of said co-partnership is preserved intact and saved, great loss will ensue to the co-partners and their creditors, and the assets of said firm sacrificed. Plaintiffs therefore pray that an accounting may be ordered between the parties to this action, and the said firm dissolved, and that a receiver be appointed by the court to take charge of all the property of said firm, and collect the debts due to the said firm, and hold the said property and assets and money collected subject to the further order of the court; and plaintiffs further pray that, pending the application for a receiver herein, the sheriff of Douglas county be ordered to take charge of all the assets and business of said firm of Ackerman Bros. & Heintze, and hold the same intact, subject to the further order of the court, and for such further relief as equity and good conscience demand.” Contemporaneously with the filing of this petition where was filed a motion for the appointment of a receiver who was to take charge of “all the property and assets of the firm of Ackerman Bros. & Heintze upon the grounds set forth in the petition.” Afterwards, on the 10th day of August, 1893, Hon. A. N. Ferguson, one of the judges of the said district court, on the presentation of the petition and motion at chambers, ordered that the hearing of the application for a receiver be had on the 17th day of August, 1893, and that, pending such application for a receiver, George A. Bennett, sheriff of Douglas county, take possession of all the partnership property of Ackerman Bros. & Heintze, situated at 1116 and 1118 Howard street, Omaha, and hold them subject to the further order of the court. Pursuant to the terms of this order the sheriff at once took possession. Later still, on the same day, the Carpenter Paper Company commenced its action in the aforesaid court against the firm of Ackerman Bros. & Heintze for the recovery of judgment of the sum of $3,421.83. A portion of this had not matured at this time, and accordingly there was the necessary showing made for an attachment in such case, as well as with respect to the amount which was then past due; and there was thereupon, at chambers, made the following order: “Upon reading the petition of the plaintiff herein and the affidavit in attachment of the plaintiff herein, and it appearing to the court that the plaintiff's claims are just, it is ordered by the court that an attachment be granted in this case against the defendant for the sum of five thousand dollars ($5,000.00) upon the execution by the plaintiff of an undertaking in attachment on the part of the plaintiff to the defendant as required by law. Aug. 10th, 1893. A. N. Ferguson, Judge.”

Immediately after the issue of the writ of attachment, and on the day of its allowance, the sheriff, then being in possession of the entire establishment of the firm of Ackerman Bros. & Heintze, as already indicated, levied said writ on a portion of its personal property. Afterwards, on December 9, 1893, in due order, there was a judgment by default in favor of the Carpenter Paper Company as prayed, and in satisfaction thereof the attached property was ordered sold. On November 22, 1893, the Carpenter Paper Company filed its petition of intervention in this action, whereby it described the nature of the debt owing it by the firm of Ackerman Bros. & Heintze, and detailed the proceedings had up to that time for the collection of said indebtedness. The prayer of the Carpenter Paper Company's petition of intervention was that its attachment lien might be enforced in this case, and declared a lien paramount to all other liens against the property which was then in the hands of a receiver, who on August 23, 1893, had been appointed, and accordingly had succeeded to the possession of the sheriff. In this petition of intervention it was shown, and it is not questioned, that the order appointing the receiver, on August 23, 1893, was expressly conditioned that the delivery of personal property by the sheriff to the receiver was without prejudice to the lien of said intervener, and that said intervener's lien was in no way impaired by the delivery of the property taken under the aforesaid attachment proceedings. We learn, from the record, that the receiver was authorized to operate the plant of Ackerman Bros. & Heintze for a period of about five months, that this was done at a loss, and that in this unsuccessful attempt there was manufactured and sold the greater part of the property upon which the attachment had been levied in the suit of the Carpenter Paper Company against Ackerman Bros. & Heintze. As this property was raw material, which by the receiver, under direction of the court, was manufactured and sold for the benefit of the estate of the insolvent firm, and as the other personal property attached had been appropriated to the payment of the debts of the firm of Ackerman Bros. & Heintze, the Carpenter Paper Company is entitled to be paid as a preferred creditor, if its attachment was valid and effective. After the Carpenter Paper Company had procured its attachment to be levied by the sheriff, there were other attachment suits begun, and like levies were procured to be made. There were several interventions in this action predicated on these attachments, and other interventions for the purpose of having recognized and enforced the liens created by chattel mortgages executed by the firm of Ackerman Bros. & Heintze. An extended description could subserve no useful purpose, and of necessity would cause confusion. They will therefore be unmentioned, except where a different course is required by the exceptional relations to this action of some of the parties concerned. On the final hearing no claim for a lien was recognized, but all creditors of the firm of Ackerman Bros. & Heintze,...