Armstrong v. Tuttle

• Decision Date: 31 March 1864
• Parties: ROBERT ARMSTRONG, &c., Respondents, v. ELIJAH G. TUTTLE AND HARVEY W. SMITH, GARNISHEES OF WILLIAM RENTH, Appellants.
• Court: Missouri Supreme Court

34 Mo. 432

ROBERT ARMSTRONG, &c., Respondents,

v.ELIJAH G. TUTTLE AND HARVEY W. SMITH, GARNISHEES OF WILLIAM RENTH, Appellants.

Supreme Court of Missouri.

March Term, 1864.

Appeal from St. Louis Circuit Court.

By deed of trust dated April 10th, 1857, duly recorded, William Renth and Catharine his wife conveyed to Harvey W. Smith, as trustee of Elijah G. Tuttle, all the stock in trade, merchandise and fixtures, situated in the store No. 61 Fourth street, in the city of St. Louis, which store was then occupied by said Renth and wife, for carrying on the millinery business; the said stock and merchandise consisting of silk and straw bonnets, ribbons, millinery goods, and trimmings suitable for said business, in trust to secure the payment of four notes, of even date each, for $1368.07, at three, six, nine and twelve months, which said four notes were given in lieu of other notes returned under an agreement to extend the time of payment. Among the conditions of the deed were the following:

“Whereas, for their mutual benefit and the accommodation of said Renth and wife, it is agreed between the parties hereto, that said parties of the first part shall remain in possession of the property hereby conveyed for the purpose, and with the right of using and selling the same in the regular course of their said business, in order to pay said indebtedness out of the proceeds of said business, so long as said business shall be by them carried on in good faith and to the satisfaction of said Tuttle, or until or unless the said business should be interfered with, or the said property or any portions thereof seized or levied upon at the suit, claim or demand of any person other than said Tuttle, or the possession thereof by said parties of the first part be in any manner molested or endangered; in which event, or in case the said parties of the first part shall not conduct said business as aforesaid, it is hereby agreed that said trustee shall be, and he is hereby authorized and empowered as against all other persons, to enter and take possession of said property himself, or by his agent, and the same to dispose of as hereinafter mentioned. Now if the said William Renth, or any person for him, shall well and truly pay and discharge, at or before maturity thereof, respectively, each and every one of the notes above mentioned, with all interest thereon, then this conveyance shall be void, &c. but if the said notes, or either, or any part thereof, or any interest thereon, shall not be fully paid when due to the holder of such note or notes; or if the said parties of the first part, or either of them, shall at any time before all of said notes are fully paid, be sued by, or the said property or any part thereof be levied upon, seized or attached at the suit, claim or demand of any other person; or if said party of the third part shall believe (whether from unusual or forced sales by said parties of the first part, or from any disposal by them of said property or of any part thereof, not in the usual and legitimate course of their said business, as from their failure to perform any understanding entered into between said Renth and wife and said Tuttle for the gradual payment of said notes) that his said debt is or may in any way be endangered, or this security therefor impaired, then and in either of the cases above specified this conveyance shall remain in force, and the said trustee himself, or by his agent thereto appointed by him, may in such case, and at the request of said Tuttle, at any time enter and take possession of the store above mentioned, and of the property hereinbefore conveyed, or any part thereof, and may proceed to sell the same at public or private sale, on the premises or elsewhere, in his discretion, in such manner as to quantity and time of sales, and upon such terms as to cash or credit, and giving such notice by advertisement, if any, as he shall deem for the best interest of all parties concerned,” &c., &c.

A judgment was rendered in the St. Louis Circuit Court on the 22d of April, 1857, in favor of plaintiffs, against William Renth, for $1,297.78, upon which was issued an execution on the same day, and on the 23d of April, 1863, the said appellants were garnished. At the return term of said execution, interrogatories were filed, to which appellants answered. Respondents filed denial of same, to which appellants replied putting in issue whether the said deed of trust was fraudulent and void in law--fraudulent in fact, and the value of the goods conveyed and in possession of appellants under said deed of trust.

The pleadings did not raise the question of off-set or the right of appellants to retain the proceeds arising from the sale of the goods conveyed to the amount of Tuttle's claim. There was evidence tending to show the deed of trust fraudulent in fact. Appellants only claimed the goods and proceeds thereof in virtue of said deed of trust. Renth and wife, after the execution of the deed of trust, continued in possession of the stock of goods, and continued to sell the same in the usual course of business until the 23d of April, 1857, when H. W. Smith, at the direction of Tuttle, demanded and took possession, &c. The court tried the case without a jury, and after hearing the evidence and granting instructions, found for plaintiffs the sum of $7,132.50, and that William Renth owed respondents $1,511.58, for which sum judgment was rendered against appellants in favor of respondents. Appellants filed a motion for a new trial, which being overruled, they appealed.

The following instructions were given at the instance of plaintiffs:

1. Plaintiffs ask the court to declare the law to be that the deed of trust, a copy of which is in evidence, is absolutely void upon its face, as a matter of law, as against the plaintiffs, if they were creditors of Renth at the time of the execution of said deed.

2. If said Smith, pretending to act as trustee under said deed of trust, at the instance and request of Tuttle took possession of the stock of goods (mentioned in said deed) belonging to said Renth, and under the direction of said Tuttle sold the same; and if at the time of the execution of said deed, and if at the time of the taking of said goods, and the sale thereof, the plaintiffs were creditors of said Renth; and if at the time said Tuttle and Smith were summoned as garnishees herein, they had in their possession the stock of goods or the proceeds thereof; or if said Smith had the possession of said goods, or the proceeds thereof, under the direction of Tuttle, at the time he and Tuttle were summoned as garnishees herein, then the said Tuttle and Smith are both liable to the plaintiffs in this proceeding for the reasonable value of said goods, or the proceeds thereof, not exceeding the amount of plaintiffs' claim against said Renth.

3. If the deed of trust, a copy of which is in evidence, is absolutely void on its face as a matter of law as against the plaintiffs, then neither the said Smith nor Tuttle had any right or color of right as against plaintiffs to interfere with the stock of goods mentioned in said deed; and if said Smith at the instance of Tuttle, and his agent, and for his benefit, took possession of said goods under pretence of right under deed of trust, and sold a part of said goods at the store of Renth at the instance of Tuttle, and paid the proceeds over to Tuttle, and moved the balance of the goods to Tuttle's store, and sold a part of said balance at the store of Tuttle at his instance, and paid the proceeds over to Tuttle, and a remaining portion of said goods were sold at auction at the instance of Tuttle, and the proceeds of such remaining balance were paid over to Tuttle, and while the said goods or the proceeds thereof were in the possession of said Smith or Tuttle, as above stated, they were summoned as garnishees, herein, then plaintiffs are entitled to recover against them the value of the goods so taken and sold, not exceeding the amount of their claims against Renth; in such case it makes no difference whether Tuttle was a bona fide creditor of Renth or not, nor whether Tuttle credited the proceeds of said goods to the payment of his debt due by Renth or not.

To the giving of said instructions the defendants duly excepted.

The following instruction was given at the instance of the garnishees:

1. The court sitting as a jury declares the law to be, that the statements in the answer of the garnishees in this cause are evidence in their favor, and are presumed to be true until the contrary is made to appear by the plaintiffs.

The following instructions were asked by defendants and refused, to which they duly excepted:

2. That it is a question of fact for the jury to decide upon all the evidence before them whether the deed of trust made by Renth and wife to Tuttle's trustee, was made and intended to be for the use of said grantors; and if the jury believe that the said deed was not so made and intended, they will find for the garnishees.

3. That the deed of trust in evidence from Renth and wife to Smith in trust for Tuttle, is not in itself fraudulent in law, nor is it void by its terms.

4. That unless the jury believe from the whole evidence in the case that the deed of trust from Renth and wife to Smith was in fact made with a fraudulent intent, and that the trustee Smith had knowledge of and assented to such fraudulent intent, they will find for the garnishees.

5. That it is incumbent on the plaintiffs in order to avoid the deed of trust in question, to prove to the satisfaction of the jury, that the same was made with a fraudulent intent in fact on the part of said grantors, and that such fraudulent intent was known and assented to by Smith the trustee; and that although said deed, if in fact made for the use of said Renth, or if made with the fraudulent intent to hinder or delay other creditors of said Renth, would thereby be made void if the trustee knew of and assented to such...