Butler v. Sanger

• Decision Date: 18 October 1893
• Citation: 23 S.W. 487
• Parties: BUTLER et al. v. SANGER.
• Court: Texas Court of Appeals

23 S.W. 487

BUTLER et al. v. SANGER.

Court of Civil Appeals of Texas.

October 18, 1893.

Appeal from district court, McLennan county; A. C. Prendergast, Special Judge.

Trial of right of property between Philip Sanger, claimant, and Butler, Clapp, Wentz & Co. and Teft, Weller & Co., attachment creditors. There was a judgment for the claimant, and the attachment creditors appeal. Affirmed.

The other facts fully appear in the following statement by FISHER, C. J.:

A. S. Haber was a retail merchant on the 15th day of May, 1889. Being at the time insolvent, and indebted to appellants, he executed a conveyance of all his property subject to execution, consisting of a stock of merchandise at Waco, and all his store fixtures, safe, and furniture, notes and accounts, choses in action, etc., to Sam Sanger, trustee, for the benefit of certain preferred creditors other than appellants. Among other preferred claims was one for $250, alleged to be due the law firm of Alexander, Winter & Campbell, for their services in preparing said conveyance and in advising the trustee as to his powers and duties in the administration of the fund. The preferred debts aggregated about $10,000. Some days afterwards the trustee sold at private sale, to Philip Sanger, one of the preferred creditors, the entire stock of merchandise for the sum of $8,500 cash, and he went into possession. Appellants sued out and levied attachments aggregating in amount $3,901.21 on said stock. Philip Sanger claimed the stock, and gave bond, waived inventory, and this suit is a trial of the right of property under the statute. The goods were valued at $3,500 by the officer. Issues were submitted and joined. Appellants sought to impeach said conveyance, and, among other grounds, alleged fraud, and an intent to hinder and delay appellants; that it was made voluntarily, without request or consideration; and that many of the preferred claims, including that of Philip Sanger, were fictitious, and that the debt of Alexander, Winter & Campbell was not a proper charge against the trust fund, and was void. The case was tried before the court, who found on all the issues for appellee, filed his conclusions of law and facts, and rendered judgment for appellee, to which appellants excepted and gave notice of appeal.

We find the following facts: (1) A. S. Haber was a retail merchant, and on the 15th day of May, 1889, he was practically insolvent. On that day he executed and delivered a deed of trust to Sam Sanger, as trustee, conveying all his stock of merchandise, accounts, notes, and store fixtures, which embraced all of his property, in trust for the benefit of certain preferred creditors named, as follows: Philip Sanger, $3,000; Mrs. Jeanette Haber, $2,200; Waco State Bank, $650; B. Frelich & Co., $343.50; Slayden-Kirksey Woolen Mills, $48; Sam Sanger, $925; Sanger Bros., Dallas, $870; Sanger Bros., Waco, $970.16; John T. Walton, $930; Alexander, Winter & Campbell, $250. The aggregate amount of such preferred debts is $10,286.66. The instrument also provided for the payment of the interest due on these debts. The instrument provides that Sam Sanger, trustee, shall take possession of said property for the use and benefit of the preferred creditors, and shall proceed to take an invoice of said property, and, without unnecessary delay, sell the said property at public or private sale for cash, either by wholesale or retail, and that he shall proceed with due diligence to collect the notes and accounts. (2) All the debts secured by the deed of trust were legal and valid debts against Haber at the time of the execution of said instrument. The debt of Alexander, Winter & Campbell was a reasonable attorney's fee for services in drawing and preparing the trust deed so executed by Haber, and for services and advice to the trustee in regard to the proper execution of the trust. The debts to Philip and Sam Sanger arose out of the fact that they were sureties on the paper of Haber for the amount stated. They had not paid the debts when the deed of trust was executed, and the debts at that time were not due. In this connection we also find that Haber, at the time of the exetion of the deed of trust, had no other property than the goods conveyed, and that the proceeds of the sale of the goods by the trustee were applied to the payment of these debts, and that at said time the Sangers were solvent, and responsible for the debts upon which they were sureties. We also find that the amount of the debt to Alexander, Winter & Campbell was reasonable for the services rendered. The only consideration for the execution of the deed of trust was to secure the payment of the debts mentioned, and that in the execution thereof Haber's purpose was not to defraud his other creditors, but was simply in good faith to secure the claims of the preferred creditors. (3) May 24, 1889, for the sum of $8,500, the trustee sold the goods and property described in the deed of trust to Philip Sanger; the trustee at the time being in possession of said goods under said deed of trust. Prior to the sale to Philip Sanger, the trustee sold about $300 worth of the goods. The goods sold for a fair price, and the proceeds thereof were paid on the secured debts. (4) The amount of debts secured and preferred by the deed of trust was about $10,286, with interest; and we find that the value of the goods and property transferred by the deed of trust did not exceed in value more than about $9,000. (5) We find that Philip Sanger, by virtue of his purchase of the property, acquired a good title, superior to any claim of the appellants. (6) The appellants were creditors of Haber at the time the deed of trust was executed, and their claims were legal and valid debts against him, and upon which they have obtained judgments; and, at their instance, during the pendency of their suits against him, writs of attachments were issued, and, after the purchase of the goods by Philip Sanger at the trustee's sale, were levied upon the property conveyed by the deed of trust.

Robertson & Davis and Stanley, Spoonts & Meek, for appellants. Alexander & Campbell, for appellee.

FISHER, C. J., (after stating the facts.)

Appellants' first assignment of error is too general to require us to consider it, but we can say that we think the finding of the court below as to the validity of the deed of trust is supported by the facts. Our findings of fact dispose of this assignment.

In reply to the second assignment of error,—if the appellants are serious in urging it,—we clearly think that the deed of trust is supported by a consideration. A debtor may in good faith voluntarily prefer some of his creditors; and when he executes a deed of trust looking to that end, transferring his property for such purpose, and the trustee and the beneficiaries act upon the instrument, and accept its benefits, this, between the parties, constitutes a contract resting upon mutual promises that may result in a benefit and advantage to one...