City Nat. Bank v. Goodrich

• Decision Date: 01 February 1876
• Citation: 3 Colo. 139
• Parties: CITY NATIONAL BANK v. GOODRICH, Assignee.
• Court: Colorado Supreme Court

3 Colo. 139

CITY NATIONAL BANK v. GOODRICH, Assignee.

Supreme Court of Colorado

February, 1876

Appeal from District Court of Arapahoe County.

THE appellee brought an action in trover in the court below against the appellant, claiming to recover as assignee in bankruptcy the value of certain chattels, taken from Baxter &amp Hobson, by the appellant, under circumstances that rendered the taking a fraud within the meaning of sections 35 and 39 of the Bankrupt Act. Baxter & Hobson were, upon their own petition, adjudicated bankrupts, on the 19th day of May 1873.

Up to about the 5th day of May, 1873, Baxter & Hobson had been engaged in carrying on the business of merchant tailoring.

About the 17th day of March, 1873, Baxter & Hobson were indebted to the appellant in the sum of $2,500, which was secured by a chattel mortgage upon their stock of goods. Before the maturity of this indebtedness, and on the 5th of April, 1873 another arrangement was effected between Baxter & Hobson, and the appellant,-the indebtedness was made to mature thirty days thereafter, was increased from $2,500 to $2,700, and was secured by a new chattel mortgage on the stock and fixtures of Baxter & Hobson. The addition of $200 to the indebtedness was made up of $150-the estimated cost of foreclosing the chattel mortgage-and $50 added by way of interest.

At this time, April 5th, 1873, as it appears in evidence, Baxter & Hobson had in their store about $4,000 worth of goods, and accounts on their books in their favor for about $1,200 more, which would make them worth about $5,200, if the book accounts were all good. On the other hand, they were indebted to about the sum of $9,000.

Between April 5th, 1873, and May 17th, 1873, Baxter & Hobson had received from the east, between $2,000 and $3,000 worth of goods, and had sold at least $2,000, from which it appears that relatively the parties stood about the same on the 17th day of May, 1873, as they did on the 5th of April, 1873.

On the 17th day of May, 1873, the appellant took and removed the goods.

The mortgage under which the appellant claimed to, and did, take the goods, covered all the furnishing goods, trimmings, and fixtures of Baxter & Hobson, and permitted Baxter & Hobson to retain the possession and to use and enjoy the goods until default.

The mortgage was given to secure an antecedent indebtedness of Baxter & Hobson to the appellant.

The assignee claimed to recover the value of the goods taken by the bank, for the reason that the bank had obtained a preference prohibited by the Bankrupt Act.

The cause was tried by the court without a jury, and the appellee had judgment for $2,600.

Messrs. SAYRE, WRIGHT & BUTLER, for appellant.

Messrs. FRANCE & ROGERS, for appellee.

A. W. STONE, J.

On the 5th day of April, 1873, Baxter & Hobson, being indebted to appellant in $2,700, executed to it a note for that amount due in thirty days, and a chattel mortgage on one hundred and forty-eight pieces of suitings; sixteen pieces of black doeskin; eight pieces beaver; two...