Credit Service Co. v. Peters

• Decision Date: 29 September 1925
• Citation: 115 Or. 633,239 P. 810
• Parties: CREDIT SERVICE CO. v. PETERS (SABIN, GARNISHEE.
• Court: Oregon Supreme Court

239 P. 810

115 Or. 633

CREDIT SERVICE CO. v. PETERS (SABIN, GARNISHEE.

Supreme Court of Oregon

September 29, 1925

Department 1.

Appeal from Circuit Court, Multnomah County; W. N. Gatens, Judge.

Action by the Credit Service Company against F. F. Peters, wherein R. L. Sabin was garnished. From a judgment for garnishee plaintiff appeals. Affirmed.

See also, 216 P. 742.

William B. Layton, of Portland (N. Ray Alber, of Portland, on the brief), for appellant.

Sidney Teiser, of Portland (W. G. Keller, of Portland, on the brief), for respondent.

BURNETT J.

It appears from the record that, in the action of the plaintiff against defendant Peters, a writ of attachment was issued and the same was served upon R. L. Sabin, attaching in his hands all property of the defendant. Answering the writ in the first instance, Sabin said, in substance, that he had nothing in his hands belonging to the defendant. The substance of the contention for the plaintiff under the allegations filed against Sabin is that about July 30, 1919, the defendant Peters, sold a stock of merchandise in bulk to one Neuishin and that afterwards the latter assigned his interest in the stock of merchandise to Sabin. Concerning the sale from Peters to Neuishin, the allegation is as follows:

"* * * That said sale was in violation of chapter 281 of the Session Laws of the state of Oregon for 1913, in that no certificate under oath was made by the vendor respecting his creditors, and that no notice to the creditors of the vendor was made or given by the vendor or vendee at least five days before the consummation of such bargain or purchase, and at least five days before paying or delivering to the vendor any part of the purchase price or consideration therefor, as provided in said Session Laws."

This averment is denied by Sabin's answer. The proceeding originated in the district court in Multnomah county, and Sabin took an appeal from an adverse judgment there to the circuit court, where, on a trial without the intervention of a jury, the following findings of fact were made and filed.

"That the sale, as set forth in plaintiff's complaint, was a sale in bulk of all of the goods, wares and merchandise, appliances, stock, equipment and fixtures of said defendant, F. F. Peters, but that said sale was not in violation of chapter 281 of the Session Laws of the state of Oregon for 1913.

"That subsequent to the sale by defendant, F. F. Peters, to one Sam Neuishin, as set forth in said complaint, said Sam Neuishin assigned his right, title and interest in and to said stock of goods, wares and merchandise, equipment, fixtures and appliances to R. L. Sabin, garnishee herein.

"That there is no evidence to show that the parties on whose behalf plaintiff brought this action were creditors of said F. F. Peters when said sale in bulk was made as aforesaid."

From these findings, the court deduced a conclusion of law resulting in a judgment in favor of Sabin, from which the plaintiff has appealed.

Garnishment proceedings in the stage, presented by the present record, are in the nature of an ancillary action against the garnishee to recover from him a debt or property owing or belonging to the principal defendant. Keene v. Smith, 44 Or. 525, 75 P. 1065; Overturff v. Carroll, 109 Or. 326, 219 P. 1081.

The allegations, so called in section 315, Oregon Laws constitute a complaint by the plaintiff against the garnishee, and are subject to the same objections as if they were a complaint in an original action. The plaintiff is before us claiming under section 8161, Oregon Laws, whereby it is made the duty of the buyer of a stock of merchandise and fixtures, at least five days before paying or delivering to the vendor any part of the purchase price, to demand and receive from the vendor a written statement, under oath, containing the names and addresses of all the creditors of the vendor, together with the amount of indebtedness by him owing to each and all of them, or in the alternative, if there are no such creditors, a written statement, under oath, to that effect, and it is made the duty of the vendor to furnish such statement. The effect of a failure to observe these conditions of the section just noted is prescribed in section 8162, Oregon Laws, to be that "such purchase, sale or tranfer shall as to any and all creditors of the vendor, be conclusively presumed to be fraudulent and void." On the theory that the transfer by Peters was thus void, the plaintiff deduces the conclusion that Neuishin had no title which he could impart to Sabin in the same property, with the result that the property in the hands of the latter is in very truth the property of...