Dayton Spice-Mills Co. v. Sloan

• Decision Date: 18 November 1896
• Citation: 49 Neb. 622,68 N.W. 1040
• Parties: DAYTON SPICE-MILLS CO. v. SLOAN ET AL.
• Court: Nebraska Supreme Court

49 Neb. 622

68 N.W. 1040

DAYTON SPICE-MILLS CO.

v.SLOAN ET AL.

Supreme Court of Nebraska.

Nov. 18, 1896.

Syllabus by the Court.

1. The action of the trial court in denying an application for the continuance of the hearing on a motion to dissolve an attachment examined, and affirmed.

2. A question which apparently was not presented to the trial court, but is raised for the first time in this court, need not be considered. Dunham v. Courtnay, 39 N. W. 784, 24 Neb. 627.

3. “The disproportion, if one exists, between the value of chattels mortgaged and the amount thereby secured, affords no basis for a presumption of law. It is a matter of evidence, to be accorded such weight as, in the light of surrounding circumstances, it is entitled to receive in the determination of a question of fact.” Banking Co. v. Costello, 63 N. W. 376, 45 Neb. 119.

4. A gift of chattels from the husband to the wife, during coverture, inter vivos, could not be made, and was of none effect at common law. The husband and wife were considered as but one person, and she was incompetent to receive the gift.

5. “The common law in respect to the rights of husband and wife is in force in this state, except so far as it has been modified by statute.” Aultman v. Obermeyer, 6 Neb. 260.

6. The married woman's act being for the purpose of extending, and not contracting or limiting, the rights of married women in this state, will not be held to have abrogated the equitable rule which upheld gifts from husbands to wives, made when the husband was solvent, and which did not impair the existing rights of creditors.

7. “A husband may lawfully give his wife a deed or mortgage to secure a pre-existing bona fide debt owing to her, and such conveyance is not fraudulent as to his other creditors if taken in good faith, and without any fraudulent purpose.” Ward v. Parlin, 46 N. W. 529, 30 Neb. 376.

8. The statute of limitations will not run in favor of strangers to a transaction against a claim due from a husband to his wife arising out of such transaction.

9. A plaintiff who has attached property as the property of defendant, and obtained writs of garnishment to issue on allegations that the garnishee named has in his possession property, etc., owned by or belonging to the defendants, will not be heard to assert that defendants have not sufficient interest to be allowed to defend against the attachments.

10. The dissolution of an attachment issued on a claim before due terminates the action; and that a judge at chambers, after dissolving such an attachment, made an order of dismissal of the main action, if without jurisdiction and error (which we do not decide), was not prejudicial.

11. The evidence examined, and held sufficient to support the finding and order of the lower court.

Error to district court, Douglas county; Scott, Judge.

Action by the Dayton Spice-Mills Company against William G. Sloan and Jonas P. Johnson. From a judgment dismissing the action, plaintiff brings error. Affirmed.

Horton & Blackburn, for plaintiff in error.

Breckenridge & Breckenridge, for defendants in error.

HARRISON, J.

This action was commenced by plaintiffs in the district court of Douglas county against the defendants on a claim not due. They also filed an affidavit setting forth the statutory grounds authorizing the issuance of an attachment in such action. A writ of attachment was ordered, and was issued and served. Motion to dissolve the attachment was presented, and, on hearing, sustained. The attachment was dissolved, and the cause dismissed. The plaintiffs have prosecuted error proceedings to this court.

At the time of the hearing of the motion to dissolve the attachment, or immediately prior thereto, the plaintiff filed an application for a continuance of such hearing, supported by affidavit. The application was denied, and this action is made the subject of one of the assignments of error. The main tendency of the evidence which it was asserted might be produced if a continuance was granted would have been to prove that the defendants had fraudulently contracted the debt in suit, and it would have been incompetent in the present proceeding, this being an action instituted upon a claim before it was due. Caulfield v. Bittenger, 37 Neb. 542, 56 N. W. 302. An examination of the record convinces us that there was no error in the refusal to grant a continuance of which the plaintiff has any just complaint.

It is urged that the statements of the affidavit in attachment were not sufficiently traversed or denied. Whether this was true or not, the question does not appear to have been raised on the hearing in the trial court, and hence will not be considered here. Dunham v. Courtnay, 24 Neb. 627, 39 N. W. 784.

The defendants had given, at or about the time of the attachment, certain mortgages to some of their creditors, as security for the payment of their indebtedness to such creditors, which it is claimed was excessive security, and furnished, as a matter of law, ground for sustaining the attachment. The prevailing doctrine of this court on the subject of excessive security is as follows: “The disproportion, if one exists, between the value of chattels mortgaged and the amount thereby secured, affords no basis for a presumption of law. It is a matter of evidence, to be accorded such weight as, in the light of surrounding circumstances, it is entitled to receive in the determination of a question of fact.” Banking Co. v. Costello, 45 Neb. 119, 63 N. W. 376. If the evidence had established that excessive security had been given,--a point as to which it was conflicting,--it would have been but evidence to be considered with the other facts and circumstances bearing on the question of fraud, as a matter of fact. It appears from the evidence that the defendants, on June 21, 1893, and during a number of years prior thereto, were conducting a wholesale grocery business in the city of Omaha, as partners under the firm name of Sloan, Johnson & Co. On the date mentioned the firm was heavily indebted to various creditors, and as security for the payment of existing liabilities executed and delivered to the First National Bank of Omaha a chattel mortgage, the amount which it was given to secure being stated therein as $49,576.60; also a similar instrument in favor of the Colorado National Bank of Denver, in the stated sum of $30,000; the property included in the two mortgages being all the stock of merchandise belonging to the firm. On the same date there was also assigned to the second of the banks named book accounts of the firm amounting to the sum of $15,000, and subsequently more of the book accounts were assigned and parceled out or delivered to others of the firm's creditors. On the same date that the said chattel mortgages were executed to the banks, one member of the firm--William S. Sloan--executed and delivered to his wife, Ruth Anna Sloan, a mortgage on his residence property, to secure a stated indebtedness in the sum of $6,432.81, and the other member of the firm--Jonas P. Johnson--gave his wife, Ella G. Johnson, a mortgage on his residence property in the sum of $9,861.31. It appears that the property mortgaged to Mrs. Sloan was worth, or valued then, at about $15,000, and Mr. Johnson's residence at about $14,000. It appears that some years prior to the time that the firm embarked in business in Omaha, William G. Sloan had two endowment policies of insurance on his life, which matured and were paid, one May 20, 1886, and the other June 1, 1889. The amount received in payment of the two policies was, in the aggregate, $3,087.46. These sums were paid to Mrs. Sloan on the dates we have mentioned, and immediately given to Mr. Sloan, who executed and delivered to his wife promissory notes payable to her in sums corresponding to the cash received by him. It was testified that Mrs. Sloan had received from some relatives $1,000, which she had loaned to Mr. Sloan. None of the principal or interest of the notes given by Mr. Sloan to his wife had ever been paid, and the whole amount claimed to be due for both principal and interest was the consideration stated in the mortgage given by Mr. Sloan to his wife. It further appeared that Mr. Johnson had an endowment policy of insurance on his life, payable to himself, which was, when paid at its maturity, paid, at his request, to his wife, kept by her until the next day, when it was by her turned over to him, and he gave his wife a promissory note in a like amount, signed by himself and William G. Sloan. None of the principal or interest had ever been paid, and their aggregate amount constituted the consideration stated in the mortgage to Mrs. Johnson of date June 1, 1893. All the premiums on the policy of William G. Sloan had been paid by the assured, and the premiums on Johnson's had been paid by him. These transactions between the husbands and wives were gifts, or attempted transfers of the money to them as gifts, and subsequent and immediate loans thereof to the donors, the husbands. The husbands, at the dates of the several occurrences, were solvent, and amply able to make the presents to their wives. It appears that one was then estimated to be worth $40,000 and the other $80,000.

One question which arises is, could the husbands make gifts of money or personal property to the wives, and it become the separate property of the wives, and not subject to the disposal of the husbands, or liable for their debts? This is not a direct proceeding to annul the gifts from the husbands to the wives, but the validity of the gifts is drawn into question in the determination of the good faith or fraudulent character of the mortgages from the husbands to the wives to secure the payment of the debts, which, if they existed, were created when the husbands gave to the wives the money derived from the life insurance policies, and received it from them again as loans, which were then evidenced by promissory notes. Some of the...