Frank v. Stearns
| Citation | 195 N.W. 949,111 Neb. 101 |
| Decision Date | 16 November 1923 |
| Docket Number | No. 22511.,22511. |
| Parties | FRANK v. STEARNS ET AL. |
| Court | Nebraska Supreme Court |
OPINION TEXT STARTS HERE
Syllabus by the Court.
A petition filed by the trustee in bankruptcy of W., seeking to obtain a judgment against S. for wrongfully converting a part of W.'s estate, alleged that W. had been adjudged a bankrupt; that plaintiff was the duly appointed and qualified trustee; that, at the time W. sold the property to S., W. was insolvent; and that S. knew that W. was insolvent; and that the sale was in violation of the Bulk Sales Law of the state. Held, that the allegations of the petition were sufficient to state a cause of action, and were not vulnerable to an attack upon the ground that it was not alleged that the assets in the hands of the trustee were not sufficient to pay the debts.
Where a petition is filed which states a cause of action before the statute of limitations has run, and thereafter, after the period of the statute of limitations, an amended petition is filed, amplifying the facts but alleging the same cause of action, the amended petition is not vulnerable to a plea that the cause of action is barred by the statute of limitations.
Where plaintiff in a replevin action, in addition to his claim for a return of the property, seeks to recover damages against the defendant for a conversion of a part of the property before the suit was brought, the court may rightly treat the allegations for damages for conversion as surplusage, and the judgment of the court adjudging the rights of the parties to the goods sought to be replevied is not an adjudication of the claim for damages for the conversion.
Evidence examined, and held not sufficient to support the judgment rendered.
The rule announced in Depriest v. McKinstry, 38 Neb. 194, 56 N. W. 806, and in Singer Sewing Machine Co. v. Robertson, 87 Neb. 542, 127 N. W. 866, 34 L. R. A. (N. S.) 887, distinguished.
Additional Syllabus by Editorial Staff.
Replevin is primarily an action for possession, and must be brought against one having the control or custody of the property.
“Insolvency,” as the term is ordinarily used, is not a mere failure to pay debts, but means an insufficient amount of property to pay.
Appeal from District Court, Morrill County; Hobart, Judge.
Action by Pearl Frank, trustee of Noah E. Workman, bankrupt, against Frank E. Stearns and another. From a judgment for plaintiff, defendant Stearns appeals. Reversed and remanded.
Mothersead & York, of Scottsbluff, for appellant Stearns.
C. G. Perry, of Bridgeport, and Halligan, Beatty & Halligan, of North Platte, for appellee Frank.
Heard before MORRISSEY, C. J., LETTON, DEAN, DAY, and GOOD, JJ., and REDICK and SHEPHERD, District Judges.
Claiborne G. Perry, as trustee in bankruptcy of Noah E. Workman, brought this action against Frank E. Stearns and Leslie Winter, to recover the value of certain merchandise claimed to be the property of the bankrupt, and which it is alleged the defendants converted to their own use. A jury was waived and trial had to the court, resulting in a judgment in favor of the defendant Leslie Winter, and dismissing the action against him. As against defendant Stearns, the court found in favor of the plaintiff, and rendered judgment for $3,220.13. Defendant Stearns appeals.
It appears that in November, 1914, Workman owned and operated a hardware and furniture store in the town of Bayard, Nebraska. He also conducted an implement business, and bought and sold grain. In the latter part of November of that year, he sold the hardware and furniture stock to the defendant Stearns, who took possession of the stock and commenced to operate the store, selling merchandise to the trade, and replenishing the stock from time to time. At the time of the sale the inventory indicated the value of the stock to be approximately $7,650. Stearns paid $1,600 in cash at the time of the transfer of the stock to him, and for the balance agreed to turn over certain mortgages to be thereafter agreed upon. This part of the transaction was never consummated. In March, 1915, Workman was adjudged a bankrupt, Perry was appointed receiver, and later the creditors elected Perry trustee in bankruptcy. While acting as receiver, on March 31, 1915, Perry commenced an action in replevin against Stearns and Winter to obtain possession of the stock of hardware and furniture, based upon the theory that the stock belonged to the bankrupt estate, because the sale to Stearns was made in contravention of the Bulk Sales Law. Later Perry, as trustee, intervened alleging that, as trustee, he was entitled to the possession of the stock, and also alleging that the defendants Stearns and Winter, while wrongfully in possession of the stock, had sold merchandise therefrom to the amount and value of $3,246.50, and had converted the same to their own use. The sheriff under the writ of replevin took possession of all the stock of merchandise in the possession of the defendants, including the fixtures, and such merchandise then in the store purchased by Stearns since he took possession of the stock. Upon the trial of replevin suit, the jury returned two verdicts, one finding that at the commencement of the action the plaintiff--
“was entitled to the possession of the certain stock of goods in dispute, to wit, the stock of goods purchased by defendant from Noah E. Workman.”
The other verdict found in favor of the defendant Stearns, that--
“He was the owner of and entitled to the possession of all fixtures purchased by him from Noah E. Workman, being the fixtures in dispute in this action; and also that he was the owner of and entitled to the possession of all goods purchased by him after the purchase of said stock of goods in dispute from the said Noah E. Workman, and added to said stock, and we find his damages for the detention of said fixtures and said goods in the sum of $980.50.”
On November 23, 1915, the court entered judgment based on the two verdicts. The judgment recited that the plaintiff have and recover of the defendant the possession of--
“the stock of goods purchased by the defendant from Noah E. Workman, and * * * that the defendant Frank E. Stearns was at the commencement of this action the owner of and entitled to the possession of all fixtures purchased by him from Noah E. Workman, being the fixtures in dispute in this action, and also that he was the owner of and entitled to the possession of all goods purchased by him after the purchase of said stock of goods in dispute from the said Noah E. Workman, and added to said stock, and that he recover from the plaintiff the sum of $980.50, his damages by reason of the premises.”
Whatever may be said of the manner in which the replevin action was tried, no appeal was taken from the judgment.
In February, 1916, Perry commenced the present action to recover the value of the merchandise which had been sold during the period the stock was in possession of Stearns and Winter, but for unexplained reasons the action was not brought to trial until in February, 1921.
In January, 1920, Pearl E. Frank, trustee, was substituted as party plaintiff, and by leave of court filed and amended petition. A demurrer was filed to this petition upon the ground that it did not state facts sufficient to constitute a cause of action. The demurrer was overruled, and an answer filed.
It is first urged that the court erred in not sustaining the demurrer. It is argued that the petition fails to state a cause of action, because it is not alleged that the trustee in bankruptcy did not have in his hands sufficient assets to pay all the creditors of the bankrupt. It is undoubtedly true that the trustee in bankruptcy would have no standing to prosecute this action if in fact the assets in his hands were sufficient to pay the debts, and the petition should allege facts showing the right of the trustee to maintain the action. In some form it must appear that the assets are insufficient to pay the debts. The amended petition alleged that Workman was adjudged a bankrupt; that the plaintiff was the trustee in bankruptcy; that, at the time of the sale of the stock to Stearns, Workman was insolvent; and that at the time of the sale Stearns knew that Workman was insolvent. The amended petition contained other averments not pertinent to the point now being considered.
[1][7] Are the allegations of the petition equivalent to a charge...
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