Gamble-Robinson Minot Co. v. Mauratis

• Decision Date: 18 August 1927
• Docket Number: No. 5238.,5238.
• Citation: 55 N.D. 616,214 N.W. 913
• Parties: GAMBLE-ROBINSON MINOT CO. v. MAURATIS.
• Court: North Dakota Supreme Court

55 N.D. 616

214 N.W. 913

GAMBLE-ROBINSON MINOT CO.

v.MAURATIS.

No. 5238.

Supreme Court of North Dakota.

June 1, 1927.

Rehearing Denied Aug. 18, 1927.

Syllabus by the Court.

Where exception was taken to the sureties on an undertaking on appeal and the appellant thereupon and within the time for the taking of an appeal made a deposit in the amount of the undertaking with the clerk of court, pursuant to section 7823, C. L. 1913, but failed to serve notice of deposit as required by said statute, the appeal will not be dismissed where such failure to serve notice is reasonably excused.

Where a defendant denies the existence of the grounds for an attachment and moves a discharge thereof on that account, the burden is upon the plaintiff to establish the existence of such grounds.

Where an attachment is issued under the fourth subdivision of section 7537, C. L. 1913, providing that his property may be attached “when the defendant has sold, assigned, transferred, secreted or otherwise disposed of, or is about to sell, assign, transfer, secrete or otherwise dispose of his property, with intent to cheat or defraud his creditors, or to hinder or delay them in the collection of their debts,” and the existence of these grounds for the attachment is denied, the alleged statutory intent must be established by the plaintiff as a matter of fact.

The defendant, engaged in the restaurant and confectionery business, borrowed money to buy his business equipment and mortgaged such equipment to secure the debt thus incurred. Then he bought his stock in trade on account and sold it out in the usual course of business. He devoted the greater portion of the proceeds of the sales to the payment of his mortgage debt and applied only a lesser share on the account. Held, for reasons stated in the opinion that his actions in these respects will not in themselves warrant the inference of such an intent as to sustain an attachment under the fourth subdivision of section 7537, C. L. 1913, providing that his property may be attached “when the defendant has sold, assigned, transferred, secreted, or otherwise disposed of, or is about to sell, assign, transfer, secrete or otherwise dispose of his property, with intent to cheat or defraud his creditors, or to hinder or delay them in the collection of their debts.”

Appeal from District Court, Ward County; Geo. H. Moellring, Judge.

Action by the Gamble-Robinson Minot Company against Ted Mauratis, doing business under the name of the Venus Tea Room, in which certain goods were attached. From an order denying defendant's motion to discharge the attachment, defendant appeals. Reversed.F. J. Funke and Sinkler & Brekke, all of Minot, for appellant.

L. J. Palda, Jr., C. E. Brace, and Robert W. Palda, all of Minot, for respondent.

NUESSLE, J.

This appeal is from an order of the district court of Ward county denying a motion to discharge an attachment.

The plaintiff is engaged in the wholesale grocery business. The defendant operated a restaurant and confectionery store. The action in which the attachment issued was brought to recover a balance of $751.57 on an account for merchandise sold and delivered to the defendant by the plaintiff between the 1st day of January, 1925, and the 6th day of March, 1926. There was a balance of $445.89 unpaid on this account on January 1, 1926. The defendant paid between January 1 and March 6, 1926, $470.24. Thus it appears that the debt for which the plaintiff seeks to recover is less than the value of the goods sold to the defendant between January 1 and March 6, 1926.

The warrant of attachment was issued upon an affidavit reciting that “the defendant has sold, assigned, transferred, secreted, or otherwise disposed of, or is about to sell, assign, transfer, secrete or otherwise dispose of his property with intent to cheat or defraud his creditors, or to hinder or delay them in the collection of their debts.” The defendant moved to discharge the attachment on the ground that the affidavit for attachment was false. This motion was grounded upon defendant's affidavit reciting that the property seized under the warrant was of the value of $2,800; that such property belonged to the defendant and consisted of fixtures, equipment, and merchandise used by the defendant in the operation of his business; that defendant had made no sale of any of his said property other than in the usual course of business and had made no arrangements to sell, assign, transfer, secrete, or otherwise dispose of such property other than in the usual course of business. In resistance of the motion plaintiff filed additional affidavits wherein it was set forth that the defendant had executed four several chattel mortgages covering all of the furniture and fixtures owned by the defendant and contained in his place of business; that three of these mortgages, filed, respectively, on December 13, 1924, August 19, 1925, and October 26, 1925, were executed to the Citizens' State Bank of Minot at about the dates of their filing, to secure items of indebtedness aggregating $9,384.80; that the fourth of said mortgages was executed and filed on the 7th day of August, 1925, and covered a certain range and pressure boiler to secure the purchase price thereof in the sum of $535.75; that none of these mortgages has been satisfied; that the property mortgaged consisted of all of the personal property of the defendant excepting certain wares and merchandise kept for sale by him in his place of business; that the Citizens' State Bank claimed defendant owed it far more than the amount for which the mortgages stood as security; that the defendant for some time prior to the issuance of the writ of attachment had deposited all of the receipts and income from his business with the bank with the understanding that the bank should have the right to apply such deposits in payment of the indebtedness owing to it; that by reason of these facts the defendant had sold, assigned, transferred, secreted, or otherwise disposed of his property, with intent to hinder and delay the plaintiff and other unsecured creditors in the collection of their debts, and that the defendant had no other property than that attached. The defendant filed an affidavit in rebuttal wherein he admitted the making of the mortgages to the Citizens' State Bank as set out in the defendant's affidavit, but alleged that the same were given by him to secure indebtedness owing to the bank and in renewal of mortgages previously given to the said bank to secure the same; that such indebtedness originated long prior to any transactions between the plaintiff and defendant and was for money borrowed by defendant with which to begin his business and purchase furniture and fixtures and improve his place of business; that the mortgage covering the range and pressure boiler was given to secure the purchase price thereof, and that such range and boiler were required and used in the carrying on of defendant's business; that such mortgages were made in good faith and in the ordinary course of business without any intention to hinder, delay, or defraud the defendant's creditors. Defendant further admitted that he had deposited receipts from his business in the Citizens' State Bank, but alleged that such deposits were made in the ordinary course of his banking business; that the funds so...