Grant v. Minneapolis Brewing Co.

• Citation: 70 N.W. 868,68 Minn. 86
• Parties: GRANT v, MINNEAPOLIS BREWING CO.
• Decision Date: 30 April 1897
• Court: Supreme Court of Minnesota (US)

68 Minn. 86

70 N.W. 868

GRANTvMINNEAPOLIS BREWING CO.

Supreme Court of Minnesota.

April 30, 1897.

(Syllabus by the Court.)

1. More than 90 days before making an assignment under the insolvency law, the insolvent borrowed a sum of money, and agreed that, if he did not repay it at a certain time, he would secure it by a chattel mortgage on certain personal property. (It does not appear that he was then insolvent.) Thereafter, and within such 90 days, he executed such mortgage pursuant to said agreement. He was then insolvent, which he and the lender then knew, and the mortgage was given and received for the purpose of giving the lender a preference over the insolvent's other creditors. Thereafter, and before the assignment, the insolvent paid the mortgage. Held, such payment was an unlawful preference, and the assignee is entitled to recover back the amount so paid.

2. Within such 90 days, and while so insolvent, said assignor sold certain property, and the purchaser, as part of the purchase price, agreed to pay another antecedent debt due from the assignor to defendant, but has not done so. Held, the defendant cannot be required to refund, as an unlawful preference, what he has never received.

Appeals from district court, Hennepin county; Robert D. Russell, Judge.

Action by J. Colfax Grant against the Minneapolis Brewing Company. Each party moved for a new trial, and from orders denying the motions they appealed. Affirmed on both appeals.

Welch, Hayne, Hubachek & Conlin and Rea, Hubachek & Healy, for plaintiff.

Cobb & Wheelwright, for defendant.

CANTY, J.

One Schneider, being insolvent, made an assignment on June 27, 1895, under our insolvency law, for the equal benefit of all his creditors who would file releases. The plaintiff, his assignee, brought this action to set aside, as an unlawful preference, certain payments made to defendant, and to recover the amounts so paid. On the trial before the court without a jury, the court granted plaintiff the relief demanded, as to one item of payment, but denied it as to another. Each party moved for a new trial, and from an order denying the motion appeals to this court.

First, as to defendant's appeal: The court found that on February 8, 1895, Schneider borrowed of defendant $450, for which he executed his promissory note, “payable to defendant in 1 month and 20 days, and then and there agreed with the defendant that, if he did not pay the said note at its maturity, he would secure the same, and the indebtedness thereby represented, by the execution and delivery of a chattel mortgage upon his saloon furniture and fixtures.” The court further found that on May 17, 1895, said loan was wholly unpaid, and, in pursuance of his said promise to secure the same, said Schneider made to defendant a chattel mortgage on said saloon furniture and fixtures, and defendant received the mortgage pursuant to his said promise. On June 11, 1895, the chattel mortgage...