Gross v. Grossman

• Decision Date: 25 November 1924
• Docket Number: No. 4317.,4317.
• Parties: GROSS v. GROSSMAN.
• Court: U.S. Court of Appeals — Fifth Circuit

2 F.2d 458 (1924)

GROSS v. GROSSMAN.

No. 4317.

Circuit Court of Appeals, Fifth Circuit.

November 25, 1924.

J. H. Synnott and J. C. Muse, both of Dallas, Tex. (Muse & Muse, of Dallas, Tex., on the brief), for appellant.

J. S. Patrick and R. E. Eubank, both of Paris, Tex., for appellee.

Before WALKER and BRYAN, Circuit Judges, and DAWKINS, District Judge.

BRYAN, Circuit Judge.

This is a suit in equity by the appellant, trustee in bankruptcy, to recover for the estate of Max Minzer, the bankrupt, a stock of goods of which the appellee, Morris Grossman, claims to be the owner.

The stock of goods in question is located at Paris, Tex., and was originally owned by Minzer, the bankrupt, who in September, 1922, opened up a dry goods store at that place, with a stock of goods worth about $3,000, shipped from his store at Dallas. No entry was made on the books of the Dallas store showing withdrawal of the goods. In July, 1922, Morris Grossman, appellee, was adjudicated a bankrupt, and on January 18, 1923, was granted his discharge by the bankruptcy court. He was in charge of the Paris store at a salary of $25 or $30 per week, from the time it was established until January 2, 1923, when he received a bill of sale of the stock of goods therein from Minzer for a recited consideration of $5,237.16. No information as to creditors was requested or given. The bill of sale was recorded in March, 1923. Both before and after it was executed, the store at Paris was conducted under the name of the Paris Bargain House, and Minzer continued to make shipments of goods to it from his Dallas store under that name, without keeping a record of such shipments, until May, 1923, when he was adjudicated a bankrupt, whether upon a voluntary or involuntary petition does not appear.

During the period intervening the date of the bill of sale and the date of Minzer's bankruptcy, Minzer's books kept at his Dallas store failed to show the disposition of goods of the value of about $9,000, but Minzer and Grossman both testified that all goods shipped to the Paris store after January 1, 1923, were paid for in cash. Minzer testified before the referee in bankruptcy that Morris Grossman did not pay or agree to pay anything for the stock of goods at Paris, but that the bill of sale was executed in satisfaction of a debt of $3,200, which he owed to appellee's brother, Henry Grossman, who was engaged in the real estate business and lived in New York. Upon filing the bill, the trustee made application to the District Court to appoint a receiver for the Paris store, and upon a hearing of that application, Morris Grossman testified that he agreed to pay $1,000 in addition to the consideration stated by Minzer. A receiver was appointed. At the final hearing, Minzer's testimony before the referee was before the court, as was also the deposition of Henry Grossman, and Morris Grossman was again examined as a witness.

The evidence of these three witnesses, relating to the consideration which appellee claims was paid for the stock of goods contained in the Paris store, is substantially as follows:

Minzer testified that in 1922 he went to Russia for the purpose of bringing his family to the United States; that on his way over he stopped in New York, and there for the first time met Henry Grossman, identifying himself by a letter of introduction, from whom he then borrowed $2,000, and later, upon his return from Europe, an additional $1,000; and that thereafter, as a result of correspondence, but without any understanding to that effect at the time the money was borrowed, he transferred the stock of goods in question to Morris Grossman in satisfaction of this indebtedness to Henry Grossman.

According to Henry Grossman's deposition, in December, 1921, he advanced $2,000 to Minzer upon the latter's agreement to bring back from Russia to this country the former's family, and after several months elapsed Minzer came to see him again, and reported that all necessary arrangements had been made with the Soviet officials, but that it would cost an additional $1,300 to get Grossman's family to the United States, and that upon this representation such additional sum was advanced. Henry Grossman further testified that his family had never arrived; that he wrote to Minzer and demanded back the sums he had advanced, which, not being paid, he authorized Morris Grossman by letter at first to collect, and then to accept the stock of goods at Paris in satisfaction of, his claim against Minzer; that the only relatives he had in Russia or Europe were two married sisters, with whom he corresponded, and to whom, from time to time, he sent money.

Morris Grossman testified that he corresponded with his brother Henry, and with the latter's consent accepted the stock of goods in the Paris store for Minzer's debt. None of the correspondence, which it is claimed passed between these three witnesses, relative to Minzer's indebtedness, or the acceptance of the stock of goods in satisfaction thereof, was offered in evidence; the explanation being that all such correspondence had been...