Hurlburt v. Palmer

• Decision Date: 06 February 1894
• Citation: 57 N.W. 1019,39 Neb. 158
• Parties: HURLBURT ET AL. v. PALMER ET AL.
• Court: Nebraska Supreme Court

39 Neb. 158

57 N.W. 1019

HURLBURT ET AL.

v.PALMER ET AL.

Supreme Court of Nebraska.

Feb. 6, 1894.

Syllabus by the Court.

1. A shipper of hogs arranged with a firm of commission brokers that all his hogs, as purchased, should be consigned to said brokers for sale; the said brokers, on their part, agreeing to pay such drafts as by the shipper should be made on them through a local bank, the proceeds of such drafts to be used by the shipper in making payments for hogs purchased, and to be consigned as the property of the shipper. Held, that the mere fact that the said bank, without fraud or collusion, though with knowledge that the shipper was procuring funds with which to purchase hogs under this arrangement, induced the shipper to pay to itself a debt justly due it from him, (he using for that purpose the proceeds of drafts drawn through the bank, as above contemplated,) did not render the bank liable to pay to the aforesaid firm of brokers the amount or value of property so received by it, whether in money, or in hogs purchased by the shipper.

2. The plaintiffs in error, who were defendants in the trial court, answered: (1) By a general denial qualified by certain admissions. (2) That by an abuse of the criminal process of the state a codefendant had been taken from the jail of Seward county to Douglas county, wherein he was served with summons, after which he was returned at once to the Seward county jail; that all the defendants were, at the commencement of the action, residents of Seward county; and that the aforesaid abuse of criminal process was resorted to by and on behalf of plaintiffs solely to obtain, in Douglas county, jurisdiction of the persons of the answering defendants, notwithstanding their residence in Seward county. Held: First, that the facts pleaded as to the jurisdiction of the district court of Douglas county stated a substantive defense properly presented by answer; second, that the second defense pleaded was not waived by reason of being included in the answer, wherein had been stated the first defense; third, that such objections to the jurisdiction as do not arise upon the summons, the indorsement or service of the summons, or upon the face of the petition must be raised by answer as a matter of defense.

3. When the district court has not otherwise obtained jurisdiction of the person of a defendant, he does not submit himself to its jurisdiction by appealing or prosecuting error to this court; and the case of Shawang v. Love, 17 N. W. 264, 15 Neb. 142, holding the contrary doctrine is overruled, as in contravention of the provisions of section 24, art. 1, of the constitution of this state.

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

Action in assumpsit by Clinton R. Palmer and others against George L. Hurlburt and others. There was judgment for plaintiffs, and defendants bring error. Reversed.

R. S. Norval and E. M. Bartlett, for plaintiffs in error.

Colman & Colman and Chas. Offutt, for defendants in error.

RYAN, C.

During all the time within which the transactions referred to in this case took place, the firm of Palmer, Richman & Co. was engaged in the live-stock commission business in South Omaha. At the same time, George L. Hurlburt, George Liggett, and Clifford G. Hurlburt were doing business at Utica, Neb., under the name and style of the Merchants' Bank. Alexander C. Virgin was also a resident of the town last named. The first-named firm sued the aforesaid banking partners and Alexander C. Virgin, in the district court of Douglas county, Neb., for the sum of $2,000, with interest from the 1st day of December, 1888, and costs. Upon a verdict found in favor of Palmer, Richman & Co., judgment was rendered for its amount, being for the sum of $2,023.43. The Hurlburts and Liggett bring the case into this court for review upon petition in error.

The petition in the district court, after stating the facts above set forth as to the membership of the above firm, their occupation and location, stated the plaintiffs' cause of action in the following language: “(3) That about the middle of the month of October, 1888, these plaintiffs arranged with the defendant Alexander C. Virgin that these plaintiffs would furnish the said Virgin money with which to pay for cattle and hogs which the said Virgin might thereafter buy, on condition that the said Virgin should consign the same to these plaintiffs at South Omaha for sale on the market, and that these plaintiffs would make sale of the stock so consigned to them, and apply the proceeds of such sales, less the commission of these plaintiffs, to the payment of the money, and interest thereon, so as aforesaid advanced to the said Virgin; and the said Virgin, in consideration thereof, did agree to proceed at once to make purchase of the said stock, and that after he had purchased the same he would draw upon these plaintiffs at sight for the amount of the cost thereof, through the defendant the Merchants' Bank aforesaid,--these plaintiffs then saying, and it being distinctly understood between them and the said Virgin, that the said Virgin was not to make any drafts upon these plaintiffs for such advances until after he had purchased the stock for shipment to the plaintiffs as aforesaid, and that the said drafts should in no case exceed the amount which the said Virgin had actually contracted to pay for the stock actually purchased by him and arranged for their shipment to these plaintiffs. (4) Plaintiffs say that the defendant Virgin immediately thereafter acquainted the defendant the Merchants' Bank with the nature of the said agreement with these plaintiffs, and that, before any payments were made by these plaintiffs on account of said agreement to the defendant Virgin, the defendant the Merchants' Bank fully knew and understood the exact nature and extent of the agreement with regard to the advances so to be made by these plaintiffs, and the exact nature and condition of said agreement. (5) That at that time--that is to say, during the month of October, 1888--the said Virgin was indebted to his codefendant the Merchants' Bank of Utica in a large sum of money, the exact amount of which is unknown to these plaintiffs, but the same was more than $2,000.00, and the said Virgin was then, as these plaintiffs are now informed, insolvent and largely involved, all of which was well known to his codefendant the Merchants' Bank of Utica; that said Merchants' Bank of Utica, unlawfully and fraudulently designing to cheat and defraud these plaintiffs out of their money, and fraudulently designing and intending to secure the indebtedness which the said Virgin then owed to the Merchants' Bank by obtaining payment thereof from these plaintiffs, did unlawfully and fraudulently agree and arrange with the said Virgin that said Virgin should draw on these plaintiffs for large sums of money, to wit, on November 16, 1888, for $1,800.00, and on November 20, 1888, for $1,000.00, and that the same should be applied on the indebtedness said Virgin then owed the Merchants' Bank, as aforesaid, in fraud of the rights of these plaintiffs. (6) And the plaintiffs say that, upon or about the dates aforesaid, the defendant Virgin, in pursuance of the arrangements with the defendant the Merchants' Bank, as hereinbefore stated, did draw upon these plaintiffs for the said sums of $1,800.00 and $1,000.00 through the defendant the Merchants' Bank, and the said drafts were, as soon as presented to these plaintiffs, viz. on or about November 19th and 24th, respectively, paid by these plaintiffs, in full, and the proceeds thereof remitted to and received by the defendant the Merchants' Bank; that, at the time the said drafts were drawn as aforesaid, the defendant Virgin had not purchased the stock to be paid for with the aforesaid money, except about $800.00 thereof, and the said Merchants' Bank well knew that fact, and well knew the defendant Virgin had no right or authority to draw upon these plaintiffs for any portion of said money, except so much thereof as was necessary to pay for such stock as said Virgin may have purchased for shipment to these plaintiffs, and received the same in full of these drafts, and converted the same to its own use, by applying the same wrongfully and fraudulently to the indebtedness which the said Virgin owed it, as aforesaid; and that the $800.00 worth of stock was purchased, as aforesaid, by the said Virgin, the amount in full thereof was received by the said defendant the Merchants' Bank in part discharge of said Virgin's indebtedness to it, well knowing at the time that the said stock, and the said money with which the same was paid, were the property of these plaintiffs. And plaintiffs say that they have demanded that the defendants should repay the same to these plaintiffs, but they have failed to pay the same, or any part thereof, and that by reason of their said failure these plaintiffs have been damaged by the defendants in the sum of $2,000.00, no part of which has been paid.”

These averments of the petition are set out in full, that there may be no misapprehension as to the theory upon which plaintiffs based their right of recovery. The evidence discloses the fact that at the time the two drafts of date November 19th and November 24th, respectively, were drawn, the defendant Virgin was indebted to the bank in a sum exceeding the amount of either of said drafts. It is equally clear from the testimony that the title to the property purchased by Virgin for shipment to Palmer, Richman & Co., was not in Palmer, Richman & Co., nor did the arrangement between these parties and Virgin contemplate that the title should be held by any other than Virgin himself until the several shipments were received at South Omaha. There is no testimony whatever to sustain the averment that there was a conspiracy, or anything in the nature of a conspiracy, between the partners composing the Merchants' Bank and Virgin, with respect...