Ideal Clothing Co. v. Hazle

• Decision Date: 16 April 1901
• Citation: 126 Mich. 262,85 N.W. 735
• Court: Michigan Supreme Court
• Parties: IDEAL CLOTHING CO. et al. v. HAZLE et al.

85 N.W. 735

126 Mich. 262

IDEAL CLOTHING CO. et al. v. HAZLE et al.

Supreme Court of Michigan

April 16, 1901

Appeal from circuit court, Clinton county, in chancery.

Bill by the Ideal Clothing Company and others against Fred E. Hazle and others to enjoin defendants from transferring their property until plaintiffs could proceed against them under the bankruptcy act. From an order overruling a demurrer to the bill, defendants appeal. Reversed.

High & Everett (Spaulding, Norton & Dooling, of counsel), for appellants.

Almond G. Shepard and Edwin H. Lyon, for appellees.

HOOKER J.

Hazle &amp Clark, co-partners, carried on a shoe business in Ovid. The complainants sold them goods, and were severally their creditors. Their bill of complaint, filed on or about September 13, 1898, at which time a temporary injunction was allowed, states their various claims, and that, with the exception of $33, they were not due. It alleges further that the persons comprising the firm of Hazle & Clark pretended to sell and delivered their stock to one Lamb, and conveyed their lands to their wives; all in fraud of creditors. It alleges also that they were insolvent, and that on the preceding 1st of July--i. e. 1898--the federal bankrupt act took effect, and that the defendants Hazle &amp Clerk were guilty of acts of bankruptcy under its provisions but that they had not filed a petition for valuntary bankruptcy, and that the creditors could not file a petition for involuntary bankruptcy until the expiration of four months from July 1, 1898, as provided in said act, at which time it was complainants' intention to file such a petition. It prayed that the transfers might be declared fraudulent as against creditors, and that an injunction be issued restraining the transfer of said property by any of the persons mentioned--all being made parties--until proceedings in bankruptcy could be commenced. An injunction was issued, but was afterwards dissolved. Defendants demurred to the bill, and have appealed from an order overruling the demurrer.

Apparently the only question relied upon under the demurrer relates to the jurisdiction of the court to entertain such a suit. Complainants contend: First, that the demurrer is not a general demurrer, and that the order is not appealable second, that the bill states a case entitling them to the relief prayed. Our statute (Comp. Laws, � 549) is anomalous in permitting an appeal from an order overruling a demurrer. Usually appeals are permitted only after final judgment or decree. This is an exception, however, but the right is limited to cases where the order is upon a general demurrer. The demurrer should, in our opinion, be treated as a good general demurrer. All of the special reasons contained in it (in accordance with rule 9), except one, go to the equity of the bill. In the case of Turck v. Soule, 55 Mich. 128, 20 N.W. 822, it is indicated that, where a demurrer is both general and special, in order overruling the demurrer, with leave to answer, cannot be appealed from; but this appears to have been overruled by the case of Shaw v. Chase, 77 Mich. 437, 43 N.W. 883, where the court considered that case upon the alleged want of equity, though the demurrer was both general and special. We may do the same here. It has been intimated that at the time the bill was filed only $33 of complainants' claims were due. There was no impediment to proceedings by attachment for both due and undue claims, if, as alleged in the bill, the transfers were fraudulent. Moreover, if it was also true that the goods were procured through fraud, replevin or trover would lie. The only reason given for not...