Jaffrey v. Wolf
| Decision Date | 04 September 1896 |
| Parties | JAFFREY et al. v. WOLF et al. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
A chattel mortgage was given on December 15, 1890, by W. & Son upon a stock of goods, wares, and merchandise, to V., of which V. immediately took possession. The plaintiffs forthwith sued W. & Son, on December 17, 1890, for an amount claimed to be due them, and seized the goods under a writ of attachment, alleging that (1) the defendants had sold and conveyed and otherwise disposed of their property with the intent to cheat or defraud their creditors, or to hinder or delay them in the collection of their debts, and (2) that the defendants fraudulently contracted the debt and incurred the obligation for which the suit was brought. Plaintiffs alleged that the claim was, according to the provisions of the contract, due on the 1st day of May, 1891. Upon the hearing of the case in April, 1891, the plaintiffs applied to the trial court for leave to amend their complaint and attachment affidavit by a showing that the goods sold by plaintiffs to defendants had been disposed of by them, and that, as a consequence, no suit for recovery of the specific goods sold could be effective. The application to amend the complaint was allowed. The application to amend the attachment affidavit was refused. Upon the hearing of the cause, the plaintiffs' evidence having been introduced, the defendants demurred. The cause was tried under the Indiana Code of Civil Procedure, which went into force in this territory December, 1890. The rules of that Code, and their interpretation and construction by the supreme court of the state of Indians, governing the trial and rendition of judgment, provide that the jury, if a jury has been impaneled, would be discharged by the court, and such evidence only as had been offered tending to make out the case in behalf of the plaintiffs would be considered. All the evidence tending to make out the case in behalf of the defendants would be excluded, and the sole question would be is there any evidence legally tending or conducing to support the allegations of plaintiffs' petition? In this case the court sustained the demurrer to the petition. Being thus required to examine the evidence, and to pass upon the fact as to whether there was any evidence of fraud legally tending to support the allegations of plaintiffs' petition and affidavit in attachment, and finding that such evidence existed, it is our conclusion that the judgment should be reversed, and that the finding and judgment should have been for the plaintiffs for the amount claimed in their petition and that the attachment should be sustained.
For the argument upon the demurrer to the evidence, the rule which must guide the court under the Indiana Code of Civil Procedure is that all of the adversary's evidence must be admitted as true, and that all of the defendants' testimony, so far as any has been adduced up to that point shall be considered as withdrawn or false, and, if any legal evidence whatever has been adduced tending to make out the plaintiffs' case, the ruling will be in favor of the plaintiffs, the demurrer being overruled, and judgment will be rendered accordingly.
The chattel mortgage having been executed to V., for himself and other mortgagees, under an authority to him to obtain for them such security as he could, and evidence having been produced to show fraud in the taking of the said chattel mortgage, which fraud was known to V., knowledge of the fraud will also be chargeable to the other chattel mortgagees, and the mortgage will be regarded as altogether fraudulent.
If a chattel mortgage is affected with fraud in part, in the intention to fraudulently hinder or delay creditors, it will be regarded as fraudulent altogether, and will be set aside in behalf of the suing creditors.
If the mortgagee in a chattel mortgage be otherwise abundantly secured, the taking of additional security by the chattel mortgage will itself be considered as evidence of fraud, for creditors will not be permitted to pile security on security unnecessarily, to the detriment of other creditors.
If credit be extended and a debt incurred by means of fraudulent representations, the creditor is entitled to sue at once for payment for the amount due under the contract, whenever the fraud is discovered, notwithstanding the fact that the debt by its terms may not then be due; and the plaintiffs are not limited to an action for damages if they see fit to sue prior to the maturity of the debt under the contract.
If goods be shipped to this territory purchased in New York, the laws of the state of New York will apply in the interpretation of the contract, and to all facts determining the maturity of the amount due.
An amendment asked for by the plaintiffs to the attachment affidavit, showing that the defendants had entirely disposed of property purchased of plaintiffs, and which had been purchased upon fraudulent representations, and that it was out of the power of the plaintiffs, therefore, to recover by replevin, was proper, and should have been allowed.
Error to district court, Logan county.
Action by E. S. Jaffrey & Co. against William F. Wolf and another. From a judgment for defendants, plaintiffs bring error. Reversed.
Wisby & Horner and Keaton & Cotteral, for plaintiffs in error.
Harper S. Cunningham, for defendants in error.
McATEE, J.
This case was passed upon by this court (1 Okl. 312, 33 P. 945), and is now here upon petition for review. This suit was begun by the filing of the complaint in this district court of Logan county on December 17, 1890, in which the plaintiffs in error here alleged that the defendants were indebted to them in the sum of $5,250 for goods, wares, and merchandise sold and delivered to the defendants, which sum would be due on the 1st day of May, 1891, and that the defendants refused to pay for the same. At the time of the filing of the suit, the plaintiffs also filed their affidavit for attachment, alleging that the defendants had sold, conveyed, and otherwise disposed of their property with the intent to cheat or defraud their creditors, or to hinder or delay them in the collection of their debts, and that the defendants fraudulently contracted the debt and incurred the obligation for which the suit was brought. The plaintiffs also alleged that the claim became due on the 1st day of May, 1891. The defendants, prior to 1890, had been engaged in the mercantile business in the city of Topeka, Kan., but removed part of their stock of goods to Oklahoma City, and the remainder there of to the city of Guthrie, about the 1st of June, 1890, opening up in each of those cities a dry goods, clothing, and general merchandise store. They were, at the time of removal of the stock, indebted to Tootle, Hosea & Co., Henry W. King & Co., the Central National Bank of Topeka, the Bank of Topeka, A. H. Vance, and to A. H. Vance, D. A. Harvey, and T. J. Clark, as sureties, in the sum of $22,000. The defendants, prior to the contraction of the debt herein sued for, had been possessed of real estate in the city of Topeka, but on the 5th of July, 1887, Louis H. Wolf deeded lot No. 15, in Potwin's subdivision of the city of Topeka, and owned no real estate there after that. In May, 1890, W. F. Wolf and Louise H. Wolf transferred lots Nos. 21, 22, and 23, in block 34, in Oklahoma City, for a consideration stated at $4,700, to the wife of W. F. Wolf and the mother of Louis H. Wolf, Georgia H. Wolf, by transferring the town site title, for which she subsequently procured the town-site deed. This conveyance was made for $11,000, borrowed some years previously. On July 26, 1890, W. F. Wolf and Georgia Wolf, his wife, granted lot No. 20, Greenwood avenue, in Potwin's Place, Topeka, by warranty deed, to Laura V. Vance, their daughter, and the wife of A. H. Vance, the expressed consideration being $6,500. On this property there was a mortgage of $4,000. Neither of the defendants owned any real estate thereafter. On July 29, 1890, the defendants, desiring to purchase goods upon credit from the plaintiffs, gave to them the following statement of their financial condition:
Stock in Oklahoma City $17,000 00
Guthrie stock 35,000 00
Real estate in Oklahoma City 12,000 00
Topeka real estate 20,000 00 ...................... L
Making total firm assets of de"
fendants $84,000 00
Liabilities 27,000 00
Leaving total worth of the firm of $57,000 00
The statement was false and fraudulent, but the plaintiffs relying upon the representations contained in it, sold the goods, to recover the value of which this suit was brought. At various times from June 7, 1890, to August 22, 1890, the same statement was made to various other large wholesale mercantile firms, from all of whom goods were there upon purchased, to the total amount of about $16,000. On December 13, 1890, A. H. Vance, representing Tootle, Hosea & Co., Henry W. King & Co., the Central National Bank of Topeka, the Bank of Topeka, himself on his own account, and also D. A. Harvey, T. J. Clark, and himself as sureties on indebtedness to the foregoing creditors, came from Topeka, Kan., to Oklahoma, and received from the defendants a chattel mortgage covering the stock of goods in Guthrie and Oklahoma City, and, in fact, all the property which defendants then owned. The mortgage provided that ...
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