Josephi v. Mady Clothing Co.
| Decision Date | 22 May 1893 |
| Citation | 33 P. 1,13 Mont. 195 |
| Parties | JOSEPHI et al. v. MADY CLOTHING CO. |
| Court | Montana Supreme Court |
Appeal from district court, Lewis and Clarke county; William H. Hunt and Horace R. Buck, Judges.
Action by Isaac Josephi and others against the Mady Clothing Company.
Action by Isaac Josephi and others against the Mady Clothing Company.
From a judgment for plaintiffs, defendant appeals. Affirmed.
The other facts fully appear in the following statement by DE WITT, J.:
The plaintiffs brought this action to recover judgment for $1,283.50, on account of goods sold and delivered to defendant, a corporation. There was an unexpired credit upon the account. The plaintiffs brought the action under the following provision of section 183, Code Civil Proc. "Actions may be commenced and writs of attachment issued upon any debt for the payment of money or specific property before the same shall have become due, when it shall appear by the affidavit," etc. The section then goes on to provide what shall appear by the affidavit, in order that the attachment may issue. The complaint pleads the indebtedness and the unexpired credit, and then alleges, in sections 3-5 substantially as follows: That defendant is endeavoring to and is about to, dispose of all its property subject to execution, for the purpose of defrauding its creditors; that is, defendant, by its officers, has entered into a collusive agreement with Reinhold H. Kleinschmidt and Albert Kleinschmidt, whereby it is pretended that defendants is indebted to said Kleinschmidts in the sum of $13,613.37, upon an alleged promissory note of defendant to said Kleinschmidts, of the date of October 2, 1890; that if said note were made, it was without consideration, nor was said defendant at all indebted to said Kleinschmidts, but the note was made for the purpose of enabling the Kleinschmidts to attach the property of defendant, and to take the same from the reach of the creditors of defendant, and to delay them in the collection of their debts; that in pursuance to such design, and in collusion with defendant, said Kleinschmidts on October 15, 1890, procured an attachment against defendant, and levied upon all its property. The affidavit upon attachment in the case at bar, in addition to the matter required to be set out in an affidavit upon attachment for a debt due, contained the following statement: "That the same [that is, the indebtedness is not yet due, but that defendant is endeavoring to, and is about to, dispose of all its property subject to execution to Reinhold H. Kleinschmidt and Albert Kleinschmidt, for the purpose of defrauding its creditors, and that the payment is not secured by any mortgage, lien, or pledge upon real or personal property." A trial by jury resulted in a verdict for plaintiffs. Judgment was entered for the amount claimed. Defendant's motion for a new trial was denied. From that order and the judgment, defendant now appeals. The alleged errors relied upon are stated as they are discussed in the opinion below.
Cullen, Sanders & Shelton and Henry C. Smith, for appellant.
H. G. MeIntire, McConnell, Clayberg & Gunn, and F. N. & S. H. McIntire, for respondents.
DE WITT, J., (after stating the facts.)
Upon the trial of the case the defendant objected to the evidence in reference to the alleged fraudulent disposition of the property, upon the ground that the affidavit setting it forth was defective. The affidavit setting for th the fraudulent intent is in the language of the statute. The defendant's objection was that the affidavit states no facts within the statutory requirements. Thereupon the plaintiffs asked leave to amend their affidavit, which leave was granted by the court, and they then and there incorporated into the affidavit five paragraphs of the complaint, including paragraphs 3, 4, and 5, mentioned in the statement above, which paragraphs were a full setting forth of the acts which plaintiffs claimed showed the fraudulent intent of the defendant to dispose of its property. It is not contended by appellant that the affidavit as amended was insufficient, but it is now urged in this court that the original affidavit was jurisdictional, and that it was so defective that it was no affidavit, and the court never had jurisdiction of the case. Respondents contend that, even if the original affidavit were not sufficient, it was not error to allow the amendment. This case is not like those cases wherein there was no affidavit at all. There was an affidavit here, which set out the facts in the language of the statute. The complaint is that they were not sufficiently stated. Passing the question of whether the affidavit was originally sufficient, we feel satisfied that the tendency of the decisions of this court is that such an affidavit may be amended. Pierse v. Miles, 5 Mont. 549, 6 P. 347; Langstaff v. Miles, 5 Mont. 554, 6 P. 356; Magee v. Fogerty, 6 Mont. 237, 11 P. 668. In the last case, Chief Justice Wade, in the opinion, said: "The procuring of an attachment, and the steps necessary therefor, is a proceeding within the spirit and meaning of the one hundred and fourteenth section [chapter VIII., Code Civil Proc.] of the Code of Civil Procedure; and if such proceeding is defective, the same may be amended, in the furtherance of justice, like any other proceeding under that section."
As to the estoppel suggested by appellant by reason of the judgment in the case of Kleinschmidt & Brother v. Mady Clothing Company, I concur in the result reached in the other opinion filed in this case.
Another error claimed is as follows: A witness, Gaines, was upon the stand. He says that in 1890 he was the agent of the commercial reporting association of R. G. Dun & Co. He was asked this question: "Tell us what your conversation was with Mr. Kleinschmidt, in May, 1890, in reference to the Mady Clothing Company?" The defendant objected, on the ground that Kleinschmidt was not a party to the action, and the declarations made by him are not material to bind any one connected with the parties, or the parties themselves. The objection was overruled, and the witness testified that Kleinschmidt had told him, about May 3, 1890, that the capital stock of defendant was $15,000; that he held $10,000 and Mady $5,000; and that the company had started with a clean balance sheet. The company was incorporated May 1, 1890. It appears that Kleinschmidt was a trustee of defendant, and a stockholder to the extent of two-thirds of the stock. A contention of the action was that defendant was disposing of its goods with the intent to defraud its creditors, and disposing of them to this same Albert Kleinschmidt and another. It was being contended that about the commencement of the action there was a large alleged indebtedness from the...
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