Knox v. Fuller

• Decision Date: 25 August 1900
• Citation: Knox v. Fuller, 23 Wash. 34, 62 P. 131 (Wash. 1900)
• Parties: KNOX v. FULLER et al.
• Court: Washington Supreme Court

62 P. 131

23 Wash. 34

KNOX v. FULLER et al.

Supreme Court of Washington

August 25, 1900

Appeal from superior court, King county; William Hickman Moore Judge.

Action by Andrew Knox, receiver, against W. P. Fuller and another.From a judgment in favor of plaintiff, defendants appeal.Affirmed.

Kerr &amp McCord and Everett C. Ellis, for appellants.

Wilmon Tucker and Ivan L. Hyland, for respondent.

WHITE, J.

The respondent, Andrew Knox, is the receiver of the Friday Canning Company, a corporation existing under the laws of the state of Washington, and was appointed such receiver on the 27th day of August, 1898, by the superior court of Snohomish county, in an action wherein John Walsh was plaintiff and the said Friday Canning Company was defendant.The principal place of business to the Friday Canning Company, prior to the appointment of the receiver, was Stanwood, Snohomish county Wash.; and the business of said company was controlled and managed by Frank P. Friday, its president and general manager.Some time in the latter part of July or the first of August, 1898, the Friday Canning Company became insolvent and was wholly unable to pay its debts.Hence the action institued in Snohomish county, and the appointment of the receiver therein.About the 15th day of July, 1898, the appellant sold to the Friday Canning Company certain goods, wares, and merchandise, consisting of lacquer, turpentine, and lacquer shading, agreegating in all the sum of $203.98.The sale was made under the following circumstances: Early in the month of July, 1898, Mr. Friday went to the place of business of the appellant, in the city of Seattle, and stated that he would require some lacquer and turpentine, to be used at his cannery at Stanwood, and made inquiries as to the price, and placed a verbal order for five barrels of lacquer and ten cases of turpentine.At the time, he stated it would be about two weeks before he would want the goods, and that he would advise the appellant when to ship.Appellant told Mr. Friday that it would sell him the goods, stating the price, to be paid for on delivery in cash.Two weeks after that, Mr. Friday personally ordered the goods to be forwarded.The goods were shipped on the 15th of July, 1898.Mr. Friday stated, either at the time the order was placed, or when he ordered the goods to be forwarded, that he had $4,000 in the bank, to pay for his supplies, and that the goods would be paid for when delivered.When the goods were ordered to be forwarded, Mr. Friday wanted the appellant to make up a bill for the goods.The appellant told him it could not do it until it found out the number of gallons.A bill of the goods was sent to Mr. Friday, for him to send a check covering the price.The appellant knew nothing about the financial conditions of the Friday Canning Company at the time of forwarding the goods, only as represented by Mr. Friday, and he stated that they had $4,000 cash in the bank to conduct their business.The goods were sent to Standwood by boat.The shipping receipts were the ordinary receipts, such as boats usually use.No instructions were given to the carrier about receiving payment for the goods before delivering them to the canning company or to Mr. Friday.The goods were billed in the name of Mr. Friday.When they reached Stanwood they were placed in the stamboat warehouse, in the charge of a wharfinger independent of the carrier and the canning company.The freight was not paid.No demand was made for the freight as a condition to their delivery to the canning company.There were five barrels of lacquer and thirteen packages of lacquer shading and turpentine.The canning company's establishment was about 250 feet from the warehouse.The wharfinger gave to the foreman of the canning company a key to the warehouse, to get the goods when he might want them and as he chose; and he took just what he wanted, and as he could handle them.The foreman did not remove all of the goods from the warehouse, because the material was inflammable, and he had no room in the cannery proper for the goods.He did, however, between the 2d and 4th of August, 1898, remove one barrel of lacquer and seven packages of turpentine and lacquer shading, and mixed a portion up, to be used in the cannery.No storage was paid to the wharfinger.The wharfinger permitted the goods to be taken out without the freight being paid on them, and no claim was made for the freight at that time, and that was a custom of almost daily occurrence as to all goods; and the wharfinger stated that he could not say whether he would have let any more go, or not, than those taken by the foreman, without the freight being paid, but that he would not have permitted the removal of a considerable portion without the payment of the freight.The foreman was asked: 'What kind of an understanding did you have with him [the wharfinger] about you taking goods out?Ans.Well, he doesn't stay at the wharf, you know, all the while, and he has other business; and so that I wouldn't have to be running after him, or be running after me, I told him I would take them as I wanted them.He says: 'All right.Here is a key.Go down and get them as you want them.'' The wharfinger had never received any instructions to retain the goods until the purchase price was paid or until the freight was paid.It may be fairly presumed from the evidence that the statements of Mr. Friday touching ability to pay for the goods on delivery, and as to money on deposit in the bank for that purpose, were untrue.On or about August 18, 1898, the Friday Canning Company ceased operations, and about that time Mr. Friday informed the foreman that they were unable to pay their bills.The foreman left, and subsequently instituted the proceedings which resulted in the appointment of the receiver.On the 23d or 24th of August, 1898, the appellant sent its agent to Stanwood with instructions to get the cash for the goods or the goods.When he arrived there, Mr. Friday told him that they were insolvent; and, Mr. Friday consenting, the agent of appellant took the goods that remained in the warehouse and the goods that were at the cannery, and the mixture from the goods, paid or assumed to pay the wharfinger the freight, wharfage, and storage charges, and reshipped the goods back to the appellant.The appellant then credited the Friday Canning Company with them on its books.The testimony of the appellant, as well as the testimony of the respondent, fully sustains the verdict of the jury that the value of the goods when they were taken by the appellant was $165.This action was brought by the respondent to recover from W. P. Fuller & Co. the value of the property taken away from the canning company after it became insolvent, upon the theory that all of the property of the Friday Canning Company, upon its becoming insolvent, became a trust fund in the hands of its officers for the benefit of all its creditors.To the complaint appellant put in several defenses: That, after the shipment of said goods, appellant learned of the insolvency of respondent, and retook said goods while still in the warehouse of the common carrier; that respondent had agreed to pay for the goods so sold to it by appellant in cash on delivery, and that respondent did not pay as agreed; that at the time of the purchase of these goods the Friday Canning Company was insolvent; that its insolvency was known to its officers and agents, and unknown to appellant; and that said contract was made, and said goods obtained, with the intention on the part of the Friday Canning Company to defraud appellant, and not to pay it therefor.Appellant also alleged that a few packages of the goods shipped the Friday Canning Company had been removed from the warehouse of the common carrier without its knowledge or consent, and fraudulently, without the payment of freight or payment to appellant.To this answer a general denial was interposed by the plaintiff, and upon the issues thus formed the trial was had.No motion for a nonsuit was made at the time of trial, but, after all the evidence was in, counsel for the defendant challenged the legal sufficiency of all the evidence, and upon one ground alone asked that the court direct a verdict for the defendant.The sole ground of the motion for peremptory instruction was that the title to the goods sold by the defendant to the Friday Canning Company had never passed to the Friday Canning Company under what its counsel assumed to be a conditional sales contract.After hearing the argument on this motion, the court was of the opinion that a verdict should be directed, but that it should be against the defendant, with the right, however, to the defendant to have the amount of the verdict to be rendered fixed by the jury.Under appropriate instructions to that end, the jury retired to consider their verdict, and subsequently returned a verdict in favor of the plaintiff for the sum of $165.From the judgment entered thereon, proper exceptions having been saved, this appeal is prosecuted.

The allegation of the answer as to the sale is that the appellant sold the goods to be paid for in cash on delivery at Stanwood.The proof is that the goods were sold to be paid for on delivery in cash.Nothing was said about delivery at Stanwood.There is no allegation in the answer as to the representations touching the ability and funds on deposit to pay bills, or touching the $4,000 on deposit in the bank.The representations were not an integral part of the contract, and proof concerning them was immaterial, because the goods were to be paid for on delivery.Had these representations been made as means to secure possession of the goods, a different question would arise, under proper pleadings.From the fact that...