Lehman-Durr Co. v. Griel Bros. Co.

• Decision Date: 15 August 1898
• Parties: LEHMAN-DURR CO. ET AL. v. GRIEL BROS. CO. ET AL.
• Court: Alabama Supreme Court

24 So. 49

119 Ala. 262

LEHMAN-DURR CO. ET AL. v. GRIEL BROS. CO. ET AL.

Supreme Court of Alabama

August 15, 1898

Appeal from chancery court, Conecuh county.

Bill by the Griel Bros. Company and others against the Lehman-Durr Company and others. From an order appointing a receiver, and a decree overruling defendants' motion to dismiss the bill for want of equity, refusing to dissolve the injunction and overruling certain grounds of a demurrer, defendants appeal. Reversed in part.

The bill sought to have certain mortgages and transfers made by M. W. Etheridge & Son to other defendants, together with certain attachments against Etheridge & Son, obtained by some of the defendants, all declared to be a general assignment for the benefit of all the creditors of Etheridge & Son. The bill also asked for a receiver, and for an injunction against defendants, restraining them from further prosecution of the attachment suits, and from collecting or interfering with the status of the property covered by the mortgages, transfers etc., set out in the bill. The substantial allegations of the bill were that M. W. Etheridge & Son, being then indebted to complainants, owned $13,000 worth of choses in action, a large stock of goods, etc., with furniture and fixtures, and also several described lots of real estate; that M. W Etheridge & Son, prior to January 1, 1897, were indebted to defendant Lehman-Durr Company, and subsequently (time not specified) executed to them $5,000 of accounts, all as security for the debt. It was also alleged that, being indebted to G. E. Crawford & Co., the defendants Etheridge &amp Son, at a time not stated, transferred to them, as security for the debt, $5,000 of choses in action; and also that being indebted to the Alabama Fertilizer Company, defendants Etheridge & Son transferred to it as security $3,000 worth of choses in action (time of transfer not stated); and then it is alleged that on April 28, 1897, defendants Vandiver & Co. and Lehman-Durr Company had attachments levied on the stock of goods, furniture, and fixtures of Etheridge & Son. It is alleged that the said attachments "were procured by said Etheridge & Son," and that the property covered by the mortgages, transfers, and attachments was substantially all the property of Etheridge & Son subject to process for the collection of debts, and prays that all the sundry transfers, mortgages, and attachments referred to be held as one transaction, and be declared a general assignment. The bill fails to allege any collusion, connection, or preconceived design between the parties, or either of them, that any one transfer or mortgage should be followed by another, or by the attachments. The bill also fails to aver that any other defendant knew, or had reason to believe, that Etheridge & Son were insolvent; and fails to show that any defendant was insolvent, and unable to meet any judgment that might be secured against him. The prayer of the bill was that the several transfers and mortgages, and the suing out of the said writs of attachments, be adjudged a general assignment; that a receiver be appointed to take possession of all the property, and collect the amounts due, as shown by the choses in action transferred, and the rents from the said real estate; and that an injunction be issued restraining the several defendants from the collection of the choses in action transferred to them, and also from the further prosecution of the attachment suits.

Under this bill, the chancellor, in vacation, on May 18, 1897 without notice to defendants, appointed a receiver for all property which any or all defendants had received of Etheridge & Son, or covered by their mortgages or transfers, as well as for the property covered by the attachments. He also issued an injunction restraining further prosecution of the attachment suits, and also restraining defendants from collecting the choses in action transferred to them, or enforcing the mortgages. This injunction was issued without bond. Thereafter the several defendants, respectively, moved the chancellor to dismiss the bill for the want of equity, and also filed a motion to vacate and set aside the order appointing the receiver, to dissolve the injunction, and to discharge the injunction. The defendant Lehman-Durr Company also demurred to the bill upon the following grounds: (1) "The said bill seeks to have various and sundry transfers of certain personal property made by M. W. Etheridge & Son to various and sundry defendants, mentioned in said bill, declared a general assignment, but fails to show that the transfer to either of said parties was substantially all the property of the said M. W. Etheridge & Son." (2) "The said bill seeks to have various and sundry transfers of certain personal property made by M. W. Etheridge & Son to various and sundry defendants, mentioned in said bill, declared a general assignment, but fails to show that there was any common purpose or design on the part of the various assignees of said property, or that either of said assignees had any knowledge of the several other transfers made by M. W. Etheridge & Son." (3) "It doth clearly appear in and by the averments of said bill that the respective transfers of the said choses in action by the said Etheridge to this defendant, and to the said Crawford & Co., and the said Alabama Fertilizer Company, and the suing out of said attachments, were separate and independent transactions, having no connection one with the other, and involving separate and distinct property; and it doth appear that neither one of said transactions was a sale, conveyance, transfer, or disposition of all, or substantially all, of the property of the defendants Etheridge & Son." (4) "That said bill fails to show any common knowledge, or collusion, or understanding, or design between the assignees of said choses in action, or between any one or more of them, or between said assignees or any one or more of them and W. F. Vandiver & Co. and this defendant, the attaching creditors mentioned in said bill, that said transfers of said choses in action, the execution of said mortgage, and the suing out of said attachments should be made or accomplished as alleged in said bill." (5) "That it doth not appear in and by the averments of said bill that the suing out of said attachments by this defendant and W. F. Vandiver & Co. was part or parcel of, and had any connection with, the transfers of said choses in action." (6) "That it doth not clearly appear in and by the averments of said bill that at the time of the transfer of said choses in action it was a transfer of substantially all of the property of the said M. W. Etheridge & Son." (7) "That it doth clearly appear in and by the averments of said bill that the transfer of said choses in action, and the execution of said mortgage, was not a transfer or conveyance of all, or substantially all, of the property of the said M. W. Etheridge & Son, then owned by them." (8) "That it doth not clearly appear in and by the averments of said bill that at the time of said transfer of said choses in action that the...