Meadowcraft v. Walsh

• Decision Date: 01 April 1895
• Citation: Meadowcraft v. Walsh, 15 Mont. 544, 39 P. 914 (Mont. 1895)
• Parties: MEADOWCRAFT et al. v. WALSH.
• Court: Montana Supreme Court

39 P. 914

15 Mont. 544

MEADOWCRAFT et al. v. WALSH.

Supreme Court of Montana

April 1, 1895

Appeal from district court, Lewis and Clarke county; Horace R. Buck Judge.

Action by Robert Meadowcraft and others against Lawrence Walsh upon promissory notes. From an overruling of a motion for a new trial, and a judgment in favor of plaintiffs, defendant appeals. Affirmed.

Action by plaintiffs to recover amounts due on four promissory notes made by defendant. One note, for $110, and interest, was made and delivered May 1, 1885, to the firm of Jurgens & Price. To escape the statute of limitations, plaintiffs plead the payment on said note of $25, made December 8, 1890. Another note, made February 8, 1888, was delivered to one Dennis Hayes, who transferred it to Jurgens & Price. The third and fourth notes sued on were delivered to Jurgens & Price. All the notes were indorsed by Jurgens & Price, after maturity in blank, before suit, and transferred to plaintiffs, who are the actual holders thereof. Defendant denied the transfer of the May, 1885, note, denied the indorsement thereon, and pleads the statute of limitations as a bar to a recovery. He denied that any of the other notes were transferred by Jurgens & Price to plaintiffs before suit, or that plaintiffs ever owned the said notes. By replication plaintiffs denied the bar of limitations as to the first note. Plaintiffs bankers in Chicago, became the holders of the notes by discounting them for one R. P. Price, a brother of Bennett Price, of the firm of Jurgens & Price, on August 26, 1891. They were discounted when first presented, and have never been out of plaintiffs' possession, except when sent for collection to Helena. Plaintiffs, in discounting the notes knew nothing of the insolvency of Jurgens & Price, the assignors. The note of May, 1885, had a payment indorsed thereon of $25, in 1890. Jurgens & Price made an assignment for the benefit of their creditors to S.E. Atkinson, June 7, 1889. The notes were indorsed by Price, in the name of the firm, in August, 1891, in Chicago, and were sold by Bennett Price to R. P. Price, his brother, for $500. The notes were never delivered to the assignee, Atkinson, in person, although they were in the safe of Jurgens & Price just about the time of the assignment. Bennett Price testified for defendant that Casey, his attorney, he thought, delivered these notes in suit to Dave Price, a nephew of witness, to keep safely. The notes were in the safe of Jurgens & Price on the day of the assignment, and the safe was in charge of Dave Price, who had been in the firm's employ, and who continued in the assignee's service. The notes were in one drawer, where witness had his papers. Witness claimed that he always had had the notes in this possession, and that these notes were his individual property, and not the property of the firm of Jurgens & Price. They were left with Dave Price for safe-keeping, and witness took them from the safe himself on the evening of the assignment. They may have been with other notes that belonged to the firm. Witness had the keys and combination of the safe, and did not deliver the keys to the assignee. No entry was ever made on the books of Jurgens & Price concerning these notes. On rebuttal, witness testified that he took these notes out of the safe of Jurgens & Price before the assignment was completed, considering them his individual property, and delivered them to his individual property, and delivered them to his attorney that evening. The attorney delivered them to Dave Price for safe-keeping. J. H. Jurgens, called by the defendant, testified that what was found of the partnership effects and property after the execution of the assignment was turned over to the assignee with the papers of the assignment. There was no understanding that one partner was to bind the other after that, and no formal notice of dissolution. Witness knew but little of the Walsh notes. Had seen them. Did not know of the notes being turned over to the assignee, or where they were. The firm notes were kept in the safe. Dave Price, a nephew of Bennett, represented the assignee after the assignment. Had the keys to the safe, although there were other keys. On cross-examination he testified that neither of them ever did any act with the intention of dissolving the firm. In response to questions by the court, Jurgens said: "I did not know of the transfer of these notes. I think I knew of these notes being withheld from the assignee, and that Price had such papers. I have never received any benefit from the notes. The firm is not now in existence. Mr. Price had more in the firm than I had. I never objected to Price assigning these notes. I was perfectly willing he should. I first learned about these notes when they were sent out here for collection. Walsh told me. That was the first knowledge I had that Price had transferred the notes. It might be that Price told me that he had transferred them, but I paid no attention to it, because he and Walsh had dealings together. I was perfectly satisfied with whatever Price did in the matter. He sacrificed some individual property by the assignment." There was testimony on behalf of defendant denying his consent to the credit of $25 on the May, 1885, note; and evidence proving that the indorsement made allowing said credit, and the indorsements on the said notes of the firm name of Jurgens & Price were all in violet ink, and that in the lifetime of Casey, attorney for Price, violet ink was used in the office of Casey & Smith, attorneys; but Bennett Price denied that the indorsements were made at the same time, or that there was any wrongful act done by him. Special issues were submitted to the jury, wherein they found that the indorsement of $25 was made in obedience to the agreement between Walsh and Price; that the notes in suit were not in the Jurgens & Price safe at the time the assignee of Jurgens & Price took possession thereof; that the notes were never in the possession of the assignee in person or by agent after the assignment. A general verdict was also rendered for plaintiffs. The defendant moved to set aside the verdict and findings and for a new trial. This motion was overruled. Judgment was entered for plaintiffs. Defendant appeals from the judgment and from the order denying the motion for new trial.

Alex. C. Botkin and Theo. Shea, for appellant.

Henry C. Smith, for respondents.

HUNT J. (after stating the facts).

An attentive examination of the testimony in this record fails to satisfy us that the findings of fact are against the weight of evidence. By the authority of this court they must therefore stand as approved by the trial judge. The issue of the statute of limitations is at once disposed of by the fact that on December 20, 1890, defendant was given a credit of $25, with his consent, on the note of May, 1885. The assignment for the benefit of creditors made by Jurgens & Price on June 7, 1889, included "*** promissory notes debts, choses in action, etc., belonging to said parties of the first part (Jurgens & Price), or either of them, *** now due or payable or to become payable." Under its provisions it was the duty of Price, as a member of the insolvent firm, to deliver to the assignee, for the benefit of creditors, the notes involved in this action, and, failing to do so, doubtless the assignee could have brought suit in trover to recover them from him. The appellant's authorities sustain this proposition. Cooper v. Perdue (Ind. Sup.) 16 N.E. 140; Burrows v. Keays, 37 Mich. 430. But, as the case is presented, the assignee never received the notes, and never made demand upon either member of the firm of Jurgens & Price for them. Ben Price retained them in his possession until 1891, when they passed into the hands of these plaintiffs as innocent purchasers for a valuable consideration. Whether Price's conduct in failing to deliver the notes to Atkinson, assignee of the firm of Jurgens & Price, was intentionally wrong, is a close question, but, as its determination depended upon the credibility of the witnesses, we cannot say that bad faith characterized his conduct. The apparent acquiescence of the assignee in Price's claim to the notes for so long a time, and the fact that he has not intervened in this suit, tend to prove that the assignee neither asserted title to the notes nor claimed any legal ownership of them. These facts also tend to sustain the bona fides of Price. But appellant argues Ben Price could not transfer the note, because, by virtue of the assignment of Jurgens & Price in 1889, the firm of Jurgens & Price was dissolved. To support this contention appellant cites several cases which hold that a general assignment by a firm for the benefit of creditors by itself works a dissolution of the copartnership. Williston v. Camp, 9 Mont. 89, 22 P. 501, did not positively decide the point, but, as we construe the opinion of Justice De Wolfe in that case, the court lean to the doctrine that an assignment by a firm does not necessarily dissolve the copartnership, but...