Metropolitan Life Ins. Co. v. Pollack

• Decision Date: 02 May 1955
• Citation: 332 Mass. 582,126 N.E.2d 373
• Parties: METROPOLITAN LIFE INSURANCE COMPANY v. Herman C. POLLACK and others.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 373

126 N.E.2d 373

332 Mass. 582

METROPOLITAN LIFE INSURANCE COMPANY v. Herman C. POLLACK and others.

Supreme Judicial Court of Massachusetts, Suffolk.

Argued Feb. 9, 1955.

Decided May 2, 1955.

Barnard Kaplan, Isidore M. Libman & Lester S. Cramer, Boston, for plaintiff.

Alfred Sigel, M. Brackman, Boston, for defendants.

Before QUA, C. J., and WILKINS, SPALDING and WILLIAMS, JJ.

WILLIAMS, Justice.

This is a bill in equity by a judgment creditor of the defendant Herman C. Pollack to reach and apply in payment of his indebtedness shares of the corporate stock in two Massachusetts corporations, Adams Motors, Inc., and Granite Gallivan Realty Corp., of which he is alleged to be the owner. The bill was filed on December 15, 1952. By supplemental bill filed by leave of court February 5, 1953, in which Antoinette, the wife of Herman, is joined as a party defendant, it is alleged that certain of the shares referred to in the bill have been transferred to her with the intent to hinder, delay, and defraud the creditors of Herman.

The evidence and findings of material facts are reported. From these findings it appears that the plaintiff has an unsatisfied judgment against Herman in the amount of $4,549.50 entered in the Supreme Court of New York on December 8, 1933. In 1945 Herman, to whom hereinafter we shall refer as the defendant, with one Goldman and others negotiated with the Chrysler Corporation for a Dodge automobile agency in Boston. A promise of the franchise for the agency having been obtained, Adams Motors, Inc., was organized in December of that year with capital stock of 750 shares preferred and 750 shares common. Three hundred shares of each class were issued to the defendant and the balance of the shares to Aaron J. Rosenberg, William A. Mason, and Thomas P. Bain. To obtain the agency franchise 'it had to be made to appear' that the defendant had a substantial interest in the corporation and was to give his full time to the business. 'Consequently, all the papers, documents and records were made to so appear, and * * * the defendant so acted as to give color thereto.' To assist in carrying on the business of Adams Motors, Inc., Rosenberg, Mason, and Bain organized Granite Gallivan Realty Corp. in January, 1946. Its stock was all common and of the 750 shares 300 were issued in the name of the defendant. No money of the defendant was used in the issuance or purchase of any shares of stock issued in his name in either corporation. The money so used belonged to his wife or had been lent to her. '[A]ll concerned knew the situation, and * * * it was intended from the beginning that the shares of stock standing superficially on the record in the name of the defendant * * * belonged to his wife * * * and to others who had advanced money therefor. * * * [P]rior to the bringing of this bill such shares of stock which had been in the name of the defendant had been transferred as a matter of record to the lawful owners thereof, and * * * there were no shares in the defendant corporation[s], either standing in the name of a or owned by the defendant when this bill was brought.'

'No excise stamp was procured, affixed to, or cancelled from the transfers of the certificates of the stock from the name of the defendant * * * to his wife * * * and to other real owners thereof.'

The judgment found that the acts described were not in fraud of the defendant's creditors.

A final decree was entered dismissing the bill with costs and the plaintiff appealed.

A careful examination of the exhibits and the testimony leads to the conclusion that the findings of the judge were not plainly wrong. It is peculiarly a case where the accuracy of the findings depends upon the credibility of the oral testimony and where the conclusions of the judge who saw and heard the witnesses must be given due weight. Boston v. Santosuosso, 307 Mass. 302, 331-332, 30 N.E.2d 278. There was evidence that the defendant, who had been a practising attorney in New York, lost his money in the financial depression of the...