Montgomery Moore Mfg. Co. v. Leeth

• Decision Date: 10 June 1909
• Citation: 162 Ala. 246,50 So. 210
• Parties: MONTGOMERY MOORE MFG. CO. v. LEETH.
• Court: Alabama Supreme Court

50 So. 210

162 Ala. 246

MONTGOMERY MOORE MFG. CO. v. LEETH.

Supreme Court of Alabama

June 10, 1909

Appeal from Circuit Court, Cullman County; D. W. Speake, Judge.

Trial of right of property between the Montgomery Moore Manufacturing Company and G. S. Leeth, claimant. From a judgment for claimant, plaintiff appeals. Reversed and remanded.

The following charges were refused to the plaintiff:

"(1) The court charges the jury that if they believe from the evidence in this case that McCutchen told Adams, before Adams turned over the money to McCutchen, that he (McCutchen) was selling his property too cheap, and could not pay his creditors, and that it was wrong to treat them that way, then this would be notice to Leeth, and the sale would be void, and their verdict should be for the plaintiff.

"(2) The court charges the jury that if they believe the evidence in this case they must find that at the time of the sale to Leeth that the defendants made such sale with the purpose and intent to convert their property into money and place it beyond the reach of their creditors.

"(3) The court charges the jury that if the claimant, Leeth, had access to the books of McCutchen & Son, and could have, by examining said books, ascertained that McCutchen & Son were in debt, and he failed to inspect the books, and acquire such information, then Leeth would be chargeable with the notice of such indebtedness.

"(4) The court charges the jury that if they believe the evidence in this case they must find that the defendants McCutchen & Son were insolvent on January 8, 1907."

"(6) The court charges the jury that if Leeth knew of or participated in the fraudulent intent of McCutchen & Son, or was in possession of such facts and circumstances as should have excited his suspicion and put him on inquiry, which, if followed up, would have brought knowledge to him of such fraudulent intent, then he is chargeable with notice, and you should find the issues in favor of the plaintiff.

"(7) The court charges the jury that if they believe the evidence in this case, and you are reasonably satisfied from the evidence that McCutchen told Leeth, before he paid for the property, that McCutchen & Son owed debts which they could not pay, you should find the issues in favor of the plaintiff.

"(8) The court charges the jury that if you are reasonably satisfied on the evidence in this case that the price paid by Leeth to McCutchen, or McCutchen & Son, was greatly disproportionate to the value of the property that he obtained from said McCutchen, or from McCutchen & Son, then I charge you that this fact was sufficient to have excited Leeth's suspicion as to the bona fide intent of said McCutchen & Son; and if Leeth could have, on proper investigation and inquiry, diligently pursued, ascertained that it was the purpose and intent of said McCutchen & Son to convert their property into money so as to put it beyond the reach of their creditors, then under the law said sale is fraudulent and void as to such creditors, and it would be your duty to so declare, and to return a verdict for the plaintiff."

The following charges were given at the request of the plaintiff:

"(1) The court charges the jury that fraud is never presumed, but must be proven by the party asserting it, and it will not be imputed when the facts and circumstances from which it is supposed to arise may reasonably consist with honest contention.

"(2) The court charges the jury that the payment by the claimant to the defendants McCutchen & Son was a valuable consideration, and that the burden was cast upon the plaintiff to prove the existence of a fraudulent intent, and that such fraudulent intent was known to the said claimant at the time of his purchase.

"(3) The court charges the jury that there is no evidence in this case that the books of McCutchen & Son contained a single account of any of their indebtedness.

"(4) The court charges the jury that fraud must be proved by clear and satisfactory evidence, and, when a transaction is susceptible fairly of two constructions, the one which will support and free it from the imputation of impurity of intention will be adopted.

"(5) The court charges that if you believe from all the evidence in this cause that the defendants McCutchen & Son were insolvent at the time of the sale of the goods in controversy to Leeth, the claimant, still, if they further believe from all the evidence in this cause that if the said Leeth paid a reasonably fair price for the same in cash at the time of his said purchase (if they believe he did purchase them) without any such knowledge of their insolvency, and without such information as reasonably to put him on inquiry, then the said purchase is valid, and your verdict must be for said Leeth, no matter how fraudulent was the intent of said McCutchen & Son, the defendants.

"(6) The court charges the jury that if you find from the evidence the claimant gave a fair, adequate consideration for the property in controversy, then I charge you that the burden of proof is on the plaintiff to show a fraudulent intent on the part of the defendants McCutchen & Son in making said sale, and knowledge on part of claimant of that intent, or of facts sufficient to charge him with the notice of the financial insolvency on the part of said McCutchen & Son; and if, on consideration of all the evidence, both of these facts have not been established to your reasonable satisfaction, your verdict must be for the claimant."

Brown & Kyle, for appellant.

F. E. St. John and George H. Parker, for appellee.

SIMPSON J.

The judgment in this case was rendered on September 23, 1907, and the appeal was taken August 28, 1908.

A motion is made to dismiss the appeal because section 2868 of the Code of 1907, which went into effect on May 1, 1908, provides that appeals shall be taken within six months from the rendition of the judgment or decree. We hold that section 10 of the Code of 1907 preserves the right of appeal for the one year provided by section 436 of the Code of 1896. Said section 10 provides that: "This Code shall not affect any existing right, remedy or defense, * * * as to all such cases the laws in force at the adoption of this Code shall continue in force." Poull Co. v. Foy-Hays Const. Co. (Ala.) 48 So. 785. The motion to dismiss the appeal is overruled.

This action is a trial of the right of property. The appellant, as plaintiff, sued out a writ of attachment against P. S McCutchen & Son, levying the same on a stock of merchandise and other personal property which had belonged to the defendant, but which, at the time of the levy, were in the possession of appellee's agent, being removed from Baileyton, Ala., where defendant had been doing business, to Cullman, Ala. where said appellee was doing business. Appellee thereupon interposed his claim to the property, executed bond, and took possession of the property. The insistence of plaintiff is that said McCutchen & Son were in failing circumstances, which was known to the claimant, that the stock of goods was bought for an amount greatly less than its real value, and that said sale was fraudulent and void as to the creditors of said McCutchen & Son; the plaintiff being one of said creditors. The plaintiff took the deposition of P. S. McCutchen, and the seventh interrogatory to said witness was: "Do you think it is wrong for a man to buy goods from a wholesale merchant, and then sell them with the purpose and intention of not paying for them, and then put the money in their pockets, without paying for them?" The witness, for answer to this interrogatory, said: "I never bought the goods with such intention. I never bought them with that intention." Before offering any part of the...