Nelson v. Ruthkowski
| Decision Date | 28 March 1929 |
| Docket Number | No. 27179.,27179. |
| Citation | 177 Minn. 84,224 N.W. 457 |
| Parties | NELSON v. RUTHKOWSKI et al. |
| Court | Minnesota Supreme Court |
Appeal from District Court, Roseau County; Andrew Grindeland, Judge.
Action by E. H. Nelson, trustee in bankruptcy for Peter Ruthkowski, against Peter Ruthkowski and another. Judgment for plaintiff and defendants appeal. Affirmed.
Lemke & Weaver, of Fargo, N. D., for appellants.
M. J. Hegland, of Roseau, and A. N. Eckstrom, of Warren, for respondent.
Appeal by defendants from a judgment decreeing that the chattel mortgage described in the complaint was fraudulent and void and of no effect as to plaintiff, and that the property therein described was free from any lien or incumbrance on account of said mortgage.
The defendants, Peter Ruthkowski and Stanley Ruthkowski, aged, respectively, 60 and 26 years, are father and son. Plaintiff is the duly appointed and qualified trustee in bankruptcy of defendant Peter. On May 10, 1927, Peter was the owner and in possession of 54 head of cattle described in the chattel mortgage. On that date he drove 50 miles to a city in another county and there executed a chattel mortgage to defendant Stanley purporting to secure the payment of three notes that day given in the sum of $1,960 (payable $600 on December 1, 1927, $600 December 1, 1928, and $760 December 1, 1929), each bearing interest at 5 per cent. per annum. This mortgage was duly filed by Peter on the next day in the office of the register of deeds of Roseau county, Minn. The mortgage so given was not accompanied by any delivery of the property described therein or followed by any actual or continued change of possession thereof; the mortgagor remaining in possession. He was, at the time of the execution and delivery of said chattel mortgage, indebted to numerous persons in various amounts, none of which have been paid. The case was tried to the court, which found the facts substantially as above recited; there was a further finding that the mortgage was not executed in good faith but was for the purpose of delaying, hindering, and defrauding creditors, and that the mortgagee therein, the defendant Stanley, had knowledge thereof.
The theory of the defense was that Stanley had been working for his father on the farm since reaching his majority, a period of over four years, for which he was to receive $35 per month. The amount named in the chattel mortgage would be the full amount of wages at that rate; it appears that the father had given the son various sums of money at different times, aggregating over $200. After the mortgage was executed, the father sold the milk from the cows described therein, receiving $140 to $180 in cream checks each month. He also sold $700 worth of cattle, whether they were those covered by the mortgage does not appear.
After giving the mortgage, Peter incurred a large number of bills locally, which remain unpaid, paid another son $500 and a daughter $371, and paid to Stanley $280, the latter being ostensibly on one of the notes above described. Four months and eleven days after the execution of the chattel mortgage, Peter filed a petition in bankruptcy. Peter was vice president and director of the People's State Bank of Greenbush, which closed the day before the chattel mortgage was given. In addition to his stockholders' liability on five shares, he had heavy liabilities as surety and guarantor.
Two financial statements,...
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