Pue v. Wheeler
| Decision Date | 19 March 1927 |
| Docket Number | 6015. |
| Citation | 255 P. 1043,78 Mont. 516 |
| Parties | PUE v. WHEELER et al. |
| Court | Montana Supreme Court |
Appeal from District Court, Silver Bow County; George Bourquin Judge.
Action by Galen D. Pue against B. S. Wheeler and another. Judgment for plaintiff, and defendants appeal. Affirmed.
Canning & Geagan, and Rotering & McDaniel, all of Butte, for appellants.
Maury & Brown, of Butte, for respondent.
Upon motion for rehearing, in this case, the original opinion heretofore delivered, is withdrawn, and the following is substituted as the opinion of the court This is an action to recover on an undertaking. January 3, 1922, Galen D. Pue, plaintiff herein, instituted in the district court an action on debt against one H. K. Bushnell and, at the same time, obtained a writ of attachment against the property of Bushnell. The sheriff immediately served the writ by attaching certain personal property of Bushnell's. Bushnell, as defendant, then appeared in the action and, the 4th of January, 1922, a written undertaking in the sum of $1,900, for the release of the attached property, was executed by B. S. Wheeler and M. S. Galasso, defendants herein, and was presented to and approved by Pue's attorneys. It was then given to the sheriff, and he released from attachment and restored to Bushnell's possession all of the attached property. April 6, 1922, Bushnell filed in the United States District Court a petition in bankruptcy. The next day, by decree of that court, he was duly decreed and adjudged a bankrupt. June 18, 1923, he was discharged in bankruptcy of all his provable debts. January 17, 1924, Pue recovered judgment in his action against Bushnell. Later, that judgment was affirmed, on appeal, in this court. None of the attached property was ever returned to the sheriff and no part of the value thereof has been paid to Pue. Pue's judgment against Bushnell is wholly unpaid.
Pue, the plaintiff herein, brought this action against Wheeler and Galasso, defendants herein, to recover of them, on their undertaking, hereinbefore mentioned, the sum of $1,900. His amended complaint recites the foregoing stated facts and alleges the amount of his judgment against Bushnell to be $1,950.70, and that he is still the owner and holder of it; that the value of the attached property was in excess of $1,900; that no execution had been issued against Bushnell because to issue one would have been useless; that demand, without avail, had been made of defendants for delivery of the released property to the sheriff or payment of the amount of their undertaking. Defendants respectively demurred, generally and specially, to the amended complaint. Their demurrers were overruled. They then put in separate identical answers. Each answer, in substance, pleaded five defenses:
(1) The bankruptcy of Bushnell; claiming his adjudication, within four months of the attachment, as a bankrupt, rendered null and void the attachment and relieved defendants of liability on their undertaking for release of the attached property.
(2) That, by virtue of an earlier judgment in another action, previously obtained by Pue against Bushnell and still held by Pue, after the release of the attached property, Pue caused all of the released property to be levied on, under a writ of execution, and sold, and thus prevented the return of the released property, to be subjected to the judgment in the attachment suit.
(3) That, by virtue of the levy just mentioned, the released property had become repossessed by the sheriff (the official who released the attachment and who made the subsequent levy being the same), and thus the requirement of the undertaking had been fulfilled.
(4) A failure of consideration for the undertaking.
(5) That, in the attachment suit, Pue had filed in court an offer of perpetual stay of execution against Bushnell, which was accepted by Bushnell.
Plaintiff replied to each answer. The pleadings, as shown by the record, are in bad condition. Plaintiff's reply is most confusing. It undertakes to reply, so it says, to certain affirmative defenses of the answer, and then makes no reply to them, but apparently proceeds to reply to other portions of the answer. It purports to reply to a fourth affirmative defense, when there is none. However, the reply, even in its confused condition, admits certain allegations of the answer and, at the end, contains a general denial of all allegations of the answer not specifically admitted, which is sufficient to frame issues for the case.
The case was tried to a jury. Defendants objected to the introduction of any evidence in behalf of plaintiff, moved for judgment on the pleadings, moved to dismiss the action; and, when plaintiff rested, moved for judgment of nonsuit. All were overruled. The jury returned a verdict in the sum of $1,756.46 for plaintiff. Judgment was rendered accordingly. Defendants moved for a new trial; motion overruled. Defendants appealed from the judgment and assign twenty specifications of error. Several of them attack the amended complaint. We first consider them.
The demurrers to the amended complaint assign, as grounds of demurrer, that it does not state facts sufficient to constitute a cause of action, and that it is uncertain in several particulars; likewise, ambiguous and unintelligible. Objection to introduction of evidence and various motions were substantially to the same effect. We hold that the amended complaint states a cause of action. That it does is obvious. Objections, raised by demurrer, that the amended complaint is uncertain and ambiguous may not be considered upon appeal. By answering, after being overruled on such objections, taken by demurrer, defendants waived those objections. Lynch v. Bechtel, 19 Mont. 548, 48 P. 1112. By analogy, the objection, taken by demurrer, that the amended complaint is unintelligible, must likewise fall. Manifestly, though, it is intelligible enough to state a cause of action.
We now take up defendants' first defense, i. e., the claim that Bushnell's adjudication, within four months of the attachment of his property, as a bankrupt, under and by virtue of section 67f of the federal Bankrupt Act of 1898 (U. S. Comp. St. § 9651), rendered null and void the lien of the attachment and relieved defendants of liability on their undertaking, and their specifications of error relating thereto. We consider that the outstanding question of this case.
So much of section 67f, supra, as it is necessary to set forth, is as follows:
"That all levies, judgments, attachments, or other liens, obtained through legal proceedings against a person who is insolvent, at any time within four months prior to the filing of a petition in bankruptcy against him, shall be deemed null and void in case he is adjudged a bankrupt, and the property affected by the levy, judgment, attachment, or other lien shall be deemed wholly discharged and released from the same, and shall pass to the trustee as a part of the estate of the bankrupt."
This applies to voluntary, as well as involuntary, petitions in bankruptcy. In re Richards (C. C. A.) 96 F. 935; Cavanaugh v. Fenley, 94 Minn. 505, 103 N.W. 711, 110 Am. St. Rep. 382; McKenney v. Cheney, 118 Ga. 387, 45 S.E. 433.
Counsel for defendants contend that the mere adjudication of Bushnell to be a bankrupt related back to the date of the attachment and nullified the attachment. In the oral argument of this case, upon appeal, as well as in the briefs then submitted, the question of whether or not it was necessary, to annulment of the attachment lien, for Bushnell to have been insolvent at the time the attachment was made, and whether or not, as a defense, it was necessary to plead and prove, in addition to his adjudication as a bankrupt, that he was insolvent at the time of the attachment, was not suggested, raised, or discussed. No reference to it was made. No authorities were cited. There was no contention about it, one way or the other. Hence, it was not considered. It is, however, a proper issue under the pleadings and a vital question in this case. Upon motion for rehearing, it is raised and discussed, and the court's attention is invited to it.
The great weight of authority, well-nigh uniform, holds that it is essential to annulment of the attachment lien that the party who, within four months of attachment of his property is adjudged a bankrupt, must, at the time of the attachment, have been insolvent, and that, if it is not so alleged and proven, the attachment lien remains valid and undisturbed, so far as the bankruptcy proceedings concern it. 7 C.J. 197; Loveland on Bankruptcy, par. 192c; Collier on Bankruptcy (3d Ed.) 434; 2 Remington on Bankruptcy, par. 1460; Brandenberg on Bankruptcy, pars. 870 and 885; In re Friedman, 1 Am. Bankr. Rep. 510; Levor v. Seiter, 34 Misc. 382, 69 N.Y.S. 987, 5 Am. Bankr. Rep. 576; Hardt v. Schuylkill, 8 Am. Bankr. Rep. 481; Dunn Salmon Co. v. Pillmore, 55 Misc. 546, 106 N.Y.S. 88, 19 Am. Bankr. Rep. 172; Keystone Brewing Co. v. Schermer, 241 Pa. 361, 88 A. 657, 31 Am. Bankr. Rep. 279; In re Rhoads (D. C.) 98 F. 399; Simpson v. Van Etten (C. C.) 108 F. 199; In re Chappell (D. C.) 113 F. 545; Stone-Ordean-Wells Co. v. Mark (C. C. A.) 227 F. 975; Martin v. Oliver (C. C. A.) 260 F. 89; In re Ann Arbor Mach. Co. (D. C.) 278 F. 749; D. C. Wise Coal Co. v. Col. Zinc Co., 157 Mo.App. 315, 138 S.W. 67; Pinkard v. Willis, 24 Tex.Civ.App. 69, 57 S.W. 891; Danby Millinery Co. v. Dogan, 47 Tex.Civ.App. 323, 105 S.W. 337; Texas Fidelity & Bonding Co. v. First State Bank (Tex. Civ. App.) 149 S.W. 779; Jackson v. Valley Tie Co., 108 Va. 714, 62 S.E. 964; Newberry Shoe Co. v. Collier, 111 Va. 288, 68 S.E. 974. Citation of cases so holding might be greatly extended, but it is not necessary to cite more. ...
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