Raalte v. Harrington
| Decision Date | 17 November 1890 |
| Citation | 14 S.W. 710,101 Mo. 602 |
| Parties | Van Raalte, Appellant, v. Harrington |
| Court | Missouri Supreme Court |
Appeal from St. Louis City Circuit Court. -- Hon. Shepard Barclay Judge.
Reversed and remanded.
Alexander Martin and J. S. Laurie for appellant.
(1) The refusal of the trial court to submit special issues to the jury as prayed by plaintiff constitutes reversible error. R S. 1889, secs. 6594, 6596, 6598; Commonwealth v Desmond, 123 Mass. 407; Rogers v. Railroad, 35 Mo. 153; State v. Proctor, 90 Mo. 334; State v. Railroad, 32 F. 722; Jennings v. Cutler, 12 Kan. 500; State v. Crawford, 11 Kan. 32; Powers v. Kneckhoff, 41 Mo. 425; Marmaduke v. McMasters, 24 Mo. 51. (2) The instructions given by the court disregard the issue of actual fraud made by the pleadings and submit the case to the jury on an erroneous theory. Fraser v. Passage, 63 Mich. 551; Carroll v. Hayward, 124 Mass. 120; Coolidge v. Heneky, 11 Or. 327; Parker v. Conner, 93 N.Y. 118; French v. Reed, 70 Ia. 122; Shroeder v. Walsh, 120 Ill. 403; Catchings v. Harcrow, 49 Ark. 20; Cook v. Cook, 43 Md. 523; Dougherty v. Cooper, 88 Mo. 602; Frederick v. Allgaier, 88 Mo. 602; Sexton v. Anderson, 93 Mo. 373; Hamilton v. Marks, 63 Mo. 167. (3) The court by refusing instructions as prayed for by plaintiff denied him his proper attitude as purchaser for value and placed him in a false light before the jury. Instruction number 10 is proper in form and elementary in principle. Albert v. Besel, 88 Mo. 150; Jones v. Simpson, 110 U.S. 609; Schroeder v. Walsh, 120 Ill. 403; Shelley v. Booth, 73 Mo. 74; Sexton v. Anderson, 95 Mo. 379; Levey v. Adler, 97 Mo. 413; Ryan v. Young, 79 Mo. 30; Holmes v. Braidwood, 82 Mo. 610. (4) There is no evidence to support the verdict. Hipsley v. Railroad, 88 Mo. 348; Hearns v. Keith, 63 Mo. 84; Lomer v. Meeker, 25 N.Y. 361; Evans v. George, 80 Ill. 51; Lionberger v. Pohlman, 16 Mo.App. 392; Hausman v. Hope, 20 Mo.App. 193; Waddingham v. Loker, 44 Mo. 132; Funkhouser v. Lay, 78 Mo. 458; Priest v. Way, 87 Mo. 16; State v. Primm, 98 Mo. 373. The burden of proof was on defendant to establish notice, and, there being a total and absolute failure of evidence on the point, the verdict should not be permitted to stand. Hearn v. Keith, 63 Mo. 84; Whitsett v. Ransom, 79 Mo. 258; Spohn v. Railroad, 87 Mo. 74; Chandler v. Fleeman, 50 Mo. 237; Dunn v. Dunnaker, 87 Mo. 597. (5) There was no evidence tending to show the market value of the goods at the date of the trial.
Lee & Ellis, David Goldsmith and Albert Arnstein for respondent.
(1) The court committed no error in refusing to submit the special issues; the questions submitted under the law of 1885 should be material issues made by the pleadings. Flannery v. Railroad, 23 Mo.App. 120; Turner v. Railroad, 23 Mo.App. 12; Chicago v. Dunlevy, 22 N.E. 15; Blake v. Davis, 20 Ohio 231; Benton v. Railroad, 25 Mo.App. 155; Jackson v. Ins. Co., 27 Mo.App. 62. (2) The theory upon which the issue of fraud was submitted to the jury was the correct one. There is unquestionably a direct conflict among the authorities as to whether or not a vendee must have actual knowledge of the vendor's fraudulent intent or whether constructive notice will suffice. In this state the law is settled in favor of the latter theory. Rupe v. Alkire, 77 Mo. 641; State v. Estell, 6 Mo.App. 6. The following authorities support this view: Blum v. Simpson, 66 Tex. 84; 71 Tex. 628; Hooser v. Hunt, 65 Wis. 71; Bedford v. Penny, 58 Mich. 424; Bollman v. Lucas, 22 Neb. 796; Dyer v. Taylor, 50 Ark. 314; Hoy, etc., Co. v. Turner, 85 Ala. 465; Beddenger v. Weland, 67 Md. 359; Thompson v. Duff, 19 Bradw. (Ill.) 78; Spaulding v. Adams, 63 Ia. 437; Gollober v. Martin, 33 Kan. 255; Wells v. McMahon, 18 P. 73; Moore v. Williamson, 15 A. 587; Wood v. Elliott, 7 S.W. 624; The Holladay Case, 27 F. 830; Bartles v. Gibson, 17 F. 297; Singer v. Jacobs, 11 F. 559. The text-writers also support this view: Wait on Fraud. Con. [2 Ed.] sec. 379, et seq.; Bump on Fraud. Con. [3 Ed.] pp. 201, 202; Bigelow on Fraud, pp. 386, 387; Kerr on Fraud and Mistake [2 Ed.] pp. 246, 247. Besides appellant's own instructions are framed on the same theory and he cannot now object to the form in which the issue of fraud was submitted to the jury. Bettes v. Magoon, 85 Mo. 580; Thorpe v. Railroad, 89 Mo. 650; Noble v. Blount, 77 Mo. 235; Bank v. Hammerslough, 72 Mo. 274; Smith v. Culligan, 73 Mo. 387; Loomis v. Railroad, 17 Mo.App. 340; Straat v. Hayward, 37 Mo.App. 585.
OPINION
-- This is a controversy over a stock of merchandise consisting of dry goods, notions, clothing, hats and caps, and boots and shoes. Adolph Lederer being the owner and in possession of the goods sold the same to Samuel Van Raalte who took immediate possession. Thereupon the defendant, as sheriff of St. Louis, levied upon the property by virtue of several writs of attachment sued out by the mercantile creditors of Lederer. Van Raalte then commenced this action of replevin, gave bond and reacquired possession. The sheriff defends on the ground that the sale was one made in fraud of creditors and that plaintiff purchased with full knowledge of the intended fraud.
Plaintiff was a pawnbroker and dealer in jewelry and to a limited extent in other merchandise at Fourth street in the city of St. Louis; he had associated with him his stepfather, Julius Van Raalte, as a partner in the profits of the business. Lederer carried on a mercantile business at Chouteau avenue in the same place. The evidence of plaintiff and of Julius Van Raalte is, that Lederer came to their store and proposed to sell his entire stock of goods, saying he was old, feeble and not capable of transacting business; that he wanted to sell out, straighten up his affairs and quit business. Julius Van Raalte examined the goods and made a report to the plaintiff, and the parties then commenced taking an invoice. All this occurred on the second of October, 1886.
The invoice, which amounted to something over eleven thousand dollars, at cost prices, was completed on the sixth of the same month. Lederer then offered to take seventy-five cents on the dollar, and Julius Van Raalte offered sixty-five, and the trade was closed at the last-named price. The parties then went to the Fourth-street store, where plaintiff paid seventy-two hundred and thirteen dollars, for the goods in cash over the counter, and Lederer gave to the plaintiff full and complete possession of the property. Subsequently Lederer paid from the proceeds arising from the sale a note due at bank for five hundred dollars on which his son-in-law was surety. He paid to his son Emil, a young man twenty-eight years of age, forty-eight hundred dollars, and to his other son Samuel, twenty-two years old, fifteen hundred dollars. He applied about two hundred dollars in payment of other debts. The evidence of the Lederers is that the father owed the sons the above-named amounts for services and for moneys advanced. A few days before the sale to plaintiff, Lederer turned over to a son-in-law goods costing three thousand dollars to secure a debt of two thousand dollars. These goods were placed in an auction house, and were subsequently sold to pay that debt. The above transactions left Lederer without property, and owing the attaching creditors some ten thousand dollars for goods purchased on time for the fall trade, the bills not being due at the date of the sale to plaintiff.
Plaintiff says he had contemplated extending his business, so that the purchase was in line with a previously formed design. A few days after he opened the Chouteau-avenue store, he removed goods invoiced at fourteen hundred and sixty-three dollars to the Fourth-street store and sold the remainder of the new purchase at auction; the goods thus sold realized something in excess of the price paid therefor. The change in the plaintiff's design to extend his business is accounted for on the ground of his ill health.
When the trade was consummated, plaintiff called in his attorney who prepared and Lederer signed and acknowledged a bill of sale. Inquiries were then made of Lederer as to his title to the goods, and of his wife whether she had any interest therein, but no inquiries were made as to the extent of the vendor's indebtedness. Plaintiff says he did not know that his vendor was indebted to the attaching creditors, or to any other person.
The Chouteau-avenue store was kept open while the parties were taking the invoice, and goods which arrived during that time were not included therein. There is some evidence to the effect that goods were shipped from the store during that time, and there is much evidence to a contrary effect. Lederer held a lease upon his store premises, and he and his son appear to have been designated as lessees. This lease was transferred to the plaintiff who leased the second story of the building to Lederer where the latter, his wife and two sons continued to reside as before the sale to plaintiff. Some time previous to this sale one of the sons of Lederer had worked for the plaintiff at his Fourth-street store. There are some other circumstances in evidence which we deem it unnecessary to recite.
1. The point urged with so much confidence by the plaintiff, who is the appellant, that there is no evidence tending to show that Lederer intended to defraud his creditors cannot be sustained. Lederer, it is true, had a right to prefer some creditors to others, and the fact that his sons were made the preferred creditors does not, of itself, furnish evidence of fraud; but the relationship is a fact to be considered with the other circumstances. Sons and sons-in-law figure at every turn of the evidence. The great effort on the part of the vendor seems...
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