Simon v. Levy

• Decision Date: 29 October 1895
• Citation: 36 Fla. 438,18 So. 777
• Parties: SIMON v. LEVY.
• Court: Florida Supreme Court

18 So. 777

36 Fla. 438

SIMON v. LEVY.

Florida Supreme Court

October 29, 1895

Appeal from circuit court, Escambia county; W. D. Barnes, Judge.

Action by M. Levy against Jacob Simon & Co. by attachment. H. J Simon interposed a claim, and from a judgment for plaintiff appeals. Reversed.

Syllabus by the Court

SYLLABUS

Where a debtor makes a fraudulent sale of a stock of goods to defeat his creditors, a creditor who, after acquiring knowledge of such fraud, acquiesces therein, and takes no steps to impeach it, but, on the contrary, goes into partnership with the fraudulent vendee for the purpose of carrying on trade with such goods, treating the sale of such stock to such vendee as being valid, thereby inducing such vendee to alter his position by purchasing new goods from time to time to replenish said stock and to carry on the business, such acquiescing creditor will be estopped from afterwards questioning or assailing such fraudulent sale, as against such vendee, though he was no party to the fraud in its incipiency. The law will not undertake to rectify one fraud by aiding a party in the perpetration of another fraud.

COUNSEL John C. Avery, for appellant.

Blount & Blount, for appellee.

OPINION

TAYLOR J.

M. Levy, the appellee, on the 29th day of March, 1889 instituted his suit by attachment in the circuit court of Escambia county against Jacob Simon and Louis Simon, as former copartners under the firm name of Simon &amp Co., the sole ground of the attachment, as laid in the affidavit therefor, being that the defendants were nonresidents of this state. The writ of attachment was levied by the sheriff upon a lot of clothing and gentlemen's furnishing goods in a store in Pensacola. The appellant, H J. Simon, interposed a claim to the goods levied upon, making the requisite oath of ownership and giving the required bond. Levy, the plaintiff in the attachment suit, succeeded in recovering judgment against Simon & Co., on the demand sued upon, prior to the trial of the claim case of H. J. Simon. The result of the trial of the claim case was also in Levy's favor, the verdict of the jury being adverse to the claimant; and from the judgment thereon the appellant claimant takes this appeal.

After the jury had retired to consider of their verdict, they returned into court, and through their foreman propounded to the court the following question: 'If we are satisfied that Mr. Levy had a knowledge of the sale to Steele & Co. and from Steele & Co. to H. J. Simon, if he was cognizant of these sales, and we determine that they were fraudulent, is he a participant in the fraud?' To which request for further instruction the judge responded with the following charge: 'He must participate in bringing them about,--in bringing about these sales and transfers,--and have a knowledge of them. But if he had no knowledge of these sales,--those sales that were made from Simon & Co. to Steele & Co., and from Steele & Co. to H. J. Simon,--and if he did not participate in bringing them about before they were made he would not be a party to the fraud.' This charge was excepted to, and is the first error assigned. The discussion of this assignment of error involves a consideration of the facts in proof. From the proofs it appeared: That the claimant, H. J. Simon, was a first cousin of Louis Simon, and a brother to Jacob Simon, who composed the firm of defendants in the attachment suit of Simon & Co. That said firm resided in Mobile, Ala., where they conducted their main business, but that they also conducted the branch store in Pensacola, Fla., that was in charge of M. Levy, the plaintiff in attachment, as their employé. That on or about the 1st of December, 1887, said firm failed in business, and made a general assignment for the benefit of their creditors of their Mobile property, and at or about the same time executed a bill of sale of their Pensacola store and stock to Louis Steele, of Baltimore, Md., the cousin of all three of the Simons. This bill of sale to Louis Steele, doing business as Louis Steele & Co., was dated November 30, 1887, and the consideration expressed therein is that it was to be in payment of $2,000 of the indebtedness of the vendors to said Louis Steele & Co. That an inventory of the goods in the Pensacola store, hurriedly taken at the time or shortly after this bill of sale, showed their value to be $2,700; the plaintiff testifying that this was an undervaluation, that their real value was between $3,300 and $3,400, and that an inventory of them, carefully taken by himself and the claimant in January, 1888, about a month after the bill of sale to Steele & Co., showed their value to be $3,342.20, which was their value at the time of the bill of sale to Steele & Co. That, prior to the failure of Simon & Co., H. J. Simon, the claimant, used frequently to come over to Pensacola from Mobile and direct the Pensacola branch of the business, as though he were one of its proprietors. Louis Steele testified that, prior to the execution of the bill of sale to him, he was not consulted in reference to same, and knew nothing of any intention to make it until he received the bill of sale itself; that he knew nothing of the Pensacola stock, its size or value. Besides this bill of sale, Steele received from the assignee of the Mobile property some pro rata payments upon the indebtedness due from Simon & Co. The plaintiff also testified that H. J. Simon was in Pensacola when he heard of the failure and assignment of the firm of Simon & Co.; that the night before informing them of the failure he asserted that he was going home to Mobile, but next morning he was still in Pensacola, and came briskly into the store, saying the boys (meaning Simon & Co.) had 'gone up,' and made an assignment, and that he would take charge of the business in Pensacola in the name of Steele & Co. The plaintiff, Levy, testified, further, that he had his suspicions of these transactions all along, but said nothing; that H. J. Simon at once asked how much money he had on hand, and he told him $13.50, upon which H. J. Simon told him to take that $13.50, as he did not want any cash carried away, and gave him the money, making no charge against him on the books for it; and that H. J. Simon told him to stay right there and make himself easy,--that he would be all right; that he intended to give him a showing there. The testimony further shows that in January (the day of the month not being given), A. D. 1888, Louis Steele & Co., for an expressed consideration of $3,000, made a bill of sale of the Pensacola stock to H. J. Simon, which consideration Steele swears...