Veum v. Stefferud

• Decision Date: 16 November 1923
• Citation: 50 N.D. 371,196 N.W. 104
• Parties: VEUM v. STEFFERUD, Sheriff.
• Court: North Dakota Supreme Court

50 N.D. 371

196 N.W. 104

VEUM

v.STEFFERUD, Sheriff.

Supreme Court of North Dakota.

Nov. 16, 1923.

Syllabus by the Court.

In a conversion action against the sheriff, brought by the purchaser from a judgment debtor of grain under a bill of sale executed before the judgment creditor seized the grain under an attachment, where the defense is that the sale was colorable and fraudulent, it is held that the question of whether there was a change of possession, within section 7221, Comp. Laws 1913, is one of fact for the jury.

A question of fraudulent intent is one of fact for the jury, under section 7223, Comp. Laws 1913.

The sufficiency of the evidence to support the verdict cannot be challenged on appeal in the absence of a motion for a directed verdict or for a new trial.

When error is asserted upon the admission in evidence and the alleged misuse in the argument to the jury of exhibits admitted under the discretionary power of the trial court, it is the duty of the person asserting such error to prepare and preserve a record from which such error affirmatively appears.

Additional Syllabus by Editorial Staff.

The “change of possession” contemplated in Comp. Laws 1913, § 7221, relating to presumptions of fraud arising from conveyances of personal property not accompanied by change of possession, must be open and unequivocal, have the usual characteristics and indications of ownership, be such as to indicate to the world the claims of the new owner, the possession be continuous, though not necessarily continuing indefinitely, substantial, and not merely formal, and there should not be present an intention to return the property.

Appeal from District Court, Ward County; Geo. H. Moellring, Judge.

Action by A. B. Veum against O. H. Stefferud, Sheriff. Judgment for plaintiff, and defendant appeals. Affirmed.McGee & Goss, of Minot, and B. E. Crippen, of Parshall, for appellant.

Palda & Aaker, of Minot, for respondent.

JOHNSON, J.

This is an action to recover the value of a quantity of grain alleged to have been converted by the defendant. The defendant, as sheriff of McLean county, seized the grain under a warrant of attachment issued in an action in which the State Bank of York was plaintiff and one Albert W. Johnson was defendant. The case was submitted to a jury in Ward county, and resulted in a verdict for the plaintiff in the sum of $1,004.42, with interest at 6 per cent. from September 27, 1920, to the date of the verdict.

Albert W. Johnson, the defendant in the attachment action, rented some land in McLeancounty from the owner, a Mr. Myers, upon the crop share plan. Under contract of tenancy Johnson put in the crop in the spring of 1920. The crop was in due season harvested and threshed, and the wheat alleged to have been converted was put into a bin on the premises. Between 500 and 600 bushels of wheat were seized by the defendant under a warrant of attachment on the 27th of September, 1920, a few days after the grain was threshed. Shortly thereafter the plaintiff, Veum, made a third party claim to the crop in the manner provided by statute. The sheriff refused to recognize the validity of plaintiff's claim of ownership, and the crop was sold and the proceeds were presumably delivered to the plaintiff in the attachment suit. Plaintiff thereupon brought this action to recover for the conversion of the grain, claiming the ownership thereof at the time of the levy.

The plaintiff's claim of ownership is based upon transactions which culminated in the execution and delivery to him of a bill of sale, dated June 19, 1920, of A. W. Johnson's share in the crop that was then growing upon the premises rented by Johnson. There is evidence in the record which tends to show that Veum had advanced sums of money to Johnson from time to time; that on the 19th of June, when the bill of sale was made, Johnson was indebted to Veum to the amount of about $1,800. Veum then says that, after the bill of sale was executed, he took possession of the crop and harvested the same; that he hired Johnson and other men to harvest the crop, and paid for all the work himself, Johnson's labor included. Plaintiff further testified that he paid for the threshing of the crop. The testimony of Johnson is substantially to the same effect. The bill of sale was executed and delivered for the purpose of paying or of securing the indebtedness of Johnson to the plaintiff. The plaintiff does say, on cross-examination, that the bill of sale was taken for security. The case was tried and submitted to the jury on the theory that the bill of sale evidenced a sale rather than a mortgage transaction. Appellant never suggested to the trial court that the instrument should be considered as a mortgage or gave the trial court an opportunity in any form to pass upon that question. Appellant asked for certain instructions, all of which were framed on the theory that the bill of sale was what it purported to be upon its face, evidence of an attempted transfer of title to certain property. He did not make a motion for a nonsuit, for a directed verdict, for judgment non obstante, or for a new trial. Counsel cannot now rely on a lien theory when the case was tried on the theory of a fraudulent sale. 3 C. J. 718.

The defendant challenges the claim of the plaintiff to the ownership of the crop or to any y interest therein upon the ground that the transaction between the plaintiff and Johnson was merely colorable and entirely fraudulent, and that the bill of sale was executed solely for the purpose of hindering, delaying, or defrauding the creditors of Johnson; it is claimed that both plaintiff and Johnson were parties to this scheme. The bill of sale was not filed. There is evidence to the effect that Johnson did not live on the land he rented, and on which the grain seized was grown, at any time during 1920; that plaintiff himself assisted in threshing and caring for the grain; that the plaintiff received the proceeds of at least some of the wheat and the flax which was raised on the land; that Johnson told the deputy sheriff, at the time of the levy, that he was not the owner of the crop; and that 568 bushels of wheat were seized by the sheriff. The market value of the wheat was shown. The record shows that the debt on which the cause of action in the attachment suit was founded was contracted before the bill of sale was delivered on June 19, 1920.

The statutes relating to fraudulent transfers, so far as material to the present inquiry, are as follows:

Section 7220. “Every transfer of property or charge thereon made, every obligation incurred and every judicial proceeding taken with intent to delay or defraud any creditor or other person of his demands is void against all creditors of the debtor and their successors in interest and against any persons upon whom the estate of the debtor devolves in trust for the benefit of others than the debtor.”

Section 7221. “Every sale made by a vendor of personal property in his possession or under his control and every assignment of personal property, unless the same is accompanied by an immediate delivery and followed by an actual and continued change of possession of the property sold or assigned, shall be presumed to be fraudulent and void as against the creditors of the vendor or assignor, or subsequent purchasers or incumbrancers in good faith and for value, unless those claiming under such sale or assignment make it appear that the same was made in good faith and without any intent to hinder, delay or defraud such creditors, purchasers or incumbrancers.”

Section 7223. “In all cases arising under section 5599 or under the provisions of this chapter the question of fraudulent intent is one of fact and not of law; nor can any transfer or charge be adjudged fraudulent solely on the ground that it was not made for a valuable consideration.”

[5] The change of possession contemplated in section 7221, supra, and necessary to avoid the presumption of fraud, must generally and ordinarily be open and unequivocal, and must have the usual characteristics and indications of ownership. It should be such as to indicate to the world the claims of the new owner. The possession should be continuous, though it need not continue indefinitely;that is, there should not be present an intention to return the property. It must be substantial, and not merely formal. Petrie v. Wyman, 35 N. D. 126, 159 N. W. 616; 20 Cyc. 545; Stevens v. Irwin, 15 Cal. 503, 76 Am. Dec. 500;O'Gara v. Lowry, 5 Mont. 427, 5 Pac. 583;Walters v. Ratliff, 10 Okl. 262, 61 Pac. 1070; Topping v. Lynch, 25 N. Y. Super. Ct. 484; Guthrie v. Carney, 19 Cal. App. 144, 124 Pac. 1045;O'Brien v. Ballou, 116 Cal. 318, 48 Pac. 130;Rosenberg v. Ross, 6 Cal. App. 755, 93 Pac. 284. See, also, McDonald v. Fitzgerald, 42 N. D. 133, 171 N. W. 879.

[3] Specifications 2, 4, and 5 refer to the reception in evidence of the bill of sale and the third party claim. There is no merit to these assignments, and indeed they are not seriously urged by the appellant. In specification 3, appellant alleges error based upon a denial of his motion for a directed verdict at the close of the case. We find no such motion in the record. The transcript of the proceedings shows that both sides rested when the testimony had been taken without a motion to dismiss the case or direct a verdict. Neither did the defendant and appellant make a motion for a new trial. The sufficiency of the evidence to support the verdict cannot be challenged in this court in the absence of a motion for a directed verdict or for a new trial. That has been the rule in this jurisdiction since the decision in Morris v. Minneapolis, St. P. & S. S. M. R. Co., 32 N. D. 366, 155 N. W. 861, construing section 7843, C. L. 1913. Baily v. Davis (N. D.) 193 N. W. 658;Rokusek v. Nat. Fire Ins. Co. (N. D.) 195 N. W. 300. There remain for consideration, therefore, only...