Williams v. Fourth Nat. Bank
| Decision Date | 05 September 1905 |
| Citation | 82 P. 496,15 Okla. 477,1905 OK 62 |
| Parties | WILLIAMS v. FOURTH NAT. BANK OF WICHITA, KAN. |
| Court | Oklahoma Supreme Court |
Syllabus by the Court.
Section 1, c. 30, p. 249, Sess. Laws 1903, regulating the sale of stocks of merchandise in bulk, is not inconsistent with section 6 of the organic act, which provides that no law shall be passed impairing the right to private property; nor is it unconstitutional as being class legislation.
Where the evidence to support an attachment, sued out on the ground of a fraudulent conveyance or disposition of the debtor's property, shows a sale in bulk of the stock of goods levied upon, but the court finds that such sale was in fact made in good faith and without actual fraud, held, such finding overthrows the statutory presumption of fraud, and in such case the attachment cannot be justified, and should be dissolved.
A statutory presumption, which is not intended to be conclusive, may be overthrown by evidence of good faith.
Error from District Court, Comanche County; before Justice Frank E Gillette.
Action by the Fourth National Bank of Wichita, Kan., against J. T Williams, in which R. C. Williams interpleads. Judgment for plaintiff, and interpleader brings error. Reversed.
R. J Ray and J. A. Fain, for plaintiff in error.
Sims & Wolverton, for defendant in error.
The defendant in error sued J. T. Williams upon a judgment theretofore recovered against him in the Indian Territory. An attachment was sued out upon an affidavit alleging a conveyance by the debtor of his property with intent to cheat, hinder, and delay his creditors, and levied upon a stock of drugs. R. C. Williams appeared as interpleader, and claimed the property levied upon by virtue of a sale to him in bulk from the judgment debtor, his brother. This the bank in its answer denied, attacking the sale to the interpleader as fraudulent and void by reason of noncompliance with the requirements of the act of 1903 regulating the sale of merchandise in bulk. The interpleader's reply was a general denial. Judgment was for defendant in error, and the interpleader brings the case here for review.
The material propositions contended for are, first, the invalidity of the act regulating sales of merchandise in bulk; and, second, that a sale made without compliance without that act is not absolutely void, if made without actual fraud. Section 1, c. 30, p. 249, Sess. Laws 1903, provides "that a sale of any portion of a stock of merchandise otherwise than in the ordinary course of trade in the regular and usual prosecution of the seller's business, or a sale of an entire stock of merchandise in bulk, will be presumed to be fraudulent and void as against the creditors of the seller, unless the seller and purchaser together shall at least five days before the sale make a full detail inventory, showing the quantity and so far as possible with the exercise of reasonable diligence, the cost price to the seller of each article to be included in the sale, and unless such purchaser shall at least ten days before the sale, in good faith, make full and explicit inquiry of the seller as to the names, places of residence, or place of business, of each and all of the creditors of the seller and the amount owing each creditor, and obtain from the seller written answers to such inquiries, and unless such purchaser shall retain such inventory and written answers to his written inquiries for at least six months after such sale, and unless the purchaser shall at least ten days before the sale in good faith notify, or cause to be notified, personally or by registered mail, each of the seller's creditors, or whom the purchaser has knowledge, or can with the exercise of reasonable diligence acquire knowledge of said proposed sale, and the cost price of the merchandise to be sold and of the price proposed to be paid therefore by the purchaser." Section 2 (page 250) provides a penalty for making false and incomplete answers by the seller to the inquiries mentioned in the first section, and section 3 excepts executors, administrators, receivers, and public officers from the operation of the act.
In assailing the constitutionality of the act questioned plaintiff in error lays particular stress upon the contention that it contravenes that portion of the organic act of this territory which inhibits the passage of any law "impairing the right to private property." The act, it is true, does to some degree restrict owners of certain kinds of property from disposing of it in a particular way, without complying with certain conditions; but it is not for that reason necessarily inconsistent with the provision of the organic act quoted. The possession and enjoyment of all rights are subject to such reasonable conditions as may be deemed by the governing authority essential to the safety, health, peace, good order, and morals of the community, and, while the Legislature may not constitutionally declare that void which in its nature is, and under all circumstances must be, entirely harmless, yet it may place such reasonable restrictions on the right of an owner in relation to his property as becomes necessary to conserve the interests of the public, and to prevent frauds among individuals. The particular prohibition of the organic act referred to was not designed to interfere with the power of the Legislature to protect property and to promote morals and good order. The many acts regulating the mortgaging and sale of personal property, the sales of poisons, requiring certain articles of food made in imitation of other well-known articles to be branded with their names, and the like, are all statutes restrictive in character upon the right of owners to deal with their property, and such as a strict adherence in construction to the letter of the organic act would denominate unconstitutional. But these are among the undoubted subjects of legislation. The evident purpose of the Legislature was to provide...
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