Wilson v. Sax

Citation21 Mont. 374
PartiesWILSON et al. v. SAX et al.
Decision Date06 June 1898
CourtUnited States State Supreme Court of Montana

21 Mont. 374

WILSON et al.
v.
SAX et al.

Supreme Court of Montana.

June 6, 1898.


On rehearing. Reversed.

For former opinion, see 47 Pac. 1101.

Hunt, J., dissenting.


Creditors' bill to avoid an assignment for the benefit of creditors made by Bathsheba Harris to Moses Morris. Bathsheba Harris on December 14, 1891, made a general assignment for the benefit of her creditors, with preferences declared in favor of certain creditors, among whom were her daughter Annie Harris and her daughter-in-law Sarah S. Harris, wife of Ben E. Harris. From September, 1884, to October, 1891, the assignor conducted a clothing business, through the agency and management of her son Ben E. Harris, at No. 19 North Main street, in Helena, Mont., and from October, 1891, until the time of the assignment the business was conducted in the same way at No. 119 North Main street, in the city named; a portion of the stock inquestion formerly carried at the old place of business having been removed to the new place of business, and the remainder having been left at the old stand. The defendants and appellants claim that the goods left at No. 19 had been sold by the assignor to the defendants Sax & Zekind, a partnership composed of Salina Sax, daughter of the assignor, and Carrle L. Zekind, while plaintiffs assert that the alleged sale was merely a device to conceal the continued ownership of the assignor, and made in contemplation of a subsequent assignment. Immediately after the assignment, all of the goods at No. 119 North Main street were delivered by Ben E. Harris to defendant Moses Morris, as assignee, who subsequently sold a large portion of the goods, and collected some of the accounts, but ultimately disposed of the entire remnant of the stock of goods, and all the uncollected accounts, in bulk, to H. L. Frank, a wholesale liquor dealer, then residing in Butte. The good faith of the assignee is conceded, but plaintiffs claim that the real purchaser at the sale to Frank was the assignor, Bathsheba Harris. Within a few weeks after the assignment, each of the plaintiffs commenced an action in the district court of Lewis and Clarke county against the assignor, and caused a writ of attachment to be issued, directed to the sheriff of that county; and thereafter the sheriff attached under each of the writs all moneys, goods, effects, and debts due or owing, and other personal property belonging, to the assignor, in the possession and under the control of defendants Sax & Zekind and the defendant Moses Morris, by delivering to each of the defendants personally a copy of each of the writs of attachment, with a notice in writing appended thereto that such credits, debts, and property were thereby attached in pursuance of said writ. Subsequently each of the plaintiffs recovered a judgment against the assignor in each of said actions, and caused a writ of execution to be issued upon each of the judgments, which writs were returned by the sheriff wholly unsatisfied. After the return of the execution issued upon one of the judgments, plaintiffs therein applied to the district court where the judgments were entered, by proceedings pursuant to the provisions of the Compiled Statutes then in force; and after the usual examination, it appearing therefrom that defendants Sax & Zekind and defendant Morris each claimed an interest in the property in their possession sought to be reached through said proceedings, an order was made and entered by the court authorizing plaintiffs to institute a suit against Morris and Sax & Zekind to recover such interest in the property so claimed by them; the said defendants being by said order restrained from disposing of any of the property until that action had been prosecuted to judgment, or until otherwise ordered. This suit was then commenced. The complaint, after reciting the commencement of each of said actions, the levying of the writs of attachment in the manner hereinbefore stated, the issuance and return wholly unsatisfied of each of the executions, and the supplementary proceedings in one of the actions, further alleges that the assignment was fraudulent and fictitious, and was made for the purpose and with the intent of hindering, delaying, and defrauding the plaintiffs and other creditors of the assignor; that the assets in the possession of the assignee were insufficient to pay the preferred claims; that the assignor at the time of the making of the assignment was the owner of a stock of goods in Helena worth many thousands of dollars, which she did not turn over to the assignee, but which she fraudulently claimed to have sold to defendants Sax & Zekind before the assignment was made, and that such transfer was made without any consideration, for the purpose and with the intent of hindering, delaying, and defrauding plaintiffs and others of her creditors; that the assignor retained in her possession and under her control other property which was not by law exempt from execution, for the purpose of gaining a benefit for herself, and with the intent tohinder, delay, and defraud the plaintiffs and other creditors of hers; that the alleged indebtedness of the assignor to her daughter Annie Harris and her daughter-in-law Sarah S. Harris, preferred under the assignment, was pretended and fictitious, and was inserted in the assignment for the purpose of consuming the proceeds of said property; that the assignor retained in her possession a large sum of money for the purpose and with the intent of hindering, delaying, and defrauding her creditors; and that the assignor purchased from the plaintiffs and other persons large quantities of goods, worth many thousands of dollars, without any intention of paying for them. Plaintiffs prayed that the assignment be declared fraudulent and void as to them; that the defendants Sax & Zekind and Moses Morris be required to account for all the property that had been received by them from the assignor, and that all of the defendants be restrained by injunction from interfering with said property; and that the plaintiffs' judgment be satisfied out of said property. The answers deny all the material allegations of the complaint, except those reciting the institution of the several suits, the levying of the writs of attachment by the garnishments, the issuance and return of the executions, and the supplementary proceedings. In the separate answer of defendants Sax & Zekind it is alleged that Salina Sax advanced and loaned to the assignor, her mother, at different times, in various amounts, the total sum of $11,800, for which the assignor agreed to pay and did pay $150 per month; that a few months prior to the assignment the assignor sold to Mrs. Sax the stock of merchandise at No. 19 North Main street, and credited the amount of her advances upon the purchase price of the stock; that the assignor's indebtedness to Salina Sax was thus fully settled by the sale, made in good faith; and that Salina Sax thereafter failed to assert any further claim against the assignor, or any right to participate in the assigned estate.

The case was twice tried in the district court. The first trial resulted in a disagreement and discharge of the jury. When counsel for plaintiffs opened the case upon the second trial, they stated that, as there were sufficient funds in the hands of the assignee to pay the plaintiffs' judgments, they would not ask any decree as against defendants Sax & Zekind, or as to the property in their possession which had been garnished, though they did not abandon any of the issues raised by the pleadings as to the fraudulent or fictitious character of the alleged sale by the assignor to those defendants. The defendants objected to the introduction of any evidence, on the ground that the complaint did not state facts sufficient to constitute a cause of action; and, upon this objection being overruled by the court, they excepted. During the trial the defendants reserved exceptions to the rulings of the court in admitting certain of plaintiffs' proofs, in overruling defendants' motion to strike certain of plaintiffs' evidence, in denying defendants' requests for instructions to the jury, and in giving the instructions which were given. The jury made special findings, all of which were adopted by the court, except one, which was set aside, and a new finding made by the court in lieu thereof. The court also made other special findings, which need not be noted here, as they will be set out in the opinion. As conclusions of law, the court found: (1) “That the assignment alleged to have been made by the defendant B. Harris to the defendant Moses Morris is void; the same having been made for the purpose of hindering, delaying, and defrauding creditors.” (2) “That each of the plaintiffs is entitled to a lien upon the funds in the hands of the defendant Moses Morris, by virtue of the execution by garnishment of the several attachments as hereinbefore set forth; that they are each severally entitled to a lien by virtue of the service of garnishment notices upon the defendant Moses Morris upon the executions issued as hereinabove set forth; that each of said plaintiffs are entitled to liens upon said funds in the hands of said defendant Moses Morris by virtue of the filing of the complaint of the plaintiffs, and of the complaints of intervention; that said last liens became operative from the date of the filing of said complaints.” Judgment was accordingly entered for the plaintiffs, and the defendants have appealed from the judgment, and also from an order refusing a new trial. The judgment and order appealed from were affirmed by an equally divided court in Wilson v. Harris, 19 Mont. 69, 47 Pac. 1101, a rehearing was granted, and the case has been reargued and submitted for decision by a full bench.

PIGOTT, J. (after stating the facts as above).

Defendants specify 93 errors of law, and 34 particulars in which the evidence is claimed to be insufficient to justify the findings. Many of the...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT