Wright v. Zeigler Bros.

• Decision Date: 28 February 1883
• Citation: 70 Ga. 501
• Parties: Wright. vs. Zeigler Brothers.
• Court: Georgia Supreme Court

70 Ga. 501

Wright. vs. Zeigler Brothers.

Supreme Court of the State of Georgia

FEBRUARY TERM, 1883.

Fraud. Vendor and Purchaser. Evidence. Assignments. Amendment. Before Judge Eve. City Court of Richmond County. October Term, 1882.

On March 13, 1882, Zeigler Brothers brought trover in the city court of Richmond county against Wright, as assignee of Whittendale, to recover certain goods. Defendant filed the following pleas: (1), That the act creating the city court of Richmond county was unconstitutional, and that said court had no jurisdiction in the case; (2), the general issue; (3), that defendant holds possession ofthe property sued for under an assignment made by Whittendale for the benefit of his creditors, among whom plain tiffs are classed; and defendant prays that plaintiffs be required to elect whether they will claim as creditors, be fore proceeding with this action. By agreement, the goods were sold and the proceeds deposited in bank, subject to the determination of the suit.

When the case was called, defendant moved to dismiss it, because trover would not lie against the assignee. The court indicated his intention to dismiss the case. Thereupon, plaintiffs amended by striking the representative character of Wright, and leaving the suit to proceed against him personally. The case was then continued, plaintiffs filing exceptions pendente lite to the rulings of the court.

On the trial, the evidence on behalf of the plaintiffs showed, in brief, the following facts:

Christopher Whittendale, a merchant in Augusta, Georgia, having previously dealt with Zeigler Brothers, on the 7th of December, 1881, gave to one Challenger, their salesman, then in Augusta, Georgia, an order for the goods sued for, stated to be upon terms as usual, to be shipped by Savannah at once. The goods were shipped on December 31st, 1881, by the transportation any to whom they had been delivered December 29th, 1881. On the 27th of December, 1881, Whittendale countermanded the order, stating: " There is no business, and collections are slow." This letter was received December 31st, 1881. The goods came forward, and were received in the store of Whittendale January 5th, 1882, their receipt entered on the daybook; and on the 6th of January, 1882, Whittendale executed a general deed of assignment to Wright of all his stock and other property, their goods being in the schedule, and Zeigler Brothers named as creditors. Wright gave notice at once of the deed of assignment. Zeigler Brothers obtained from the newspapers their first knowledge of the failure, about January 7th, 1882. On the 10th of January, 1882, one of the plaintiffs visited Augusta, and saw the goods in possession of the assignee, after having failed in an effort to stop the goods in transitu. These goods were purchased on sixty days\' time. At the date of the order and the date upon which the goods were shipped, Zeigler Brothers believed Whittendale to be perfectly solvent, Whittendale was in good standing and credit with plaintiffs at the time they sold and shipped the goods.

The evidence for the plaintiffs, to show fraud, was as follows: A conveyance, November 29th, 1881, by Whittendale to Hardeman of Whittendale's residence, for five thousand dollars, which, on the same day, was conveyed by Hardeman back to Whittendale in trust for his wife and children. Sales by Whittendale to one J. B. White of goods to the amount of $3,000, about December 20th, 1881, at from five to eighteen per cent, discount from the face of the bills for cash, the bills being rendered without showing this discount. The books of Whittendale, showing that he ceased to make entries after December 6th, 1881, of cash received, which then showed a large balance to his credit, — the books being posted in other particulars, except the sales to White and to Damish, a preferred creditor, up to January 6th, 1882. That he had on hand August 2, 1881, a net capital invested in the business of twelve thousand eight hundred and forty-seven dollars, and that on the 6th of December, 1881, he had nineteen hundred and thirty-eight 65-100 dollars to his credit; that he drew but little from his business; was in the habit of discounting his own bills to December 1st, 1881; that he made large purchases during December, 1881, a large proportion of which goods were received after December 20th, 1881; that between $2,600 and $2,900 worth were received after January 1, 1882, and $1,447 worth were received on January 6, 1882, the day of the assignment; that none of the preferred creditors, under the deed of assignment, appear upon his books, with the exception of one McKnight's note; that on the 6th of January, 1882, he executed a deed of assignment, with preferences to the amount of seventeen thousand seven hundred and fifty dollars, with an excess of liabilities over assets of sixteen thousand one hundred and nineteen 46-100 dollars; that after the deed of assignment, on the 13th of June, 1882, Whittendale, as the trustee of his wife, conveyed his house and lot to Thomas C. Bligh.

In regard to the claim of McKnight, it appears that he and Whittendale had been partners, and dissolved August 5, 1881. Whittendale bought the notes and accounts for $2,500, giving therefor three notes due November 1, 1881, January 1, 1882, and April 1, 1882, (the last note being for $500, the others for $1,000 each). The first note was paid at maturity, the second was marked in the bill-book, "Paid January 4, 1882, " but no other entry appears.

Damish was another preferred creditor. It appeared that he was a clerk receiving $60 per month, and his account as such was balanced by cash and small items of merchandise. He also had a separate account on the ledger as of " Graham's P. O., S. C, " extending from September 3 to December 12, 1881. The largest purchase at any time was $186.14. Most of the purchases were for less than $100, and the aggregate amount was $858.67. He was credited with payments of cash, and on December 30 the account was balanced. On the blotter appeared entries of purchases on December 28 and 30, 1881, and January 3, 1882, which were marked " paid, " in pencil. He was placed among the preferred creditors as holding a note for $2,000.

The evidence for the defendant was as follows:

On the 29th of December, 1881, plaintiff's forwarded a bill for the goods sued for, which bill contained the following statement printed at the top thereof: "All payments must be made to the firm direct, unless upon special order; all claims must be made within three days after receipt of goods; no goods taken back unless damaged, or disagreeing with the terms of sale."

The goods sued for were received at Augusta, Ga., at the store of Christopher Whittendale, number 839 Broad street, January 5, 1882, and on their receipt entered on the day-book of Whittendale. On the 6th of January, 1882, Whittendale executed a deed of assignment to the defendant of all his effects, including the stock in trade in said store, an inventory of which is annexed to the deed of assignment, and upon which appears the goods sued for. The assignee accepted the trust January 6th, 1882, gave public notice the same day, and filed the deed of assignment for record January 7th, 1882, which was duly recorded. The goods were in the possession of the assignee at the time the suit was brought, and a demand made therefor. The names of plaintiffs appear as creditors on the schedule annexed to the deed of assignment for the amount of these goods, and also for the sum of nine hundred and nineteen 71-100 dollars, goods purchased October 14th, 1881, for which last debt a suit at law was instituted in this court March 13th, 1882, and judgment rendered July term, 1882. Defendant has no knowledge or information except what has been acquired by him as assignee since his appointment. Pursuant to the agreement indorsed on the declaration, defendant has certificate number 1898 for seven hundred and ninety-two 15100 dollars, issued by the Planters\' Loan and Savings Bank, with interest at five per cent. This sum is claimed by Frederick Damish, one of the preferred creditors under the deed of assignment, whose debt has not been paid from the assets passing thereunder. In due course of mail a letter from Augusta reaches Philadelphia in thirty-six hours, if mailed so as to take the first mail train and not delayed on the route.

The jury found for the plaintiffs, and judgment was entered accordingly. Defendant excepted, and assigned the following errors:

(1.) The court erred in the refusal to exclude the interrogatories of Zeigler, because the sixth cross-interrogatory isnot fully answered. [The interrogatory and answer are set out in the fifth division of the decision.]

(2). Because the court admitted testimony as to statements made by Whittendale after the assignment and after the plaintiffs had seen the goods in the possession of the assignee.

(3). Because the court admitted in evidence the deed made from Whittendale to Hardeman on November 29, 1881, and the deed from Hardeman to Whittendale, trustee, of the same date. —Defendant's counsel objected to these deeds as irrelevant, being acts between other parties and not connected with the plaintiffs or the sale of their goods.

(4). Because the court admitted a deed from...