11 S.D. 620 | S.D. | 1899
This is an action in equity brought by the plaintiff, a corporation, against the defendants, in which it prays the court to set aside a certain chattel mortgage on a stock of goods executed by one W. H. Curtis to one C. Shenkberg, and declare a bill of sale of the said Curtis to the C. Shenkb.erg Company, a corporation, and-a bill of sale made by the said C. Shenkberg Company to the defendant N. Smith, void, and that defendants be required to pay the value of the stock described in the said mortgage and bills of sale into court, to be applied upon a judgment obtained by the plaintiff against said W. Hi Curtis, and for such other and further relief as the court, in equity and good conscience, may deem just. The complaint in the action is very lengthy, and sets out the transactions in which Curtis, who was the original owner of the goods, and who is in the complaint alleged to be insolvent, mortgaged the said stock of goods to C. Shenkberg for the benefit of the C. Shenkberg Company, the Powers Dry-Goods Company, and Jewett Bros. & Jewett, aqd subsequently trans
The respondents insist that the judgment of the court is correct, for the reason that the plaintiff cannot maintain a creditors’ bill in this state against the parties in the possession of personal property which such plaintiff claims to belong to the judgment debtor. They insist that the only remedies that the plaintiff had was to have levied upon the property under the execution, and, if its right to take the same was contested, to have that right determined by an action at law, or to proceed under the provisions of the statute known as “proceedings supplementary to execution.” This view of the respondents, however, is in opposition to the decision? of the late territorial supreme court in Feldenheimer v. Tressel, 6 Dak. 265, 48 N. W. 94, in which case that court, after a careful review of the authorities, held that a creditor in this state could maintain an action to set aside fraudulent sales or incumbrances on the part of judgment debtors. That decision seems to have received the sanction of all the judges constituting the late supreme court, and must be regarded as settling the law in this state. See, also, Murtha v. Curley, 90 N. Y. 372; Southard v. Benner, 72 N. Y. 424.
' The appellant contends that the findings of the court in regard to the chattel mortgage and bills of sales from Curtis to the C. Shenkberg Company and from said company to N. Smith are not supported by tbe evidence. It is claimed by the
It appears that after the chattel mortgage was executed, and up to the time the possession of the stock of goods was turned over to Smith as the agent of the parties, there was only a small reduction of the amount due ■ under the mortgage, and the same seems to have been the case while the goods were in the possession of Smith; but this is accounted for by reason of the outlay for the large amount of goods, the purchase of which was necessary in order to maintain the stock in a salable condition. It also appears from the findings that Smith, at about the time he purchased the stock of goods from the C. Shenkberg Company, entered into an agreement with Curtis that, if Curtis should pay the amount Smith had paid for the goods, Smith would resell the stock to him; but'we fail to discover from any of these transactions any evidence of an actual intent to defraud the other creditors of Curtis.' The important question in this class of cases is, was the mortgage given to secure a bona fide indebtedness, and for the benefit of the creditors, or was the mortgage given as a mere sham to cover up the property and protect the' mortgagor from the claims of his creditors? It is -essential therefore, that there should be a valid, subsisting debt, which the mortgage is giv
Appellant strenuously insists that as a jury was impaneled to try the issues of fact, and found special findings to the effect that the mortgage from Curtis to C. Shenkberg, and the sale by Curtis to the C. Shenkberg Company and from it to N. Smith, were made with the intent to defraud the other creditors of Curtis, the court should have adopted'those findings, and made them a part of its findings in this case. But it is' well settled that the special findings of the jury in an equity case aré merely advisory to the court, and may be either adopted, or set aside, and other findings made by the court in opposition thereto. The special findings of the jury are not binding upon the court and are entitled to but little weight in this court, as against the findings actually made by the court itself. In this case the court was clearly justified in setting aside and disregarding the special findings of the jury, as they were not sustained by the evidence.