26 Cal. 316 | Cal. | 1864
Lead Opinion
Previous to the submission of this case upon its merits, counsel for respondents moved the Court to strike out the statement on motion for a new trial, upon the following grounds: First—Because no notice of plaintiffs’ intention to move for a new trial was given. Second—Because the statement does not specifically set forth the grounds of the motion. Third—Because the statement is not such a statement as the Practice Act contemplates, either on appeal or on motion for new trial.
Whether any notice of motion for mmjrial was given does not appear, and the statement ffj^j^wuwl^f^intradictory and inartificial, but there is appdfded^tp it'-^fSmulation made between the attorneys who teiel^hei^se inTfhl Court below which we think is a compleS aflfewerilip allpt% substantial objections made to the record* Tm sti]Ailatmijfe signed by the attorneys of both parties, ®bi foljjwing words : “ It is hereby stipulated by and K^weenJpj^attorneys for the plaintiffs and defendants, in the abov^mititled action that the foregoing statement hereto annexed is a true and correct statement on motion for a new trial. That upon said statement the said Court did, on the first day of September, 1863, overrule the plaintiffs’ motion for a new trial and refuse to grant the said plaintiffs a new trial in said action, to which ruling the said plaintiffs then and there excepted. And it is hereby further stipulated, that the judgment roll, orders and instructions, given and refused by the Court, the aforesaid statement on motion for a new trial, and this stipulation, is a true and correct statement on appeal to the Supreme Court, and may be used as such without further certificate or identification.”
The plaintiffs sue the defendant, Mulford, late Sheriff of Calaveras County, and his sureties, for the alleged wrongful seizure and sale of certain goods belónging to them, under certain executions against one Kraft. The answer alleges that the goods so seized were the property of Kraft, and as such legally subject to the seizure and sale.
It appears from the evidence set forth in the statement that for some time anterior to the 16th of December, 1857, Kraft had been engaged in selling goods and merchandise at Mokelumne Hill, in Calaveras County, where he also resided with his family, his dwelling house being in the fear of the storeroom, toward the centre of the lot. On that day he made a sale of his goods and merchandise to plaintiffs, and a lease of the storeroom. A bill of sale of the goods and a lease of the tenement were executed in writing by Kraft and wife and delivered to plaintiffs at the same time. The validity of that sale seems to have been impeached on three different grounds:
First—That it was made with the intent to hinder, delay or defraud creditors, and therefore void under the provisions of section twenty of- the statute concerning fraudulent conveyances.
Second—That it was not accompanied by an immediate delivery, and followed by an actual and continued change of possession, as required by section fifteen of the statute.
Third—That it was made in trust, for the use of the vendor, Kraft, contrary to the provisions of section eleven.
Upon the close of the testimony both parties presented certain instructions, which they respectively requested the Court to give to the jury, some of which were given and others refused, the parties respectively duly excepting.
It appears, from the evidence set forth in the statement, that the negotiations for the sale of the goods were closed on
It also appears from the testimony of Kraft, who was examined as a witness by the defendants, that there were certain conditions in the sale from him to plaintiffs not expressed in the bill of sale, to the effect that after twenty-four hours he was to go back to the store and sell the goods in the plaintiffs’ firm name, and the plaintiffs were to keep the stock up by furnishing fresh goods; that he was to draw seventy dollars per month for family expenses, and eight dollars per month to pay interest on money owed by him, and that the remainder was to be sent to the plaintiffs at San Francisco ; that the business was to be carried on for his benefit, and in the meantime the plaintiffs were to buy up all his debts at as low a figure as possible, and that after all the debts had been bought up, and the plaintiffs had received their advances, the stock was to be restored to him.
It is conceded by counsel for the plaintiffs that the question as to a fraudulent intent between vendor and vendee, as matter of fact, under the provisions of section twenty of the Statute of Frauds, was fairly submitted to the jury by the instructions of the Court upon that point; but it is insisted that the jury was not correctly instructed touching the law as found in the eleventh and fifteenth sections of the statute.
“ If the jury believe from the evidence that Kraft was hired by the plaintiffs—Grodchaux—and remained in possession of the goods he (Kraft) had sold to them as such hired man, the sale was void by the Statute of Frauds, aud the jury will find a verdict for the defendants.”
“ If the jury believe from the evidence that the plaintiffs agreed with Kraft to return the balance of the goods, or the money which they brought, after paying themselves for the money due them, it raises a secret trust in favor of Kraft and the contract was void, and they will find a verdict for the defendants.”
“ Though the sale be absolute in terms, yet, if the jury believe from the evidence that it was made with the understanding between Kraft and plaintiffs that it was only to operate as a mortgage, then it is a secret trust as to the surplus and is void as to the defendants, and the jury will find a verdict for the defendants.”"
The first of the foregoing instructions was designed to apply to the facts in evidence, and the law as found in the fifteenth section of the Statute of Frauds. (Wood’s Digest, 107.) That section reads as follows :
“ Every sale made by a vendor of goods and chattels, in his possession or under his control, and every assignment of goods and chattels, unless the same be accompanied by an immediate delivery and be followed by an actual and continued change of possession of things sold or assigned, shall be conclusive evidence of fraud as against the creditors of the vendor or the creditors of the person malting such assignment, or subsequent purchasers in good faith.”
Whenever a case arises under the provisions of the foregoing section, the question of fact to be determined is, whether the evidence shows an immediate delivery and an actual and continued change of possession, as contradistinguished from a mere formal, or pretended and temporary one; and is to be determined, like any other question of fact, by an inspection
“ In this controversy, as to what the true common law rule is, the Legislature wisely adopted, by statute, the construction given by the Supreme Court of the United States, for this course had at least the advantage of giving to the State one uniform rule in all Courts on this important subject. But we apprehend that the Legislature never intended, by this statute, to go beyond the extreme rule adopted by the Supreme Court of the United States, and the English cases on which that rule rests. There was no reason of policy for such extension; indeed, such extension might defeat, in some degree, the reason for adopting the Federal rule. The rule, as defined by our statute, is almost in the language of that given in the cases which establish the rule in England. It is true that some stress is laid on the words ‘actual and continued change of possession,’ but these words are suggested by the facts and principles of the decided cases referred to. The word ‘ actual’ was designed to exclude the idea of a mere formal change of possession, and the word ‘continued’ to exclude the idea of a mere temporary change. But it never was the design of the statute to give such extension of meaning to this phrase, ‘continued change of possession,’ as to require, upon a penalty of a forfeiture of the goods, that the vendor should never have*324 any control over or use of them. This construction, if made without exception, would lead to very unjust and very absurd results. A vendor could never become trustee of the goods without their being forfeited or liable for his debts. If a livery stable keeper hired a horse to the original vendor, it would be liable for his debts; or if a boarder came into a room the furniture might be liable for his debts, if he once owned it. The ‘ continued change of possession/ then, does not mean a continuance for all time of this possession, or a perpetual exclusion of all use or control of the property by the original vendor. A reasonable construction must be given to this language, in analogy to the doctrines of the Courts holding the general principles transcribed into the statute. The delivery must be made of the property; the vendee must take the actual possession ; that possession must be open and unequivocal, carrying with it the usual marks and indications of ownership by the vendee. It must be such as to give evidence to the world of the claims of the new owner. He must, in other words, be in the usual relation to the property which owners of goods occupy to their property. This possession must be continuous—not taken to be surrendered back again— not formal, but substantial. But it need not necessarily continue indefinitely, when it is bona fide and openly taken and is kept for such a length of time as to give general advertisement of the status of the property and the claim "to it by the vendee.”
Under the foregoing exposition of the statute (of the correctness of which we have no doubt,) the instruction of the Court in this case was undoubtedly erroneous, so far as it proceeds upon the theory that the employment of the vendor by the vendee in the subordinate capacity of a clerk or salesman is absolutely incompatible with an actual and continued change of possession, within the meaning of the statute; and that such employment is of itself, regardless of all the other facts and circumstances of the case, conclusive evidence of fraud. Such employment is undoubtedly a strong circumstance, tend-ting to show that there has not been such an actual change as
Speaking of a similar instruction, in Warner v. Carlton, 22 Ill. 424, the Supreme Court of Illinois said:
“It is based upon the hypothesis that the vendee had no right to employ the vendor as a clerk to sell the goods in connection with others. There is no doubt that it is a circumstance to be considered on the question of fraud, but undoubtedly may be explained. It is not per se a fraud that admits of no explanation. If the vendor, after the sale, without a delivery of the goods, were to remain in the sole and exclusive possession, it would amount to a fraud in law; but such is not the evidence in this case. No evidence showed that Carlton was in the sole and exclusive possession, but it tended to show that he was only acting as a clerk, and that Telfer was the person having charge of the concern and was the principal in its management. And, for aught that appears, the evidence may have been conclusive of that fact. This instruction, without modification, so as to leave it to the jury to determine from the evidence whether he had remained in the exclusive possession and control of the goods, without having ever delivered them to the purchaser, was erroneous and therefore properly refused.”
That the two remaining instructions above quoted are erroneous does not admit of argument. If they declare the law correctly no mortgages of personal property can be legally made in this State, which we apprehend is not the case, for where the instrument is upon its face a mortgage, containing the usual defeasance, there is an open trust as to any excess ; and where it contains no defeasance, but is in fact intended as
“All deeds of gift, all conveyances, and all transfers or assignments, verbal or written, of goods, chattels or things in action, made in trust for the use of the person making the same shall be void as against the creditors existing or subsequent of such person.”
It is not the intention of the statute to prohibit chattel mortgages, but to prevent a debtor from placing his property in the hands of a trustee having no beneficial interest therein to hold for his benefit "solely and enable him to receive and enjoy its income at pleasure, to the prejudice of his creditors. The language of the statute is, “ made in trust for the use of the person making the same.” These words are not descriptive of a mortgage contract. A trust as to the surplus necessarily arises in the case of a mortgage growing out of the nature of the contract, but such trust is not the object, nor one of the objects of the assignment. Its object is to give the creditor a lien as security for the payment of his debt, and it does not convey to him the legal title subject to a trust in favor of the mortgagor. The other creditors are not in any legal sense hindered or delayed or defrauded by the transaction. They may sue, notwithstanding, and reach the residuary interest of the mortgagor by attachment and execution, or by bill in equity, according to circumstances. (Leitch v. Hollister, 4 Coms. 216.)
We think all three of the instructions were erroneous, for the reasons which we have briefly given.
Judgment reversed and new trial ordered.
Concurrence Opinion
The instruction to the effect that if the sale was understood between the parties to be only a mortgage, then there was a secret trust within the meaning of the Statute of Frauds, and
