Josephi v. Mady Clothing Co.

| Mont. | May 22, 1893

Lead Opinion

De Witt, J.

Upon the trial of the case the defendant objected to the evidence in reference to the alleged fraudulent disposition of the property, upon the ground that the affidavit setting it forth was defective. The affidavit set forth the fraudulent intent in the language of the statute. The defendant’s objection was that the affidavit states no facts within the statutory requirements. Thereupon the plaintiffs asked leave to amend their affidavit, which leave was granted by the court, and they then and there incorporated into the affidavit five paragraphs of the complaint, including paragraphs 3,4, and 5, mentioned in the statement above, which paragraphs were a full setting forth of the acts which plaintiffs claimed showed the fraudulent intent of the defendant to dispose of its property. It is not contended by appellant that the affidavit as amended was insufficient, but it is now urged in this court" that the original affidavit was jurisdictional, and that it was so defective that it was no affidavit, and the court never had jurisdiction of the case. Respondents contend that, even if the original affidavit were not sufficient, it was not error to allow the amendment. This case is not like those cases wherein there was no affidavit at all. There was an affidavit here, which set out the facts in the language of the statute. The complaint is that they were not sufficiently stated. Passing the question of whether the affidavit was originally sufficient, we feel satisfied that the tendency of the decisions of this court is that such an affidavit may be amended. (Pierse v. Miles, 5 Mont. 549" court="Mont." date_filed="1885-01-15" href="https://app.midpage.ai/document/pierse-v-miles-6637563?utm_source=webapp" opinion_id="6637563">5 Mont. 549; Langstaff v. Miles, 5 Mont. 554" court="Mont." date_filed="1885-01-15" href="https://app.midpage.ai/document/langstaff-v-miles-6637565?utm_source=webapp" opinion_id="6637565">5 Mont. 554; Magee v. Fogerty, 6 Mont. 237" court="Mont." date_filed="1886-08-15" href="https://app.midpage.ai/document/magee-v-fogerty-6637657?utm_source=webapp" opinion_id="6637657">6 Mont. 237.) In .the last case, Chief Justice "Wade, in the opinion, said: “ The procuring of an attachment, and the steps necessary therefor, is a proceeding within the spirit and meaning of the one hundred and fourteenth section [section 116] of the Code of Civil Procedure; and if such proceeding is defective, the same may be amended, in the furtherance of justice, like any other proceeding under that section.”

As to the estoppel suggested by appellant by reason of the. judgment in the case of Kleinschmidt & Brother v. Mady Clothing Company, I concur in the result reached in the other opinion filed in this case.

Another error claimed is as follows: A witness, Gaines, was upon the stand. He says that in 1890 he was the agent of the commercial reporting association of R. G. Dun & Co. He was asked this question: “Tell us what your conversation was with Mr. Kleinschmidt, in May, 1890, in reference to the Mady Clothing Company?” The defendant objected, on the ground that Kleinschmidt was not a party to the action, and the declarations made by him are not material to bind any one connected with the parties, or the parties themselves. The objection was overruled, and the witness testified that Kleinschmidt had told him, about May 3,1890, that the capital stock of defendant was $15,000; that he held $10,000, and Mady $5,000; and that the company had started with a clean balance sheet. The company was incorporated May 1, 1890. It appears that Kleinschmidt was a trustee of defendant, and a stockholder to the extent of two-thirds of the stock. A contention of the action was that defendant was disposing of its goods with the intent to defraud its creditors, and disposing of them to this same Albert Kleinschmidt and another. It was being contended that about the commencement of the action there was a large alleged indebtedness from the defendant to said Albert Kleinschmidt and another. The plaintiffs were claiming that this large indebtedness was a fraudulent one, and the defendant was disposing of its goods, or allowing its goods to be taken by said Kleinschmidts, on account of said alleged fraudulent indebtedness. Now, under this condition of affairs, a large fraudulent indebtedness being claimed to exist in October, we are of opinion that it was not error to allow the witness to testify that Albert Kleinschmidt had told him on May 3d that the Mady Clothing Company had started with a clean balance sheet on May 1st, when the plaintiffs were claiming and undertaking to prove that the company had a decidedly unclean balance sheet the October following.

There is one more matter presented by appellant. The verdict of the jury was as follows: “ We, the jury in the above-entitled case, do hereby find in favor of plaintiffs.” The appellant objects that this verdict does not comply with the statute (Code Civ. Proe., § 276), in that it does not state the amount awarded plaintiffs. But our statute provides, in section 271, of the Code of Civil Procedure, that “ if the verdict be informal or insufficient in not covering the whole issue or issues submitted, or in any particular, the verdict may be corrected by the jury, under the advice of the court, or the jury may be again sent out.” Under this provision the verdict could have been made more formal if it were necessary; but appellant, at the time of its rendition, made no application to that effect, nor did he make any objection to the verdict on motion for new trial. (Douglass v. Kraft, 9 Cal. 562" court="Cal." date_filed="1858-07-01" href="https://app.midpage.ai/document/douglass-v-kraft-5433669?utm_source=webapp" opinion_id="5433669">9 Cal. 562.) But we are of opinion that, as a matter of fact, the verdict is not objectionable. There was no issue in the pleadings as to the amount due plaintiffs. The complaint sets up the claim for $1,283.50, and the answer does not deny the indebtedness, nor the amount thereof. The only denial was to the effect that the amount was not yet due; that is, that the allegations of fraud by which it was sought to show that the debt should be considered as due were not true. Therefore, as far as the amount was concerned, it was admitted by the pleadings. (Hutchinson v. Superior Court, 61 Cal. 119" court="Cal." date_filed="1882-07-27" href="https://app.midpage.ai/document/hutchinson-v-superior-court-5440840?utm_source=webapp" opinion_id="5440840">61 Cal. 119.) Therefore, when the jury found their verdict simply to the effect that it was for plaintiffs, they found, in effect, for the plaintiffs on the issue in controversy; that is, the issue of fraud, which made the debt then due. We are of opinion that this is just such a form of general verdict as was suitable to the issues. Judgment was thereupon entered for the amount admitted to be due, namely, $1,283.50.

The points above discussed are those presented in the briefs and arguments. None of them, we are of opinion, should be sustained. The judgment is therefore affirmed.

Affirmed.

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Concurrence Opinion

Pemberton, C. J., and Harwood J.

(concurring). The principal assignment of error is pointed to the ruling of the trial court in permitting respondents to amend their affidavit for attachment. We conclude from a review of all the authorities cited by both appellant and respondents, and such others as we have been able to examine, that the ruling of the trial court permitting plaintiffs to amend the affidavit for attachment should be sustained. (Tilton v. Cofield, 93 U.S. 163" court="SCOTUS" date_filed="1876-11-20" href="https://app.midpage.ai/document/tilton-v-cofield-89358?utm_source=webapp" opinion_id="89358">93 U. S. 163, and cases cited; Erstein v. Rothschild, 22 Fed. Rep. 61.) These cases contain a very able and conservative treatment of this question. (See also, Coston v. Paige, 9 Ohio St. 397; Wheeler v. Farmer, 38 Cal. 203" court="Cal." date_filed="1869-07-01" href="https://app.midpage.ai/document/wheeler-v-farmer-5436970?utm_source=webapp" opinion_id="5436970">38 Cal. 203.) In our opinion, the statute of this state authorizing amendment of pleadings or proceedings in civil actions (Code Civ. Proc., §§ 112-19) contemplates such affidavit as one of the proceedings in working out the remedial rights of a party, and that an amendment of the nature offered in this case should be permitted, especially where the court has acquired jurisdiction of defendant by personal service, and he is present, defending, as in the case at bar. The amendment in this instance was in relation to pleadable and controvertible facts (Code Civ. Proc., § 183) on which was predicated the right to an attachment process prior to the maturity of the debt sued on. Of course, in permitting an amendment of the affidavit by incorporating therein averment of facts for the first time, by which the other party might be taken by surprise, the court should grant such party proper time to controvert, and prepare to defend against such allegations. But in the case at bar defendant could not have been surprised or prejudiced by the amendment of the affidavit, inasmuch as the facts inserted therein by amendment had already been alleged in the complaint.

The assignment of error on the admission of the testimony of Gaines, to the effect that on or about May preceding the transaction in question, which was alleged to have taken place in October, Kleinschmidt stated to witness that defendant the Mady Clothing Company had commenced business “with a clean balance sheet,” cannot be sustained. Kleinschmidt is alleged in the complaint to have been a party to the alleged fraudulent scheme set forth, whereby the company was disposing of its effects for the purpose of hindering, delaying, and defrauding its creditors; and prior to the admission of said testimony, it was shown that, when the alleged conversation occurred, Kleinschmidt was an officer and stockholder in defendant the Mady Clothing Company. The objection was that the statement made in that regard, and under the circumstances shown by Kleinschmidt, could not bind the defendant corporation. This is no doubt true; nor was the said testimony introduced for any such purpose. The testimony in question was evidently introduced to show the conditions as to indebtedness existing between said company and Kleinschmidt, in May, according to the statement of Kleinschmidt, who afterwards asserted a large indebtedness against said company, which plaintiffs had alleged was a fraudulent and fictitious claim, asserted through collusion of said company with Kleinschmidt; which claim was made the basis of seizure of the company’s goods. We think said testimony objected to was admissible.

The point raised by appellant to the effect that plaintiffs were barred by a former adjudication from showing the fraud set up in this action to justify the issuance of attachment process prior to the maturity of the debt sued on is untenable, because no such bar (if the facts supporting it existed) was pleaded by defendant. The answer “ put in issue the matter alleged in the affidavit” (Code Civ. Proc., § 183) to support such attachment, but in no manner pleaded any other adjudication or judgment in bar. (Code Civ. Proc., § 103; Bliss on Code Pleading, § 303; 1 Estee on Code Pleading and Practice, § 328; 2 Estee on Code Pleading and Practice, §§ 3267-70, and cases cited; Boone on Code Pleading, § 161.)