38 Mo. App. 425 | Mo. Ct. App. | 1889
delivered the opinion of the court.
This was an action of replevin for twenty-live rolls of carpet of the value of fifteen hundred and twenty-three dollars and forty-two cents. The action was originally brought against two defendants, the J. M. Ward Furniture-, Stove and Carpet Company, a corporation, and John IT. Yette. An amended petition was filed, joining as defendants, the New York Storage Warehouse and Furniture Yan Company, also a corporation. An order of delivery was obtained, under which the plaintiffs procured possession of the property from the actual custody of the warehouse company, which had issued a warehouse receipt for the same, which receipt was held by Yette. The J. M. Ward Furniture, Stove and Carpet Company' (which will hereafter be spoken
The case went to trial before a jury, and at the close of plaintiffs’ evidence the court instructed the jury that, upon the evidence and pleadings, the plaintiffs could not recover; that they should find for the defendants, the warehouse company and Vette, for the return of the property and nominal damages for its detention, and also state the present value of it, which could not be more than fifteen hundred and twenty-three dollars and forty-two ' cents. The jury returned a verdict accordingly. Judgment was entered thereon, and the plaintiffs prosecute this appeal.
The grounds, on which the plaintiffs prosecuted this action of replevin were that the J. M. Ward Furniture, Stove and Carpet Company had purchased these goods from the plaintiffs, intending never to pay for them; and that the defendant Yette, to whom the furniture company had pledged them for an advance of money, had taken them under circumstances which either affected him with knowledge, or put him upon. inquiry, with respect to the fact that the furniture company had so purchased the. goods, intending never to pay for them.
We think that there was evidence sufficient to take the question to the jury, whether the furniture company, at the time of the purchase of the goods, intended never to pay for them. ' The evidence tended to phow that the furniture company had, for a considerable time, done business in St. Louis on what is known as the “installment plan,” which consists of selling furniture, carpets, etc., at retail to householders, hotel keepers and the like, chiefly on credit, a small cash payment being made at the time of the sale of the goods, and the rest paid in monthly installments; that, while the Fifth National Bank of. St. Louis was in existence, that bank had been in the habit of lending money to the furniture company upon the notes of the company, secured by the notes which it thus received from its customers for monthly installments, as collateral; that, after the failure of the Fifth National Bank, the furniture company had been in the habit of negotiating the notes received from its customers with Yette, who was a moneylender, and who discounted the notes upon their being endorsed by the furniture company, much as a bank would, except that he reserved a rate of interest varying from two per cent, to three per cent, per month, the latter being his rate of discount at the time of the transaction in controversy. It appeared that the notes, which Yette thus discounted, were placed in the hands of the furniture company for collection at their maturity. The money thus collected by the furniture company, on notes which Yette had
Such being the state of the company’s affairs, and such being the state of Yette’s knowledge with respect to the same, when the goods in controversy arrived in St. Louis, instead of being taken into the store house of the furniture company and placed with its other goods, they were sent back to the warehouse of the St. Louis Transfer Company, the common carrier by whom they
Upon this state of evidence, we are of opinion that there was a question for the jury, whether, at the time when the furniture company ordered of the plaintiffs the goods in controversy on the twenty-fifth of October, they ordered them, intending never to pay for them. One of the rules by which this is to be tested was laid down by this court in Elsass v. Harrington, 28 Mo. App. 300, 305, as follows: “The purchaser must intend never to pay for them; and while many insolvent merchants take more hopeful views of their future than events justify, yet, where a merchant purchases shortly before failure, and at a time' when his business is hopelessly swamped, it must, we think, be left to a jury in an action of this kind, to say whether he intended ever to pay for the goods. A knowledge on
But we think that there was such evidence in this case. The fact that the regular course of business of the furniture company was to sell on monthly credits; that for nearly a year all of its paper received from its customers on these sales, and secured by chattel mortgages, had been discounted — not by a banker at ordinary rates — but by Yette, an outside usurer, whose rate of discount had risen from two to three per cent, a month; that, about the middle of October, 1888, the furniture company had sustained a loss of two thousand dollars, which would equal half its capital; that about the same time it had taken out of bank a series of notes aggregating fifteen thousand dollars, payable in fiítéen successive monthly installments of one thousand dollars each, secured by a chattel mortgage, which were there pledged as collateral for a loan of eight thousand dollars, and had sold the same to Yette for thirteen thousand dollars, thus suffering the ruinous discount
It is also to be remembered that this question is presented in a different aspect in the case of a corporation from that in the case of an individual. In a business corporation in Missouri, its capital stock and surplus, if it have any surplus, are the only resources out of which its debts can be collected; its individual shareholders are not liable to the corporation, or to its creditors, beyond making good what they have subscribed to its capital stock. The capital stock of this corporation, whether all paid in or not, was, at the time of this transaction, more that eaten up by its debts; nearly all the money on which it did business had for a long time been furnished by the Fifth National Bank and Yette. When a corporation suspends business by reason' of insolvency, it is practically dissolved and dead, and for some purposes legally so. Slee v. Bloom, 19 Johns. 456. A corporation can, of course, have no intent, except thé intent of its managers. In view of the foregoing considerations, a jury would be warranted in finding from the evidence that, when this purchase of goods was made, the managers of the furniture company knew that the company would never be able to pay for them; and this, in theory of law, is tantamount to an intent on the part of the corporation never to pay for them.
But the present case concerns the rights of a pledgee of the original vendee; and whether the case should have gone to the jury depends, in a measure at
But, in respect of the last proposition, there is a difference between the case of commercial paper and that of a sub-vendee or pledgee of ordinary chattels, which may have cbme into the possession of his vendor or pledgor under such circumstances that a previous vendor is entitled to rescind or avoid the sale. In the latter case, the sub-vendee or pledgee is not protected by the mere want of knowledge of the circumstances which impeach the title of his vendor or pledgor; he will not get a good title, if there are such circumstances as would put an ordinarily prudent business man upon inquiry. Upon this subject, this court, in a case analogous to the one now before us, has distinctly approved the following instruction: “If the jury believe from the evidence that Hook [the original vendee] obtained from plaintiffs [the original vendors] any of the books
In the recent case of Price v. Lederer, 33 Mo. App. 426, the original vendor of goods brought an action of replevin against a sub-vendee, and recovered on a collection of facts which are, in many respects, analogous
We conclude in the present case that, by analogy to the rule respecting commercial paper, above stated, when a state of facts was made to appear, warranting the inference that the furniture company made this purchase of goods intending not to pay for them, the burden of proof was cast upon the defendant Yette, of showing in a general way that he purchased the goods in good faith for value, and in the ordinary course of dealing; after which it would be incumbent on the plaintiffs to show a state of circumstances warranting the conclusion that he either had knowledge of the intent with which the goods were purchased by the furniture company, or knowledge of facts sufficient to put an ordinarily prudent and sagacious man upon inquiry in respect of that matter. Of course, the plaintiff’s evidence may have furnished a collection of facts relieving him from the burden of proving in a general way that he was an innocent purchaser. But the question, in the largest sense is, .whether the whole collection of facts, put in evidence by the plaintiffs, would have rendered it not unreasonable for the jury to infer that' he was not an innocent purchaser within the meaning of the rule above stated.
In solving this question, the jury would be entitled to take into consideration the fact of Yette’s knowledge, or means of knowledge, of the financial condition
We, therefore, hold that the court committed error in refusing to submit the question to the jury, and in directing a verdict for the defendants.
The judgment will be reversed, and the cause remanded.