158 Ky. 369 | Ky. Ct. App. | 1914
Opinion of the Court by
Affirming.
Plaintiff, T. B. Lucas, brought this action against defendants, F. T. Hagedorn, Yetta Plagedorn, Hannah Silver and) William Shubinski, to recover on two promissory notes, dated March 8, 1911, each for the sum of two thousand dollars, and payable respectively in one and two years from date.
During the progress of the case, F. T. Hagedorn died, and the action was not revived. On final hearing, plaintiff recovered judgment against William Shubinski for $1,250, and the action was dismissed as to Yetta S. Hagedorn and Hannah Silver. Plaintiff appeals.
The sole consideration for the notes was the sale and transfer by plaintiff of his produce and poultry business, which he was then conducting in Lexington, Kentucky, under the style of the Lexington Produce Company. The tangible assets actually transferred under the contract of sale amounted to only twelve hundred andl fifty dollars, the remainder of the consideration, or twenty-seven hundred and fifty dollars representing the good will of the business.
In addition to a plea of coverture and suretyship by Mrs. Hagedqrn and Mrs. Silver, defendants defended on the ground that the sale was obtained by fraud and misrepresentation ; that there was a failure of consideration to the extent of $2,750; that in derogation of the good will
According to the evidence for the defendants, F. T. Hagedorn approached the plaintiff with a view of purchasing the latter’s business. After several changes in the price, plaintiff agreed to turn over to Hagedorn, the eggs, poultry and chickens on hand at invoice price, $630 ;• a horse and wagon, and the fixtures, valued at $250; and the sum of $370 in cash; and Hagedorn agreed to execute to plaintiff the two notes in question, with his wife, •Yetta S. Hagedorn, and his sister-in-law Hannah Silver, and William Shubinski, as sureties. The contract was thereupon drawn, dated March 8, 1911. Plaintiff was the party of the first part, and Yetta S. Hagedorn was party of the second part. By the contract, plaintiff was to turn over to second party his produce and commission business together with all fixtures and appurtenances, including a lease for five years. He^also bound himself not to engage in the poultry or produce business in Lexington or Fayette County, either directly or indirectly, and that he would not buy for himself or others, or sell for himself or others, any merchandise or stock of produce similar to that handled by the party of the second part. This provision was to remain effective for five years. The contract provided, however, that plaintiff should have the right to handle and sell eggs and poultry in connection with any retail grocery business which he might establish. He also bound himself not to accept employment from any commission or produce firm in Lexington or Fayette County, and not to solicit business for any such firm in said city or county, except the party of the second part. This contract was signed by plaintiff, and by Yetta S. Hagedorn “by F. T. Hagedorn.”
The defendants all say that F. T. Hagedorn was the purchaser and being accustomed to doing business in his wife’s name, he had the first contract drawn in her name; he had no authority from his wife to sign her name to the contract. After the contract was delivered and the business turned over to F. T. Hagedorn, plaintiff desired to consult his attorney in regard to the contract and notes which had been delivered to him. On his being advised that it would be better to have the contract signed by Mrs. Hagedorn and also by Mrs. Silver, as neither would be bound on a note if, as a matter of fact, they were both sureties, the second contract was drawn up and executed by the parties several days later.
Before making the sale, plaintiff told F. T. Hagedorn in the presence of Enoch Grehan, that he had made $16,-000 out of the business in four years. After making the sale, plaintiff told a number of parties that he had sold out to F. T. Hagedorn, and asked them to trade with him. He also assisted a man named Daniels in making sale of produce and poultry; and went into the grocery business with his brother-in-law sometime during the summer of 1911, and sold large bills of goods to John Hutchinson at less than Hutchinson could purchase them from others.
It was further shown that plaintiff' started in the business as a bookkeeper for Wade & Sommer; Wade withdrew from the business which was continued by Sommer, who went to Arkansas and left plaintiff in charge. Plaintiff ran the business as agent for Sommer until he finally purchased it. This trade was closed about April 7, 1910, not quite a year before the sale in question. For a few months prior to that time, he hadl taken charge of the business for the purpose of paying to T. C. Fuller and the Lexington Banking & Trust Company an indebtedness due them by Sommer. On April 16th and on April 19th, 1909, he wrote his employer that there was not very much profit in the business, and advised him to make a sale of it. A few weeks later, he wrote his employer that everything was dead in Lexing
According to the evidence for the plaintiff, he sold the business to Mr. Hagedorn for Mrs. Hagedorn. The contract and notes were presented to him March 8, 1911. Plaintiff took them to Mr. Duncan, his attorney, for the purpose of having him look over them. On being informed that the contract should be signed by Mrs. Hagedom herself, and that Mrs. Silver’s name added no strength to the note, and that Mrs. Hagedorn and Mrs. Silver had better buy the business themselves, he then went to see F. T. Hagedorn in regard to it. Certain modifications in the contract were made by Mr. Duncan. Plaintiff showed the modified contract to Hagedorn, who said he would go and see Mrs. Silver and find out if she would not take an interest in the business. On March 9, Hagedorn took the contract to Mr. Duncan, and returned with it to plaintiff’s place of business. Mr. Melvin and Mr. Biddow were present at the time. Plaintiff told Mr. Hagedorn he would not deliver the business until the contract was corrected. Hagedorn returned with the two contracts signed by Mrs. Hagedorn and Mrs. Silver saying one was for himself and the other was for plaintiff. Thereupon, he turned the business over to Hagedorn. Two or three other witnesses who claimed to have been present testified that Mr. Hagedorn submitted the original contract and notes to plaintiff and plaintiff refused to turn over the business to him and told him he would have to see his lawyer. Plaintiff denies having told Mr. Hagedorn and Mr. Grehan that he made $16,000 out of the business in four years before making the sale; he admits having made this or a similar statement after the business was transferred. He further testified that he had actually made this amount, and claimed to have the property on hand representing this amount. He and Daniels testified that he merely went by Daniels’ booth and occasionally assisted Daniels when he was busy, and that he received no compensation for this, except an occasional chicken. He further testified that he had not accepted employment from any commission or .produce concern in Lexington or Fayette County and had not directly or indirectly bought or sold for others; that the ohly reason he was anxious to make the sale was that he was a very sick man and the doctor had told him he would not live if he continued in that business. On cross ex
It also appears that some months after the sale, a corporation was formed, and in this corporation, Mrs.
Section 2127, Kentucky Statutes, provides in part as follows:
“No part of a married woman’s estate shall be subjected to the payment or satisfaction of any liability, upon a contract made after marriage, to answer for the debt, default or misdoing of another, including her husband, unless such estate shall have been set apart for that purpose by deed of mortgage or other conveyance; but her estate shall be liable for her debts and responsibilities contracted or incurred before marriage, and for such contracted after marriage, except as in this act provided.”
No part of Mrs. Hagedorn’s or Mrs. Silver’s estate was set apart by mortgage or other conveyance. Therefore, their liability turns on whether they were principals or mere sureties in the transaction. Counsel for appellant argues with great force that the following facts show clearly that Mrs. Hagedorn and Mrs. Silver were principals and -not sureties. The notes were signed in blank by them, and turned over to Mr. Hagedorn as their agent. He himself had the first contract drawn up. In this contract Mrs. Hagedorn was named as a purchaser. Appellant then declined to carry out the sale until he consulted his attorney. Thereupon the second contract was drawn. This contract was signed by both Mrs. Hagedorn and Mrs. Silver. Not until then would appellant turn the business over. In addition to these facts, it appears that later on, when the corporation was formed, Mrs. Hagedorn and Mrs. Silver both received 25 shares of stock in that corporation, while Mr. Hagedorn received only one share. It is therefore insisted that not only was the sale made to them, but they continued to
.
On the other features of the case we see no reason to disturb the finding of the chancellor.
Judgment affirmed.