99 Neb. 803 | Neb. | 1916
William Niklaus, as trustee of the bankrupt estate of the Lincoln Implement & Transfer Company, commenced this action in the nature of a creditor’s bill in the district
The record discloses that the Lincoln Implement & Transfer Company was duly adjudged a bankrupt, and the plaintiff in this action was appointed as trustee in bankruptcy; that before the implement company was adjudged a bankrupt, and on or about the 9th day of May, 1911, the defendant George F. Lessenhop executed a bill of sale of the entire stock of the bankrupt concern to the defendant Isaac Deardorf and transferred and assigned to him the entire amount of the capital stock of the implement company. The agreed inventory of stock amounted to $11,000. It appears that Lessenhop had, previous to that date, acquired all of the capital stock of the implement company, and was its president, and had full control of tlie affairs of the company; that at the time the bill of sale was executed and the stock of the implement company was assigned to Deardorf the company was insolvent and was indebted to a large number of creditors to the amount of $11,705.11. The testimony also shows that when the bill of sale and assignment of the capital stock was exe
Appellants contend that, because the Lincoln Implement & Transfer Company by its charter was authorized to do both a wholesale and retail business, the “Bulk Sales Law” has no application to this case, and that the assets of the company sold-in violation of the provisions of the section above mentioned are not trust funds. There are some adjudications in other jurisdictions which seem to sustain this contention; but, in construing the section of the statute above mentioned, we held in Appel Mercantile Co. v. Barker, 92 Neb. 669, that: “One who obtains possession of a stock of merchandise pursuant to a purchase thereof in bulk, in violation of the statute, will be held to be a trustee for the benefit of the creditors of his vendor, and liable as garnishee.” In Kohn v. Fishbach, 36 Wash. 69, it was held: “One who buys a stock of merchandise in bulk, without complying with the statute requiring him to demand
Appellants are liable for other reasons than the “Bulk Sales Law.” Deardorf obtained the transfer of the goods without paying any money, and knew of the indebtedness of some $9,000 or $10,000, and in taking over the business, although he claims he did not assume any liability to the creditors, the record discloses that he gave no attention or consideration whatever to the liabilities of the Lincoln Implement & Transfer Company. Such being the case, he must be held to have entered into a transaction, the effect of which was to hinder, delay and defraud the creditors of that company. Miller obtained his share of the stock of goods without any concern as to the creditors. The same may be said of Wingard and Lindsey. Their purchases were in violation of the “Bulk Sales Law,” and therefore they are each liable for the amount of the goods purchased and converted by them. They acted without regard to the rights of creditors, and therefore, to say the least, they participated in hindering and delaying the creditors of the Lincoln Implement & Transfer Company. The transaction must be held fraudulent as to all of the defendants. It is also contended that the “Bulk Sales Law” is unconstitutional. That question was before the court in Lee v. Gillen & Boney, 96 Neb. 730. The law was there assumed to be constitutional and valid. The question of the validity of the law was directly passed upon in Appel
It is finally contended that the decree is grossly excessive and is not supported by the evidence. The record discloses, however, that when I) ear dor f purchased the assets of the implement company an inventory was taken and the value of the stock was agreed upon between the purchaser and the vendor. Deardorf conveyed certain property to Lessen-hop in payment, the value of which he claimed was largely in excess of the amount of the inventory. When he sold the property to the other defendants, he obtained the inventory price of the same. The amount of the decree as to the several defendants is well within the inventory of the assets of the implement company. Therefore defendants’ contention cannot be sustained.
As we view the record, the judgment of the district court was right, and is
Affirmed.