137 Wis. 66 | Wis. | 1908
Lead Opinion
The following opinion was filed September 29, 1908:
This ease, as presented by tbe record, is involved in muck confusion. Certain issues of fact were submitted to tbe jury and other controverted issues were withheld from it, some of them by consent of counsel that the court might find upon them, and others apparently without any consent at all of the attorneys. The issues other than those which were submitted to the jury were: First. Was^ Luckey insolvent? Second. Did the defendant have reasonable cause to believe so ? Third. Did the transaction between the bankrupt and the defendant at the time of the alleged payment constitute a payment or transfer by the bankrupt, or merely an exercise by the creditor of its right in in-vitum to apply its indebtedness on open account to him upon his debts to it? This question was severable in its applica
Error is assigned upon the instruction under which the second question of the special verdict was submitted to the jury. A material and illustrative part of that instruction was as follows:
“The jury are instructed that the words ‘reasonable cause to believe that it was intended to enable the bank to obtain a greater percentage of its debts than other creditors would be able to obtain’ does not mean reasonable cause to suspect such intention. It is not enough that the creditor had some cause to suspect that his debtor did not have sufficient property left to pay an equal percentage to other creditors of the same class, but he must have such knowledge of facts as to induce a reasonable belief thereof, or of circumstances to put him upon inquiry, in order to find that the creditor had reasonable cause to believe that a preference was intended.”
It is contended that the last portion of this instruction is erroneous; that only when the facts known to the creditor ■ are such as would induce a present belief in the ordinarilv
By the Court. — Judgment reversed, and cause remanded for new trial.
Dissenting Opinion
(dissenting). “If a bankrupt shall have given a preference within four months . . . and the person receiving it or to be benefited thereby . . . shall have had reasonable cause to believe that it was intended thereby to give a preference it shall be voidable by the trustee, and he may recover,” etc. Subd. b, sec. 60, Bankr. Act July 1, 1898 (ch. 541, 30 U. S. Stats, at Large, 562, U. S. Comp. Stats. 1901, p. 3445). The trial court in its instructions to the jury construed this statute with reference to its words and with reference to pre-existing rules of law to mean that' neither suspicion that a preference was intended, or doubt on this point, was sufficient to create liability; that the party
Furthermore, it is a rule of construction of statutes that, “in all doubtful matters and when- the statute is in general terms, it is subject to the principles of the common law. It is to receive such a construction as is agreeable to that law in cases of the same nature.” 2 Lewis’ Suth. Stat. Constr. (2d ed.) § 455, and cases. The words “common law” in this respect do not mean the English common law, or common law as distinguished from equity jurisprudence, but the general case law of the forum. “Equality is equity” is also a maxim having some weight in the construction of this statute. Next, this statute has never been construed by the supreme court of tire United States as understood in the ma
“Whether defendant had reasonable cause to believe that Young was insolvent within the meaning of the bankrupt act was a question of fact, and it was chargeable with notice of such fact as reasonable inquiry in view of the circumstances with respect to the debtor’s condition, which were brought home to it, might fairly be expected to disclose.”
I see nothing in tbe case of Suffel v. McCartney Nat. Bank, 127 Wis. 208, 106 N. W. 837, in conflict with tbis view. In tbe last-mentioned case tbe situation presented by tbe findings of tbe court below was first an absolute negation of tbe condition of liability mentioned in that section of tbe banlcruptey act in question; second, an additional finding that there was evidence which might naturally produce, not belief, but a doubt or suspicion, and that doubt or suspicion was such that under the rule of law applicable to fraudulent grantees it would put a reasonably prudent man upon inquiry. Tbe utmost, then, that tbe case presented to tbis court was a condition in which it was settled by the findings •of tbe court below that there was evidence in tbe case of facts which would or might have put an ordinary, reasonable person upon inquiry; but notwithstanding tbis, tbe person sought to- be charged did not have reasonable cause to believe that it was intended to give a preference. These two findings are not inconsistent. Tbe conclusion arrived at in tbe majority opinion assumes that they are always inconsistent and antagonistic. Still I think it quite obvious that in all that large class of cases, of which tbis is one, where evidence of facts sufficient to suggest inquiry is only an item of evidence, tentative and rebuttable as regards tbe final inquiry, it may be and frequently is true that, although tbe jury may from proof of facts sufficient to suggest inquiry infer a reasonable cause to believe that a preference was intended, still they are not bound to do so, but may find, notwithstanding such evidence, from other evidential facts and circumstances that there was no such reasonable cause to believe. Tbe whole subject is very thoroughly and learnedly
To reiterate: Well-established rules permit knowledge or notice of the right of another or of the intention of another to be inferred as matter of fact in most instances, but as a-legal conclusion in some few instances from evidence that the party sought to be charged had knowledge of such facts and circumstances as would put a reasonably prudent person upon inquiry. The majority opinion holds that a proper construction of the bankruptcy act forbids such mode of proving the cognate fact that one had reasonable cause to believe a preference was intended, and for this reason reverses the judgment of the court below. I consider this •construction of the bankruptcy act erroneous, and see nothing in the act itself or in the federal decisions to warrant it. The excerpt from the charge of the court below quoted in the majority opinion is rather incomplete, but, taking the whole charge of the court below, it is in substantial conformity with these rules of evidence, hence the judgment of the court below should be affirmed.
A motion for a rehearing was denied November 27, 1908.