Moore v. Diament

41 N.J. Eq. 612

• Court: Supreme Court of New Jersey
• Decided: June 15, 1886
• Status: Published

Opinion

The opinion of the court was delivered by

Reed, J.

Horace Hammell confessed judgments severally to the respondents, the defendants below. Upon these judgments executions were issued, and a lot of property used in the business of draying was levied upon as the property of Hammell. Moore then filed his bill in this case against the said judgment creditors to restrain the sale under said executions. Moore claimed by his bill that he, and not Hammell, was the owner of said goods. He sets up that Horace Hammell was engaged in the business of drayman in Philadelphia, with his principal stables in Camden, where he had a large number of mules, horses, wagons &c.

He says that about June 1st, 1879, he, Moore, having been employed as the clerk and book-keeper of said Hammell, purchased a one-half interest in the business for the sum of $5,000, •$3,000 of which he paid in cash, and the balance was to be paid out of the profits of the business.

He further says that he permitted his share of the profits to remain in the business until June 1st, 1880, when it amounted to over $3,000, and on June 1st, 1881, it amounted (after deducting $15 a week, for living expenses) to $4,500. That on the 6th of December, 1881, Hammell sold him ,the stock used in said partnership business for the sum of $2,958.47, the amount then due after payment of the $2,000 yet due for his interest in the partnership.

By virtue of this agreement for the sale of the said stock, Moore claims title thereto against the judgment creditors of Hammell, and asks the restraining order of the court of chancery to protect his property against a sale under their executions.

The vice-chancellor refused this relief. In a very full and exhaustive review of the facts surrounding the transactions between Moore and Hammell, he found that the alleged partnership •and sale was a fraudulent contrivance to defeat the creditors of Hammell. In this conclusion I concur. There was no written •evidence of the existence of the partnership until December 6th, 1881, at the date of the alleged sale. Hammell was then hopelessly insolvent, and soon after gave the bonds with warrants to confess judgments, upon which judgments were entered. The existence of any partnership was not revealed by any change in the business, in any sign, or any important- revelation, by Moore ■or by Hammell.

The evidence of the payment of $3,000 in cash by Moore to Hammell is not credible, under the circumstances. He has a receipt from Hammell for $500. The balance he says was paid within a few days thereafter. He had previously been working for Hammell for $15 a week, and supporting himself and wife.. He says that he had made some money in speculations in oil and railroad stock and in commissions on the sale of one or two houses. But Ridgway, through whom the speculative enterprises-were conducted, is not called. There is no testimony to corroborate his story as to the source of this large sum, and I am constrained to regard it as incredible. In this most important point of the complainant’s case, such corroborative evidence as could,, if the story was true, have been produced, or its absence accounted for, is entirely neglected. I conclude that the arrangement of December 6th, 1881, was fraudulent, and that the appellant was-not entitled to relief.

The counsel of the appellant complains, however, that the decree, instead of merely dismissing the bill and dissolving the-preliminary injunction, proceeded to grant affirmative relief to the respondents. A glance at the proceedings taken during the progress of the cause will disclose facts which gave the court of chancery the right to deal with the subject-matter of the litigation. The bill prays that a receiver may be appointed to receive the moneys arising from the sale of the chattels, in lieu of an injunction of the sale, if the chancellor should deem such course equitable. Theodore B. Gibbs, the sheriff of Camden county, was appointed receiver. On the 10th of January, 1882, on application of the counsel of the complainant, it was ordered that the complainant should have leave to use the chattels &c., in the possession of the receiver, upon terms that he give bond, with security, for the return of them, when ordered by this court, in-as good condition and repair as the same now are, loss by unavoidable accident alone excepted, and that said Moore should be at the expense of keeping, caring for and keeping in repair all of the said goods and chattels during all the time of his using the same. Under this order, made at the instance of the appellant, the property was delivered to him, to be used until the further order of the court. By this conduct on the part of the appellant, he submitted himself to the control of the court, in respect to the use and return of the goods. The court could not do otherwise than to make such an order as would place the judgment creditors in the position they would have occupied had the chattels not been delivered to the appellant. The terms upon which they were handed over to Moore were designed to effectuate that object.

The court of chancery had the right to make such order as would place the parties in statu quo. The decree, as made, however, after reciting that one or more of the horses had been sold or disposed of, ordered that appellant pay to the receiver the .sum of $4,683.50, the value of said chattels, as appraised by the appraisers, duly appointed by Gibbs, with interest from the time the goods were delivered to said appellant. Since then it has been also ordered that the said Moore, within three days after the service of a copy of the said order, return to the receiver all the chattels received by him under the original order, and the receiver and sheriff are by said order directed to appraise and sell ■the same.

I am constrained to adopt the conclusion that the order that Moore should pay the appraised value of the chattels with, interest, during the term he was using them, is too stringent.

The obvious reason why they were handed over to Moore was to preserve the chattels, and to avoid the expense of their keeping. The degree of his responsibility was fixed by the terms of the order by which he got the possession.

He was to feed the animals, and care for the other chattels, .and was to be allowed no reduction for the usual wear, but was to be allowed a deduction for any loss resulting from unavoidable accident. He is to account to the receiver for the value of the goods at the time they came into his possession, less loss of any by unavoidable accident. The appraisement made by the sheriff’s .appraisers is not evidence of this value. If the property has been sold, then the difference between the proceeds of such sale .and such value of the property as ascertained is the standard of Moore’s liability.

I think the decree should, in this feature, be modified, and the •cause be remitted to the court of chancery for an ascertainment ■ of the value of the goods as above indicated.

Decree unanimously reversed.