Nebraska Moline Plow Co. v. Klingman

66 N.W. 1101, 48 Neb. 204, 1896 Neb. LEXIS 18
CourtNebraska Supreme Court
DecidedApril 21, 1896
DocketNo. 6543
StatusPublished
Cited by1 cases

This text of 66 N.W. 1101 (Nebraska Moline Plow Co. v. Klingman) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Nebraska Moline Plow Co. v. Klingman, 66 N.W. 1101, 48 Neb. 204, 1896 Neb. LEXIS 18 (Neb. 1896).

Opinion

Rag-an, C.

In the district court of Webster county the Nebraska Moline Plow Company sued O. C. Klingman and A. D. McNear, a partnership doing business as Klingman & Co., at law to recover $1,918 which the plow company alleged was owing to it from Klingman & Co. At the time of bringing this suit the plow company caused an attachment to be issued and levied upon a stock of goods, consisting of buggies, wagons, and farming implements, which the plow company alleged was the property of Klingman & Co. At the time the attachment was issued and the property seized $275 only of the debt sued for, and for which the property was attached, was due. The district court, on motion of Klingman & Co., discharged this attachment, and to reverse that order the plow company prosecutes here a petition in error.

The plow company alleged in the affidavit made to procure the attachment that “said defendants have sold, conveyed, and otherwise disposed of their property, with a fraudulent intent to cheat • and defraud their creditors and to hinder and delay them in the collection of their debts.” The affidavit alleged that Klingman & Co. had done three things which amounted to a fraudulent disposition of their property with intent to defraud and delay their creditors: (1) That Klingman & Co. had executed a chattel mortgage for $900 on a portion of their stock of goods to a brother of one of the partners; (2) that Kling-man & Co. had turned over to a bank in Webster county bills receivable belonging to them of the par value of $4,100. An examination of the evidence preserved in the bill of exceptions shows that these two averments of the [206]*206affidavit are entirely without foundation. Klingman & Co. at no time, so far as the record shows, ever mortgaged any of their property to a brother of one of the firm, and the disposition made of the bills receivable of Klingman & Co. to the bank in Webster county was made to secure debts owing by Klingman & Co. to the bank. The third act, and the one relied on in the argument here, done by Klingman & Co. which the affidavit alleges was done for the fraudulent purpose of defrauding and delaying their creditors, was that on the 24th day of July, 1893, they sold their stock of merchandise to one McClure. The sale of the stock of goods at that time to McClure is admitted, and we are thus brought to the consideration of the only question in the case, namely: Does the evidence sustain the finding of the district court that this sale to-McClure was not fraudulent; neither made nor accepted by the parties thereto with intent to defraud or delay the creditors of Klingman & Co.?.

Section 20, chapter 32, Compiled Statutes, provides: “The question of fraudulent intent in all cases arising under the provisions of this chapter shall be deemed a question of fact and not of law, and no conveyance or charge shall be adjudged fraudulent as against creditors or purchasers solely on the ground that it was not founded on a valuable consideration.” This statute made the issue considered by the distinct court and the issue presented here only one of fact, namely: What was the motive, the intention, which actuated Klingman & Co. and McClure in making the, sale?

The evidence on behalf of the plow company tends to show that at the time the sale was made by Klingman & Co. to McClure the former were insolvent; that a check of theirs given to the Moline Plow company had gone to protest and that some of their notes had been dishonored; that McClure had very little property subject to execution; that Klingman & Co. were doing business in Blue Hill, in Webster county; that on Sunday night prior to the sale, McClure, Klingman, and McNear met in the city [207]*207of Hastings; that the trade was there talked over; that a lawyer was consulted about the trade; that on Monday morning, at Blue Hill, McClure and Klingman made an invoice of the goods; that McClure then paid Klingman & Co. $200 in cash and executed his notes for the remainder of the purchase price of the stock, the total price agreed to be paid being about $4,000, the fair value of the goods; that no bill of sale of these goods was made by Klingman & Co. to McClure; that Klingman remained in the place of business of Klingman & Co. after the sale, the same as before it; that McClure expected and intended to pay Klingman & Co. the notes he had given them for the implement stock out of the proceeds of the sale of such implements, and that Klingman & Co. had turned over the notes received from McClure to a brother of one of the firm to put them beyond the reach of the firm’s creditors.

The evidence on behalf of Klingman & Co. tended to show that McNear’s interest in the business was about three times as much as that of Klingman;* that McNear lived in the city of Blue Hill; that he was in the habit of spending his Sundays in the city of Hastings; that Kling-man had the active management of the copartnership; that McNear was in the employment of a manufacturing company; that he was traveling for that company at a salary of $1,200 a year and expenses; that he had been so traveling for some years prior to the date of the sale to McClure; that in the spring of that year someone had reported to the manufacturing company that he, McNear, was neglecting its business and devoting too much of his attention to the copartnership affairs of Klingman & Co.; that the manufacturing company called McNear’s attention to this; that McNear then talked to McClure about buying out Klingman & Co.; that on the Sunday preceding the sale McNear was stopping at Hastings as' usual on Sundays; that McClure came to Hastings on that Sunday not knowing that either McNear or Klingman was there; that he was then and had been for some time in [208]*208the employment of a mowing or reaping-machine company, and traveling over the country setting np their machines; that the time of his employment with the machine company had about expired; that on this Sunday, after reaching Hastings, he met Klingman on the street; that afterwards he and Klingman and McNear met and the proposition to sell to McClure was again discussed; that they all went to a lawyer’s office and counseled with him as to whether a bill of sale was necessary, and were advised that it was not; that on Monday morning McClure and Klingman returned to Blue Hill, invoiced the goods, McClure paid the $200 in cash, executed his notes for the remainder of the purchase money, and took possession of the stock; that Klingman & Co., at the time they made the sale, were not insolvent; that the check of $50 made to the plow company which had been protested was subsequently, before the bringing of the attachment suit, paid; that the assets of Klingman & Co., at a fair valuation, exceeded by several thousand dollars their total liabilities; that the real object and motive of the sale was that McNear might remain in the employ of the manufacturing company for whom he was working; that McClure was worth in the neighborhood of $3,000 at the time he purchased the stock; that he was well acquainted with the character of the business conducted by Klingman & Co., and that he possessed in the banks of Blue Hill an excellent credit; that the notes given by McClure to Klingman & Co. had never been indorsed or transferred; that they were produced on the taking of the evidence to discharge the attachment and were still owned by Klingman & Co.

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Related

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68 N.W. 362 (Nebraska Supreme Court, 1896)

Cite This Page — Counsel Stack

Bluebook (online)
66 N.W. 1101, 48 Neb. 204, 1896 Neb. LEXIS 18, Counsel Stack Legal Research, https://law.counselstack.com/opinion/nebraska-moline-plow-co-v-klingman-neb-1896.