Saint Louis Clay Products Co. v. Christopher

140 N.W. 351, 152 Wis. 603, 1913 Wisc. LEXIS 118
CourtWisconsin Supreme Court
DecidedMarch 11, 1913
StatusPublished
Cited by10 cases

This text of 140 N.W. 351 (Saint Louis Clay Products Co. v. Christopher) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Saint Louis Clay Products Co. v. Christopher, 140 N.W. 351, 152 Wis. 603, 1913 Wisc. LEXIS 118 (Wis. 1913).

Opinion

TimxiN, J.

Tbe plaintiff, an unlicensed foreign corporation, brought this action to recover upon a contract made by tbe defendant with it for tbe purchase of sewer pipe. There was due thereon from defendant at tbe time of entry of judgment tbe sum of $3,009.05, excluding offsets. A jury was waived and this sum found by tbe court to be due to plaintiff. Tbe contract was in writing, made in Wisconsin by a traveling representative of plaintiff, and tbe merchandise sold was in St. Louis, Missouri, and to be shipped from there to tbe defendant in Wisconsin. Tbe transaction was therefore one of interstate commerce and no objection upon tbe ground that tbe contract was void under sec. 17705, Stats., can prevail.

Soon after beginning this action tbe plaintiff caused a writ of attachment therein to be issued against tbe property of defendant, and tbe amended affidavit in support of this attachment averred (1) that tbe affiant bad good reason to believe that tbe defendant bad assigned, conveyed, disposed of, or concealed, or was about to assign, convey, dispose of, or conceal, bis property or some part thereof with intent to defraud bis creditors; (2) that tbe defendant fraudulently contracted tbe debt and incurred tbe obligation respecting which tbe action is brought; (3) that tbe defendant was about to abscond from tbe state; (4) that tbe defendant was not a resident of tbe state. Tbe defendant traversed this affidavit, prevailed on the traverse, and upon evidence tbe court found defendant’s damages for such wrongful attachment amounted to $2,940.65, and also allowed two counterclaims growing out of alleged breach of tbe contract by plaintiff aggregating $375.68, making, with costs on traverse of tbe affidavit for attachment and a small allowance of interest, $3,359.82. These damages wholly offset tbe allowance to the plaintiff of [606]*606$3,009.05 and $96.39 costs, leaving a balance of judgment of $223.79 in favor of tbe defendant. The property seized on this attachment consisted mostly of sewer pipe, lumber, and cement and was appraised at $2,396.16. This attached property was offered by the sheriff at public sale as perishable property pursuant to an order of a court commissioner on April 1, 1911, and sold for $709.

In order to obtain the contract from the city the defendant was required to give a surety bond. He did so and secured this surety by an indemnity agreement by which he assigned, transferred, and conveyed to the surety all his right, title, and interest in and to all the tools, plant, equipment, and materials of every nature and description that he then had or might thereafter have upon said work, including materials purchased for or chargeable to said contract which might be in process of construction or in transportation to said site, and all his right in and to all subcontracts, etc., and all deferred payments and retained percentages, and all moneys and properties due to him at the time of any breach or default or that might thereafter become due. This was in the nature of a chattel mortgage. It was not recorded in the-office of the city clerk.

The appellant quotes and relies upon the ancient statute relating to change of possession in case of sales (sec. 2310, Stats.), with its presumptions, but we do not consider this statute at all applicable to conveyances of chattels by way of mortgage, which are governed by sec. 2313. The findings of the circuit court sustaining the traverse of the affidavit for attachment are well supported by evidence so far as these issues presented questions of fact. The evidence of fraudulent intent on the part of the defendant is almost wholly lacking and the burden of proof was upon the plaintiff to support the aver-ments in his affidavit for attachment. Lord v. Devendorf, 54 Wis. 491, 11 N. W. 403; Messersmith v. Devendorf, 54 Wis. 498, 11 N. W. 906; 4 Cyc. 796 and cases; Id. 804. [607]*607The issues thus raised are not whether the creditor had reasonable cause for believing that grounds for attachment existed, but whether such grounds did in fact exist. 4 Cyc. 772, 773.

In Lord v. Devendorf, supra, it was ruled that the intent to defraud could not be inferred from the mere fact that the debtor made a general assignment for. the benefit of his creditors, nor from this and the additional fact that in such assignment he preferred some of his creditors to others and that he turned out property in payment of certain of his creditors after the levy of the attachment and before the execution of the assignment. Other evidence is collected in the opinion and held insufficient to constitute such clear preponderance of evidence as to require this court to reverse the order of the circuit court sustaining the traverse.

In Wachter v. Famachon, 62 Wis. 117, 22 N. W. 160, it was also held that the mere fact that a debtor had made a conveyance or mortgage within sixty days prior to a general assignment and with intent to prefer a particular creditor is not in itself evidence of an intention to defraud creditors under this attachment statute, although there existed a statute which made the sale, mortgage, etc., by an insolvent debtor of his property within sixty days prior to the making of an assignment for the benefit of his creditors and in contemplation thereof void and of no effect. It was said that this prevented preferences to the extent mentioned, but did not furnish proof sufficient to support an attachment on the ground of fraudulent conveyance or disposition of property. Intent to der fraud a creditor is an essential element of this subdivision of the attachment statute under consideration, and whether or not such intent exists is a question of fact. Palmer v. Hawes, 80 Wis. 474, 50 N. W. 341; Curtis Bros. & Co. v. Hoxie, 88 Wis. 41, 59 N. W. 581. Anderson v. Patterson, 64 Wis. 557, 25 N. W. 541, was a case of traverse of the affidavit for attachment sustained in the circuit court and an appeal to this [608]*608court. There was an unrecorded chattel mortgage upon the stock of goods, and the mortgagor, with the acquiescence of the mortgagee, 'was selling the goods and applying the proceeds to the support of his family and to the purchase of other goods. The order of the circuit court was reversed. But the court inferred from this mode of dealing between the parties an agreement between the mortgagor and mortgagee that the property might be so disposed of by the mortgagor, and hence that fraud in fact was proven. It is also noticeable that the chattel mortgage statute does not declare an unrecorded chattel mortgage fraudulent, but merely invalid as against all persons except the parties thereunto. A statute declaring a conveyance invalid does not necessarily make such instrument fraudulent or a ground for attachment. First Nat. Bank v. Rosenfeld, 66 Wis. 292, 28 N. W. 370; sec. 2313, Stats. A mortgagor cannot ordinarily control the filing of the chattel mortgage. That duty is primarily cast on the mortgagee if he wishes to validate his mortgage as against third persons. But the attachment statute authorizes an attachment to issue on account of the fraud of the mortgagor. If the mere omission of the mortgagee to record the chattel mortgage were to be treated as constructive fraud on the part of the mortgagor and this constructive fraud sufficient to support an attachment of the property of the latter, the order in this case sustaining the traverse must be reversed. But such is not the law. This brings us to the case of Ryan D. Co. v. Hvambsahl, 89 Wis. 61, 61 N. W. 299. That was a case where the circuit court sustained the attachment, and upon appeal to this court the order was affirmed.

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Bluebook (online)
140 N.W. 351, 152 Wis. 603, 1913 Wisc. LEXIS 118, Counsel Stack Legal Research, https://law.counselstack.com/opinion/saint-louis-clay-products-co-v-christopher-wis-1913.