Sampsell v. Anches

108 F.2d 945, 1939 U.S. App. LEXIS 2644
CourtCourt of Appeals for the Ninth Circuit
DecidedDecember 18, 1939
Docket9059
StatusPublished
Cited by13 cases

This text of 108 F.2d 945 (Sampsell v. Anches) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sampsell v. Anches, 108 F.2d 945, 1939 U.S. App. LEXIS 2644 (9th Cir. 1939).

Opinions

WILBUR, Circuit Judge.

This action was brought by the trustee in bankruptcy for the estate of Sam Gold, bankrupt, to recover the value of certain merchandise purchased by the defendants and appellees from the bankrupt, Sam Gold, within four months of the date of bankruptcy. It is claimed by the appellant that the sales of the merchandise to the appellees were made with intent on the part of the bankrupt to defraud his creditors and that the appellees, as such purchasers, also intended to defraud the creditors of the bankrupt, that the purchases by them were not made in good faith or for a present fair consideration (11 U.S.C.A. § 107, sub. e), and that the purchasers were not bona fide holders for value prior to the date of adjudication (11 U.S.C.A. § 110, sub. e).

The plaintiff alleged that the fraudulent scheme conceived and executed by the bankrupt was one by which he purchased great quantities of merchandise on credit without any intent to pay the creditors from whom he had purchased the goods but, on the contrary, with intent to quickly sell the goods for cash and appropriate to his own uses the cash thus procured and, then, to go into bankruptcy.

A promise to pay for goods purchased without an intention to do so is a fraud especially denounced by the statutes of California (Cal.Civ.Code §§ 1572, 1710) and in most jurisdictions such a promise is itself fraudulent.

[947]*947The complaint alleges 'in detail the means adopted to carry out the scheme of the bankrupt to appropriate to his own use the goods purchased by him on credit. That scheme, briefly, is as follows:

Appellant was in the business of jobber of what is known to the trade as distress merchandise. He had thus established a line of credit. He purchased in a different location in Los Angeles a retail business, in the retail district, for the price of $11,-000. He immediately began purchasing goods on credit in many eastern cities and in Los Angeles, in quantities wholly disproportionate to the business he had purchased. Some of the merchandise purchased by him was resold by him to appellees, almost as soon as it arrived, for a 31.94 per cent discount below the cost to him. It is alleged that goods which were purchased by the bankrupt for $34,102.47 were immediately resold at Los Angeles to the appellees for $23,208.47; that in many instances goods received at the bankrupt’s place of business in Los Angeles by freight from the eastern cities where they had been purchased were immediately transshipped to the defendants’ place of business in Seattle.

It is alleged that throughout the period when the sales to the appellees were being made, the retail store purchased by the bankrupt was doing a large business, and that the records of the sales of that store (and of another store of the bankrupt) were destroyed to conceal the amount of the daily receipts.

It is alleged that the bankrupt utilized the money received from the appellees to make partial payments to creditors in and around Los Angeles to prevent them from suing on their claims or attaching his property and thus giving the bankrupt an opportunity to appropriate and conceal the cash derived by him from sales at his retail stores.

It is admitted in the pleadings that the purchase money paid by the defendants was applied to outstanding obligations of the bankrupt.

It is alleged that during the period from January 1, 1937 to July 13, 1937, the defendant purchased $168,741.99 worth of goods; that he made an assignment for the benefit of creditors on July 7th, and that a petition in involuntary bankruptcy was filed with the District Court on July 7, 1937; that the bankrupt’s stock in trade had been depleted to $44,846.

The appellees, before answering the complaint, called for a bill of particulars as to the goods which had been purchased by them. The allegations of the complaint with reference to the goods purchased were very specific but the bill of particulars was much more so. The defendants answered and admitted the purchase of the goods described in the bill of particulars and admitted that the purchase price paid in cash by the defendant to the bankrupt was the amount stated in the complaint ($23,208.-47). The appellees, for lack of information and belief, denied that the goods purchased by them were the same goods which had been so recently purchased by the bankrupt.

The complaint consists largely of allegations of evidentiary matter but it is clear on the whole that the gist of the charge of fraud in the complaint is the purchase of large quantities of goods without any intention of paying therefor, and the specific intent of preventing the purchaser from obtaining relief by the use of the bankruptcy laws.

The case went to trial before a jury on August 1, 1938 and, at the conclusion of the appellant’s evidence on August 5, 1938, the court instructed the jury to return a verdict in favor of the defendants. This ruling was excepted to and designated as a point upon which the appellant intended to rely on appeal. On the presentation of the case on appeal, however, the appellant does not press this point but, on the contrary, concedes that the instruction was proper under the status of the evidence at the conclusion of plaintiff’s case and, consequently, relies upon twenty-five points wherein he claims that the trial court erred in excluding evidence he offered.

In order to consider these points it will be necessary to state more fully the condition of the record but, before doing so attention should be called to the way in which this case is presented to this court.

Judgment was entered August 10, 1938. The case was tried before the Federal Rules of Civil Procedure (Rule 85) became effective (Rule 86) September 16, 1938. 28 U.S.C.A. following section 723c. The record on appeal was made after the new rules became effective, and an attempt was made to comply with those rules, particularly rule 75, in the preparation of the record. The appellant, on November 9, 1938, served a notice designating the portion of the record, proceedings and the evidence to [948]*948be contained in the record on appeal (Rule 75(a). Thereafter, the appellee served a designation of the additional portion of the record, proceedings and evidence to be included in the record. The parties, however, abandoned this method of making up the record and filed a stipulation under the provisions of Rule 75 (f) wherein the parties designated the parts of the record, proceedings and evidence to be included in the record on appeal. This stipulation specified with reasonable certainty the parts of the reporter’s transcript and of the. pleadings and documents to be included in the record on appeal. One of the provisions of this stipulation was that 46 original exhibits be forwarded in accordance with the order of the District Court of November 19, 1938. These exhibits are not designated in any other way than by number. Incorporated in the stipulation is a “note to the clerk of the appellate court”. This note indicates the portions of the reporter’s transcript and supplemental transcript that shall be printed.

Several of the “points” on which appellant intends to rely on appeal relate to the exclusion of exhibits. For instance, point 1 is as follows: “That the District Court erred in excluding from evidence plaintiff’s Exhibit 7 for identification.”

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Sampsell v. Anches
108 F.2d 945 (Ninth Circuit, 1939)

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Bluebook (online)
108 F.2d 945, 1939 U.S. App. LEXIS 2644, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sampsell-v-anches-ca9-1939.