Thompson v. Fuller

8 N.Y.S. 62, 5 Silv. Sup. 41, 28 N.Y. St. Rep. 4, 54 Hun 639, 1889 N.Y. Misc. LEXIS 2171
CourtNew York Supreme Court
DecidedDecember 11, 1889
StatusPublished
Cited by3 cases

This text of 8 N.Y.S. 62 (Thompson v. Fuller) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thompson v. Fuller, 8 N.Y.S. 62, 5 Silv. Sup. 41, 28 N.Y. St. Rep. 4, 54 Hun 639, 1889 N.Y. Misc. LEXIS 2171 (N.Y. Super. Ct. 1889).

Opinions

Learned, P. J.

The action is to recover for goods sold by plaintiffs to defendants Fuller & Co. The ground of the attachment is that defendants Fuller & Co. had assigned property with intent to defraud creditors. The [63]*63Code of Civil Procedure (section 635) authorizes an attachment in three cases: (1) Breach of contract; (2) conversion of personal property; (3) injury to personal property. This case must come under the first. In an action for fraud the remedy is arrest. Section 549. Whether, therefore, the goods were purchased by fraud is not material. Goldschmidt v. Hershorn, 13 N. Y. St. Rep. 560; Strauss v. Lemson, Id. 740. The only question is as to an assignment with intent to defraud creditors. In both applications the plaintiffs state that there are no counter-claims, thus showing that their action is on the contract. Code, § 636, subd. 1. It is only to an action on the contract that there would be a counter-claim.

The affidavit of the plaintiffs avers that they sold goods to the defendants; that they were induced so to do by fraudulent representations; that after said sales of goods the plaintiffs brought a replevin suit to recover such of the goods as remained in defendants’ possession; and that they did recover, and still hold, about $900 in value of such goods. When goods are sold on fraudulent statements by the vendee, the vendor has either of two remedies: He may affirm the sale, and sue for the price, or he may disaffirm the sale, and reclaim the goods; but he cannot do both. “The remedies are not concurrent; and, the choice between them once being made, the right to follow the other is forever gone.” Morris v. Rexford, 18 N. Y. 552. This doctrine was again asserted in Kinney v. Kiernan, 49 N. Y. 164. There it was said that after such rescission of the contract of the vendor on the ground of fraud on the part of the vendee the contract is at an end, and no act of the vendor can revive it. Consequently, after such a rescission an action by the vendor against the vendee is not maintainable. The contract must be rescinded in toto. Wheaton v. Baker, 14 Barb. 594; Stevens v. Hyde, 32 Barb. 171; Matteawan Co. v. Bentley, 13 Barb. 641. In the case of Kinney v. Kiernan the plaintiff had replevied a part of the goods sold, and the court said the action on the contract of sale was gone. The rights of the parties were the same as if there had never been any sale, and the goods had been tortiously taken. The doctrine is again laid down in Moller v Tuska, 87 N. Y. 166, where the plaintiffs brought an action to replevy, on the ground of fraud, goods sold by them. Afterwards they proved their claim in bankruptcy, and received a dividend; but the money paid was subsequently refunded to the assignee. The court held that, as plaintiffs had once elected to disaffirm the sale, they could never afterwards successfully assert a claim against the purchaser on the contract, and that the subsequent transaction with the assignee in bankruptcy had no bearing on the question, because plaintiffs then were bound by their "previous election. See Rodermund v. Clark, 46 N. Y. 354. If a man once determines his election, it shall be determined forever. Com. Dig. “Election,” C. 1, 2.

The affidavit alleged sales on the 14th of December, between the 9th and 17th of January, and on the 28th of January; and it alleges a replevin, February 4th, of so many of said goods as remained in defendants’ possession. This language applies to all the sales, and not specifically to any one; for the allegation is that all of said sales were made on fraudulent representations of defendants. The plaintiffs therefore elected, as appears by their own affidavit, to rescind all of the sales,—to treat the goods sold as being still their own property, just as if there had been no sale, but only a tortious taking; for, if they retook the goods, or any part of them, then they asserted that the goods were still their own, and disaffirmed the sales altogether. They have, therefore, no right of action on the alleged contracts of sale. Such contracts do not exist.

The plaintiffs, in their action of replevin, could have recovered, and perhaps did recover, damages for the taking of those goods of which they did not recover possession. Code, § 1730. If the defendants took the goods tortiously, such taking was, as to each alleged sale, a single act; and it may be [64]*64doubted whether the defendants can be subjected to two actions, in regard to the same act, when a full remedy can be given in one. O'Brien v. Mayor, 28 Hun, 250; Secor v. Sturgis, 16 N. Y. 554.

It does not aid the plaintiffs to aver that this action is based on the fraud. They state in the affidavit a sale of the goods, and the fraudulent statements' which induced the sale. Now, these were the very circumstances of the cases above cited, (Morris v. Rexford, Kinney v. Kiernan, Moller v. Tuska;) and in those cases the principle was applied which has been stated above. The case of Powers v. Benedict, 88 N. Y. 605, is not in conflict. That was an action of replevin against a third party in which plaintiff had taken part of the goods sold. It was held that it was not a defense that plaintiff had proved against the original party a claim in bankruptcy for the residue of the goods. In the present case the replevin was against the original party.

Passing this point, however, we prefer to inquire as to the proof of alleged fraudulent intent; and we consider first the appeal from the order of Mr. Justice Edwards, because both parties were heard before him on their several affidavits, and hence the facts may be thought to appear. The plaintiffs’ allegations are the obtaining of the goods by fraudulent representations of solvency, the executing a mortgage to Morrison, the selling goods at less than the market price, the removing and the concealing of part of the goods. Some of the allegations are based on conversation alleged to have been had by • one of plaintiffs with Morrison.' Morrison, in his affidavit, denies the alleged conversation altogether. He further states that he guarantied to plaintiffs the third bill sold to defendants, which contains the goods afterwards replevied. He denies any intent to defraud, and states that the mortgage was given to secure money actually loaned to the firm by him. The affidavit of Fuller, the purchasing member of the firm, denies making the alleged fraudulent statements, and positively contradicts all plaintiffs’ allegations in that respect. He avers that the money was owing Morrison for which the mortgage was given, and that it was not given with intent to defraud. He denies the statements that goods were sold at less than market price. He says that the goods were sold to pay defendants’ debts. The defendants’ affidavit is simply the affidavit of the person to whom they are alleged to have been sold by other affidavits. The plaintiffs used opposing affidavits. In regard to selling below market price the affidavits are statements of hearsay. Some affidavits are given of the poor quality of collars made by defendants. Now, the argument of plaintiffs is that, as the defendants remained in possession after execution of the mortgage, it was presumptively fraudulent, under 2 Rev. St. marg. p. 136, § 5. This is a mere legal presumption', overcome by proof of good faith and absence "of intent to defraud; and the question of fraudulent intent is one of fact, not of law. 2 Rev. St. 137, § 4. No reason or excuse for not delivering is necessary.

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Related

Thompson v. Fuller
16 N.Y.S. 486 (New York Supreme Court, 1891)
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9 N.Y.S. 950 (New York Supreme Court, 1890)
In re Burrows
4 F. Cas. 840 (D. Indiana, 1877)

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Bluebook (online)
8 N.Y.S. 62, 5 Silv. Sup. 41, 28 N.Y. St. Rep. 4, 54 Hun 639, 1889 N.Y. Misc. LEXIS 2171, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thompson-v-fuller-nysupct-1889.