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be turned over to the trustee; and, if it is not obeyed, the parties under those circumstances are committed to jail for contempt for not obeying the order. But it is perfectly well-settled law that a case may be sufficiently doubtful to prevent the court of bankruptcy from making a summary order in one of those proceedings, although there may be sufficient evidence in the case, such that if it were submitted to a jury on a trial it would justify a verdict against the party, which the court would not feel authorized to set aside. Therefore, it is my opinion that any order made in a proceeding of this kind which does not find the party proceeded against liable to pay over is not a legal bar to a suit brought by a trustee where the evidence can be taken in full, and the jury can pass upon the question.

Now, gentlemen, if the plaintiff's charge is true, you have one of those cases in which it is to be expected that you will have a class of witnesses on all sides who may not be very much relied on. In these cases of bankruptcy failures, where goods are gotten away the day before the petition is filed or a short time before, and they are purchased by people who are in the habit of dealing in goods so obtained, it is not surprising if you find you have to deal with a class of witnesses whose veracity may not be entirely satisfactory. You have to do the best you can in these cases. A trustee in bankruptcy has to do the best he can, and it would not do in such cases if you formed an unfavorable opinion of any of the witnesses to simply say you cannot put any reliance in such evidence, and therefore won't decide anything. It is just this class of cases in which it is the duty of a jury to investigate the case carefully, and to see that justice is done.

Now in this case each of the leading witnesses undoubtedly has a considerable interest in the case. Mr. Joseph has a large interest in this case. Suit is brought against him for a judgment of $5,000 or $6,000, and it is a suit which will affect to some extent his professional standing. Mr. Gilroy has an interest in this case. He has the natural interest of trying to justify himself for whatever has taken place. According to his own statement here, if Joseph isn't responsible for the money he has paid out he is, and so with the goods. Altschul and Von Praag have an interest here. Altschul admits that, knowing that the bankruptcy occurred, he took advantage of the fact that he had this property in his custody to coerce the payment of his claim in full. He stood in the same position as any other creditor, and he has the interest of justifying himself, and defending himself from the charge of willingly taking part in a transaction of this sort. Von Praag is a witness under similar circumstances. The plaintiff claims, in substance, that he is in the business very much like a receiver of stolen goods; that he is in this business of buying up stock from bankrupts, and in aiding them in that manner in cheating their creditors. All these men have these interests, but the mere fact that they may be interested should not prejudice you against them in the slightest degree. You should look at the whole case fairly, candidly, reasonably, bearing in mind the just rights of these defendants, particularly of Mr. Joseph, a man who has been a member of the bar here for many years, and also taking into view the rights of the plaintiff in this case, who represents the creditors of this firm.

It is all a question of fact. The plaintiff has the burden of proof. He must establish his claim by a preponderance of evidence. This is an important case in the sense that all such cases are important. It is important that in bankruptcy cases the parties on the eve of bankruptcy should not be permitted with impunity to hide their property and to transfer it for the purpose of cheating their creditors, and on the other hand it is important to the defendants in this case that no rash or unjust verdict should be found against them, and that care should be taken to insure that the verdict, if a verdict is found against them, is justified by the evidence.

I have been handed some long requests to charge by each counsel in this case. Some of them are correct, and some of them in my opinion are not correct. Some of them I should modify, and charge as modified. I have endeavored to touch upon the subjects to which they refer, and, if there is any subject referred to in them which I have not touched upon, counsel are free to call it to my attention. But I think I will not go over them at length. It would occupy a long time, and the reading of them to the jury would in my opinion tend to confuse the issues in this case and confuse the jury. I therefore decline to charge in the special language of these requests, or otherwise than as I have already charged in respect to the subjects which are touched upon in these requests to charge.

Mr. Furber: May it please the court, I will ask the court to charge the eighth request, which we have handed up to you specifically. That if a transaction is equally susceptible of two presumptions, one of guilt and one of innocence, the presumption of innocence must prevail.

The Court: I so charge.

Mr. Furber: I ask your honor to charge the ninth and tenth propositions, in view of Mr. Elkus' statement to the jury with reference to the goods being sent to Altschul.

(9) That every sale of personal property, unless accompanied by an immediate and continued change of possession of the property sold, is presumptively fraudulent, and that if the jury believe that the bili of sale of March 18th purported to sell all the property now described in it to Rose Korn, it would have been presumptively fraudulent if the property had been left in the possession of Gilroy & Bloomfield.

The Court: I so charge.

(10) That a delivery of an order on a warehouseman or custodian for personal property in the possession of such custodian, with the intent to vest title to the same for whose account the order is delivered, is a symbolical delivery of the property.

The Court: I so charge.

Mr. Furber: The twelfth I will ask your honor to charge. That it is not essential to the validity of a written bill of sale that it should bear a date, and the date on which a bill of sale is delivered may be proved, irrespective of whether it is dated or not.

The Court: That is so gentlemen; I so charge. (13) That the law does not require a written bill of sale to be filed,

and filing it or failing to file it in no way affects its validity or effect.

The Court: I so charge. It certainly does not affect it as between the parties.

(19) I would ask your honor to charge the nineteenth. That there is no evidence when the name of the commissioner of deeds was erased from the assignment of accounts of January 19th, and that no inference adverse to Joseph can be drawn from such erasure.

The Court: Gentlemen, it is for you to say whether there is any evidence. I don't recall any evidence to that effect. I think there is no evidence that Joseph had anything to do with the erasure. He said he ordered it to be erased. I think I shall decline to charge the latter part of that request. It is for the jury to say what inference they will draw from it.

Mr. Furber: May I have an exception to the modification. (20) That such erasure in no way changed the character, validity, or effect of the bill of sale.

The Court: I so charge.

Mr. Furber: I also draw your honor's attention to the order relieving Mr. Joseph from responsibility, and draw your honor's attention to the fact that it was not that we relied upon, but the further provision in that order that it required the Korns, Mrs. Korn and Feinman, to pay over to the receiver the 31 pieces of goods, broadcloth and cashmere, taken from the sponger's, Samuel Altschul, and that is what it required them to do, and they have been charged with that specific property upon that inquiry.

The Court: That order is before you, gentlemen. Give it such weight as it requires.

Mr. Kerfoot: I ask your honor to direct a verdict for the defendant Gilroy for the reason that there has been no proof of the allegations in the complaint of fraudulent intent to hinder, delay, or defraud the creditors of the estate, or that he had any of the assets.

The Court: I deny the motion.

Mr. Kerfoot: I request your honor to charge that the intent to hinder, delay, and defraud the creditors, as alleged in the complaint, is an essential element of this cause of action, and that unless the jury believes from the evidence that such intent actuated Gilroy in these transactions they must find a verdict for Gilroy.

The Court: I so charge.

Mr. Elkus: I ask your honor to charge the jury that in considering the evidence in this case they may take into consideration the fact that the bill of sale which is claimed to be delivered on March 18th bears no date, and was not filed, but remained in the possession of the defendant Joseph until the present time.

The Court: Yes, take it into consideration, gentlemen, with all the other evidence in the case.

Mr. Elkus: I ask your honor to charge the jury that they may, upon the question of whether or not the goods delivered to Altschul were delivered to Altschul for Korn, take into consideration the fact that the goods were stored in the name of Gilroy & Bloomfield, and that the order for the goods which Altschul received is in Gilroy & Bloom..

field's name, and that the receipt which Altschul claims was signed by Richard Smith was also of Gilroy & Bloomfield's goods.

The Court: Yes, gentlemen, it is all a part of the evidence, and proper for you to consider.

Mr. Elkus: I ask your honor to charge the jury that they may take into consideration the testimony elicited from Von Praag as to the financial transactions of Joseph with Von Praag.

The Court: Yes; that is part of the evidence.

Mr. Elkus: I ask your honor to charge that the jury may consider in deciding this case the failure to call Greenberg and Hershman as witnesses on the part of the defendant.

The Court: You may consider it, gentlemen. I shouldn't give it very much weight, it seems to me. I do not see that there is evidence that the defendant has any more special control over Greenberg and Hershman than the other side. No inference should be drawn from the failure to call witnesses, except in those cases where there is evidence which naturally they should produce, and which is in their custody and control to produce.

Mr. Elkus: I ask your honor to charge the jury that in considering the testimony in the case they may take into consideration the fact that on Monday after the petition in bankruptcy had been filed Joseph conversed with Altschul with reference to the merchandise stored at Altschul's place of business, and that Joseph went to Von Praag's place of business with Korn on that day, or whatever day it was they went there.

The Court: Yes; I so charge.

Mr. Elkus: I ask your honor to charge that the jury have the right to disregard the testimony of any witness entirely, if they so desire, if they find that such witness has testified falsely to any material fact.

The Court: Yes, that is so, gentlemen.

Mr. Elkus: I ask your honor to charge the jury that in considering the weight to be given to the evidence of the defendant Joseph in this case they may take into consideration his prior testimony given March 24, 1904, before the commissioner.

The Court: I so charge, gentlemen.

Mr. Palmer: In view of the requests that have been made by Mr. Elkus, I ask your honor to charge the jury in regard to the goods sent to Altschul. They may take into account that it was said by Gilroy in his testimony that the silks and satins sent over on account of Rosie Korn's claim were about the value of $3,000, and it is stated that her claim was between $5,000 and $6,000.

The Court: Certainly.

Mr. Palmer: I ask your honor to charge the jury if they find that the goods sent to Altschul were sent as goods to satisfy the claim of Rosie Korn, it does not matter in whose name they were sent.

The Court: I so charge.
Verdict for the plaintiff for $3,250.

Mr. Kerfoot: I move to set aside the verdict as to the defendant Gilroy, for the reason that it is contrary to the evidence, and for a new trial.

Motion denied. Exception.

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Mr. Furber: I move to set aside the verdict on the ground that it is against the weight of evidence.

Motion denied. A stay of 30 days after entry of judgment granted.

IN RE SHAW.

(District Court, D. Maine. July 5, 1906.)

No. 4,203.

1. CIATTEL MORTGAGES-VALIDITY-TRANSFER OF POSSESSION-SUFFICIENCY

VALIDITY OF LIENS.

A bankrupt, who operated a tannery in Maine, some two years prior to the bankruptcy executed a chattel mortgage to a creditor on all the stock and materials at his tannery and such as should thereafter be acquired. By agreement the mortgage was not recorded, nor was any possession ever taken thereunder. Subsequently the mortgagee made a mortgage to secure an indebtedness to a bank on certain bark at the bankrupt's tannery, to which it had no title unless by virtue of its own mortgage. Also, by agreement, this mortgage was not recorded, but an attempted delivery of possession was made by going to the tannery, scaling the bark, and placing on each pile a small board, having thereon a letter of the alphabet, and then formally delivering each pile to the agent of the bank, who appointed the bankrupt its custodian. There was no visible change of possession, and the bankrupz's trustee took possession of and sold the bark as assets of his estate. Held that, under Rev. St. Me. c. 93, § 1, which provides that “no mortgage of personal property is valid against any other person than the parties thereto unless possession of such property is delivered to and retained by the mortgagee or the mortgage is recorded,” there was no such delivery and retention of possession as to validate either mortgage, but that both were fraudulent as

attempted secret liens, and void as against the bankrupt's trustee. 2. BANKRUPTCY-FRAUDULENT TRANSFERS—RIGHTS OF TRUSTEE-EFFECT OF

ESTOPPEL OF BANKRUPT.

The estoppel of a bankrupt to deny the validity of a lien on his property does not affect his trustee, where such lien was voidable by his creditors.

In Bankruptcy. On review of decision of referee. Charles K. Cobb, for the National Exchange Bank of Boston, Mass. Joseph W. Lund, for Jos. W. Lund, trustee of W. S. Keene Leather Co. of Boston, Mass.

Powers & Archibald, for George A. Gorham and Willis I. Shaw.

HALE, District Judge. This case comes before the court upon the report of Edwin L. Vail, Esq., one of our referees in bankruptcy. The report is as follows:

"I, Edwin L. Vail, the referee in bankruptcy in charge of this proceeding. do hereby certify that in the course of such proceeding an order, a copy of which was annexed to the petition hereinafter referred to, was made and entered on the 30th day of August 1905; that Joseph W. Lund, as trustee in bankruptcy of the W. S. Keene Leather Co., a party in interest, feeling aggrieved thereat, filed a petition for review, which was granted; that the National Exchange Bank of Boston, a party in interest, feeling aggrieved thereat, also filed a petition for review, which was granted; that a summary of the evidence upon which said order was based, together with a review of the case, as follows: This is a controversy over the title to 1,814.27 cords

146 F.-18

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