Cohen v. Calhoun

*38 Anderson, J., delivered the opinion of the court. Appellee brought this action against the appellant in the county court of Hinds county to recover the sum of three hundred dollars. There was a trial resulting in a judgment in favor of appellee. From that judgment appellant appealed to the circuit court of Hinds county, where the judgment was affirmed, and from that judgment appellant prosecutes this appeal. There is involved a construction of the bulk sales statute, section 3353,, Code of 1930. B. J. Miller was a retail merchant in the city of Jackson. He was duly adjudged a bankrupt, and appellee was appointed trustee to administer the estate under the federal bankruptcy laws. Prior to the adjudication of bankruptcy Miller sold to appellant one hundred and fifty ladies’ dresses in bulk, for which appellant paid him the sum of three hundred dollars. At the time of the sale Miller was insolvent. Both the seller and appellant failed to comply with paragraphs (a), (b), and (c) or the bulk sales statute. That statute in this language : “ A sale of any portion of a stock of merchandise, otherwise than in the ordinary course of trade, or in the regular and usual prosecution of the seller’s business, and a sale of an entire stock of merchandise in gross, shall be presumed to be fraudulent and void as against the creditors of the seller, unless, at least five days before the sale: “(a) The seller shall have made a full and detailed *39 inventory, showing the quantity, and, so far as can be done by the exercise of reasonable diligence, the cost price to him of each article sold; and “(b) The purchaser shall have in good faith made full and explicit demand of the seller for the pame, place of residence and business and post-office address of each of his creditors, and the sum due each, and to which demand the seller shall have made full and truthful written answers; and “(c) The purchaser shall have in good faith notified personally or by mail each of the seller’s creditors, of whom he has knowledge, or with the exercise of reasonable dilligence could have acquired knowledge, of the proposed sale and of the cost price of the merchandise proposed to be sold and of the price to be paid therefor .by the proposed purchaser.” To appellee’s declaration, appellant pleaded the general issue and a special plea, which set up, in substance, that such sales in bulk were customary among the retail merchants of the city of Jackson. The evidence for appellant tended to establish the pleas. Miller, the bankrupt, testified, in substance, as follows: That he was discontinuing his business at his old store in the city of Jackson and-moving to a new store. That in the new store he intended to handle a better class of goods than he had handled in the old store. That the goods in the old store had become somewhat shopworn. That he sold appellant one hundred and fifty dresses at two dollars each, which were sold and delivered in bulk and paid for by appellant in one check. That in addition he sold goods from the store in bulk to L. Abrams and to Mrs. Sophia Lasnnsky. That he was at the time, and had been for some time theretofore, a retail merchant. That he sold at retail alone, and that these bulk sales were out of his usual course of business, and were made for the purpose of going out of his old place of business into a new store where he expected to carry a better stock. *40 It will be observed that the first paragraph of the bulk sales statute provides, among other things, that a sale of any part of a stock of merchandise “otherwise than in the ordinary course of trade, or in the regular and usual prosecution of the seller’s business,” shall be fraudulent and void, unless paragraphs (a), (b), and (c) of the statute are complied with. The case was tried by agreement of the parites before the county judge without a jury. In rendering judgment for appellee the court necessarily found that the sale by Miller to appellant was a sale otherwise than in the ordinary course of trade or the regular and usual prosecution of Miller’s business as a retail merchant, and the circuit court in affirming the judgment of the county court necessarily so found. We think the judgment is justified by both reason and authority. Freeman v. Collier Racket Co,, 100 Tex. 475, 101 S. W. 202 ; Keller v. Fowler Bros. & Cox, 148 Tenn. 571, 256 S. W. 879 ; Nisbet v. Quinn (C. C. Ga.), 7 Fed. 760 ; Goodman v. Clarkson, 39 Ga. App. 383, 147 S. E. 183 ; Rison v. Knapp, 20 Fed. Cas. 835, No. 11, 861. 1’f appellant is right in his contention, it means that any insolvent retail merchant could sell out his stock in bulk without complying with the last three paragraphs of the statute, provided he sold to more than one purchaser. In other words, he could divide his stock up into two portions and sell one lot to one purchaser and one to another; or he could divide it into as many lots as he saw fit and sell to as many different purchasers, and thereby defeat the plain policy of the statute. The statute cannot be destroyed by custom and usage. D. S. Pate Lumber Co. v. Weathers (Miss.), 146 So. 433. Suppose it was the custom and usage of merchants in a particular locality to sell their entire stock in bulk at one time to one purchaser without complying with the statute; certainly no one would contend that such a custom would obviate the necessity of complying with the *41 statute. Whenever the statute is violated custom and usage must stand aside. Affirmed.