McGray v. Woodbury

Hanson, J. This is an action of assumpsit for goods sold and delivered, and comes to this court on plaintiff’s exceptions to the ruling of the presiding Justice ordering a nonsuit. The plaintiff was a grocer in East Knox, and occupied a store belonging to the defendant under a lease for five years. The lease was still in force. The defendant held a mortgage on the goods in the store for $200. There was a second mortgage for $50. The stock inventoried $775-79, plaintiff’s debts amounted to $1161.81, and he had no other property. In January, 1912, the plaintiff entered into an agreement with Walter Woodbury, a brother of the defendant, to sell to said Woodbury the stock of goods at cost, and a bonus of $60. The plaintiff delivered the key to the store and the unexpired lease to the defendant. An account of stock was taken, and the amount being larger than the buyer anticipated, he expressed doubt as to his ability to pay. Thereupon the defendant offered to take “the stock off his hands.” The plaintiff claimed that this offer was accepted and agreed to by him. The defendant says the offer was not accepted. Walter Woodbury went to Belfast the same day, and the next morning the plaintiff and defendant rode to Belfast together. On the way they met Walter Woodbury returning. There was a conference in which the defendant asked his brother “if he had made up his mind about the goods,” and he testified: “I told him I had made up my mind to turn them over to him. He said he would take them off my hands and Mr. McGray said he was perfectly willing.” The plaintiff and his witness are not in agreement as to this, the plaintiff claiming a sale to defendant at the store the day before. On reaching Belfast, the plaintiff and defendant ascertained for the first time that it was necessary to notify the creditors of the [165] plaintiff, as provided in chapter 114 of the Public Paws of 1905. Advice of counsel was had and! proper steps taken to make a valid sale. A list of creditors was then and there made and sworn to by the plaintiff and furnished to the defendant, and there was full understanding and agreement between the parties as to their further duty, one to the other. The 'largest creditor of the plaintiff was represented at the meeting in Belfast. In reference to this branch of the case the plaintiff was asked: “Q. Was it understood when that (the list of creditors) was made, that Mr. Woodbury would notify or send the list and notices to the -creditors? A. That was the way I understood it. Q. You understood that h-e was not to pay f-o-r the -goods until that had been done according to the statute, didn’t you ? A. Why, yes; yes. Q. He refused to pay anything that morning? A. Yes.” Whatever occurred -at the meeting on the way to- Belfast, or the day before at the store, was modified by mutual -consent -on reaching Belfast, both parties seeing -the necessity of beginning over, and proceeding according to law. They undertook to comply w-ith the law, .but creditors, exercising th-eir rights, attached the -goods within five days from the date o-f the meeting at Belfast. Under such circumstances there could he no- sale to- the defendant. That the plaintiff so- concluded appears from his testimony. He says that, after the meeting at Belfast, and on leaving the -office of Dunton and Morse, the defendant advis-ed him “to go into- bankruptcy,” and that -on 'his return to East Knox “he demanded the return of the lease and -the key of -the store from the defendant.” The plaintiff urges that Chapter 114, of the Pub-li-c paws of 1905, which requires full information to- be given -to. -creditors, together with notice of such sale, is unconstitutional, “in that it deprives persons of their rights, privileges and liberty to- control their -property,” and thus violates Section 6 of Art 1 of the Constitution of Maine. We are of -the -opinion that the objection stated is insufficient to justify the conclusion that -the act is unconstitutional. In J. P. Squire Co. v. Tellier, 185 Mass., 18, in which a similar statute was under consideration, the -court -say: “that the purpose of the Pegislature evidently was ■ to- provide -creditors protection against a class -o-f sales which are frequently fraudulent and which leave creditors with -no means o-f collecting that which they ought to [166] receive. The statute deal's only with sales in bulk of a .part, or the whole of a stock of merchandise, Which are not made in the ordinary course of trade, and in the regular and usual' prosecution .of the sellers’ business. It does not 'interfere -with the transaction of ordinary business., but relates to unusual and extraordinary,transfers. In substance it declares that a sale of this kind -shall not be. made without first giving creditors an opportunity to collect their debts -so far as the property to be sold might enable them to collect, or subsequently make -satisfactory provision for the payment of these debts-. . . . That this is within a-class -of legislation for which- there is constitutional authority is- too plain for question. The -statute requires of the vendor nothing that cannot be done with reasonable effort. If ihe is unable or unwilling to pay his debts, it puts a substantial obstacle in 'his way when -he wants to dispose of 'his stock of merchandise in bulk and receive payment for himself. But .under -such icircumst-ances, -the property in most cases ought not to be sold in bulk without first 'giving creditors an opportunity to consider what -ought to be done with it.” Lemieux v. Young, 211 U. S., 489. The nonsuit was properly ordered, and the entry will be, Exceptions overruled.