Baker v. Baer

Wood, J., i. Asto withholding Is^ment (after stating the facts.) 1. Neither the . . deed of assignment, nor the claim of exemptions thereto attached, justifies the conclusion that there was a withholding of any real estate by the assignor. The granting clause of the deed is all-embracing as to the earthly possessions of the assignor, “except what are exempt to him by the laws of the State of Arkansas.” The lands conveyed were specifically described in the deed and schedule, and the land claimed by the assignor as' a homestead was included. The law, upon the evidence of the assignor, determines that the lands claimed as a homestead were never so impressed, and therefore are not exempt. Hence the title passed absolutely to the assignee. The language of the granting clause is unambiguous, and should be held to mean what it says. Only property “exempt” was reserved. This property was not exempt. Therefore, this property was not reserved. Nothing could be plainer. . This is not a case of conveying all in the deed, and at the same time secretly or intentionally withholding a portion for the debtor’s benefit. All was conveyed by the definite description, and this, so far as the deed itself, and the claim of exemptions thereto attached, is concerned, argues most strongly the good faith and honesty of the transaction. But if the land claimed as a homestead was in fact reserved, it would not follow that there was an intentional withholding of valuable assets to defraud creditors. Appellee contends that Gnthrie knew, or should have known, that the land claimed was not exempt. Suppose he did. If withheld, it was not exempt from the claims of creditors ; and, this being so, the assignor could hardly have adopted a more effectual method of inviting anxious creditors to subject it to their demands. It was “conspicuously pointed out” to creditors in the deed, and is a cogent reason for saying there was no fraudulent withholding. A reservation of the kind mentioned would not invalidate the assignment. German Bank v. Peterson, 35 N. W. 47; Ingraham v. Griggs 13 S. & M. 22; Carpenter v. Underwood, 19 N. Y. 520; Baldwin v. Peet, 22 Tex. 709; Heckman v. Messinger, 49 Pa. St. 465; Knight v. Waterman, 36 id. 258; Goll v. Hubbell, 61 Wis. 293; First Nat. Bank v. Hackett, id. 335; Dodd v. Hills, 21 Kas. 707. The seventh instruction, therefore, which told the jury “that the land claimed by Guthrie as a homestead should not have been reserved from the assignment, and such a reservation would render the assignment fraudulent and void,” was erroneous and prejudicial. This disposes also of the eighth. % Effect of subsequent 2. The third and ninth were likewise erroneous, . # abstract and misleading*. There was no proof whatever that the assignee took possession of any of the property assigned before filing his inventory and bond. The only proof upon the subject is to the contrary. The assignee testified that he did not take possession of any of the property until after he had filed his bond and inventory. He brought replevin for some mortgaged property, but did it because he apprehended the mortgagor was about to make way with it. Never got possession of it. He assisted the assignor, at his request, in making his inventory attached to the deed, and copied from it. Knowing that said inventory was correct, he advertised the property for sale after he had filed his bond, and while he was making the inventory. The assignor testified that the assignee made and filed his bond as such assignee, and was making his inventory, when, before it was completed, and before assignee had received possession of the property, the attachments were levied. Instructions, therefore, assuming that the assignee might have committed a fraud in taking charge of the property or executing the trust were abstract and prejudicial. They were likewise erroneous in assuming that any conduct of the assignee subsequent to the execution of the deed of assignment would render it void. Hempstead v. Johnson, 18 Ark. 124; Cornish v. Dews, id. 172; Lowenstein v. Finney, 54 Ark. 124; Excelsior Mfg. Co. v. Owens, 58 Ark. 556; Burrill on Assignments, sec. 320, p. 440. Of course the requirements of the statute must be pursued where parties make and undertake to carry out an assignment under it. And, as has been held by this court, the assignor must not deliver, nor the assignee take possession of, the assigned property in pursuance of a contemporaneous agreement, whether parol or expressed in the deed, before inventory and bond are filed. Such conduct will vitiate the assignment. Smith v. Patterson, 57 Ark. 537; Gilkeson-Sloss Com. Co. v. London, 53 Ark. 88. 3. Evidence tabHshpart" 3. The court in the sixth instruction for appellee told the j ury ‘ ‘ that if the property assigned belonged to a partnership of which Guthrie was a member, he would have no power to assign it, and their verdict should be against the interpleader.” . In addition to the facts already appearing in the statement as to the partnership, a letter of Baer, Seasongood & Co., dated September 21, 1891, to S. G. Guthrie & Co., asking of said company a statement of its. business affairs, was introduced; also the statement made in response to said letter. After setting out the various items, in answer to the questions propounded, the statement concludes as follows : “The above statement, both printed and written, has been carefully read by us, and is a full and correct exhibit of our financial condition, which we make for the purpose of obtaining credit from Baer, Seasongood & Co., St. Gouis, Mo., for merchandise which we may now or hereafter purchase from them. (Signed) S. G. Guthrie & Co., by Guthrie, a member of the firm.” S. G. Guthrie testified as to the partnership as follows: “ About February, 1891, I offered to take in as partners J. W. and W. G. Hastings, if they would put in three or four thousand dollars. They assented, provided I could use their promissory notes for that amount with my merchants; but, not being able to use them, I returned the notes to them in four or five days after I received them. It was still agreed that they should become my partners the next fall by putting in ■ the amount agreed on, and that in the meantime I should use their names. I did so until about the 10th of October, 1891, when they told me they could not raise the money, •and could not become my partners, and requested me to use their names no more. They were never in fact my partners. They never contributed a cent of capital, never received or claimed any interest in the business, and never took anything from it. They were my customers, and I kept accounts against them as against my ■other customers, and collected them in the same way.” It is unnecessary for us to discuss the question as to whether a partner has the right to make assignment of all the partnership assets to a trustee for the benefit of creditors with preferences, in his individual name and without the assent of his copartners. It may be conceded, and has been decided by this court, that such a thing cannot be done; that “ an assignment of all the effects of the partnership, including the means necessary for carrying it on, is not within the scope of a partner’s implied powers.” Drake v. Thyng, 37 Ark. 228. The appellee assumes that there was a partnership. There is no proof of one. The fact that appellees sued S. L. Guthrie, J. W. and G. W. Hastings, and obtained judgment against them under the firm name of S. L. Guthrie & Co., and that the attachment was issued and levied upon the property in controversy as the property -of the firm, did not establish the fact that the partnership existed, or that the property levied upon was its property. The record does not show that such an issue was raised in the action for debt. It is not shown that either of the Hastingses filed an answer. Whether the judgment was obtained against them by default, or otherwise, does not appear. They are not here complaining. The testimony of S. L. Guthrie, uncontradicted, ■shows that they had no interest whatever in his business, did not contribute to the capital of the business, and never received anything from it. He explains how their names were used, and that, after the 10th of October, 1891, he, at their request, and upon their failure to-comply with the conditions upon which they were to form a partnership, ceased to use their names any more. So-that, if the partnership ever existed, the proof is that it had ceased long before this assignment was made. The most that could be claimed upon the proof on the partnership question is that it was a mere holding out—not an actual partnership inter sese—and, such being the case, there was nothing to inhibit Guthrie from making-the assignment. He was the real owner of the business. 17 A. & E. Ene. p. 1046, U.; Whitworth v. Patterson, 6 Lea, 119; First Nat. Bank v. Hackett, 61 Wis. 335. 4. The statement signed “ S. L. Guthrie & Co., by S. E. Guthrie, a member of the firm, ’ ’ was admissible. It was a statement, as the proof shows, of Guthrie’s assets-but a few months prior to the assignment, and was made out by Guthrie himself, though in the firm name, as a. basis of credit. It tended to’ show the existence of a. partnership at the time it was made.; and, as what is-once shown to exist is presumed to continue until the contrary appears, it was admissible to go to the jury for the purpose of showing a partnership, and was subject to any explanations that could be made of it. The man who made it fully explained it. 1 Greenleaf, Ev. 41. It is not necessary to discuss the propositions of law presented by appellant and refused. For the error indicated the judgment is reversed, and cause remanded.