Hart Bros. v. Dogge

Maxwell, J. The plaintiffs recovered certain judgments against one C. G. Herold, and executions having been issued thereon were returned unsatisfied. An action in the nature of a creditor’s bill was thereupon brought against the defendants, and on the trial findings and a decree were rendered as follows: “The court finds for the plaintiffs generally, and that the allegations of said petition are true, and that the said Hart Bros., at the January, 1885, term of the said county court, recovered said three judgments against said defendant, Christian G. Herold, in the sum of one thousand five 'hundred fifty-three and dollars debt, and $15.20 costs of suit. “That at the time of and prior to the commencement of this action the said Christian G. Herold was and is wholly insolvent and unable to pay his debts, and that on or about the 1st day of November, A. D. 1884, the said defendants, and all of them, entered into a confederation and conspiracy to cheat, swindle, and defraud all of said plaintiffs and creditors of the said Herold, and for that purpose and for no other consideration said Herold commenced to pay over and did pay over to the said Otto H. Dogge large sums of money and property, amounting in all to upwards of fifteen thousand dollars, which money having been kept by said Otto II. Dogge and Bertha Dogge, his wife, until the 30th day of March, 1886, said Otto H. Dogge and Bertha Dogge did on said day purchase with said money from one Alfred Irwin the property in dispute in this action, described as that part of subdivision fifty-four (54) of S. W. Tittle’s subdivision of the west half of the southwest quarter of section twenty-four, in township No. ten (10) north, of range six (6) east, of the sixth (6) principal meridian, in — 258 — Lancaster county, Nebraska, and more particularly described as follows: Beginning at the southwest corner of said subdivision fifty-four, thence east on the north line of P street in said city one hundred (100) feet, thence north and parallel with the east line of Grand avenue one hundred and forty-two (142) feet, thence west one hundred, (100) feet to said Grand avenue, thence south and along, the east side of said Grand avenue one hundred and forty-two, (142) feet to place of beginning, and took said conveyance in the name of Bertha Dogge, wife of said Otto H. Dogge, for the purpose of hindering, delaying, defrauding, and cheating the said plaintiffs, said money being paid to said Irwin out of the moneys given to said Bertha Dogge and Otto H. Dogge as aforesaid, and which property is now occupied by said parties and claimed as their homestead. “The court further finds that the said deed of date March 30, 1886, of Alfred Irwin and wife to the said Bertha Dogge, conveying to her the said premises as set forth in the petition, was made with the intent to hinder, delay, cheat, and defraud the plaintiffs, the creditors of the said Christian G. Herold, all of which the said Bertha Dogge and Otto H. Dogge had full knowledge at the time of receiving the same, and that the payment made to the said Irwin was made out of the money received by said Bertha Dogge and Otto H. Dogge from the said Christian G. Herold. “ It is therefore considered by the court that the deed described in the said petition, from Alfred Irwin and wife to the said Bertha Dogge, from the premises above described, and the same is hereby adjudged and decreed and declared to be held in trust by the said Bertha Dogge for all of said plaintiffs and that said property may be subjected to the payment of the debts set forth in the petition, and that the sheriff of Lancaster county is directed to proceed as upon execution to sell said property and pay the proceeds thereof over to said plaintiffs as herein decreed, and — 259 — that the defendants pay the costs of this action taxed at $415.10.” The testimony tends to show that about the year 1882 Ur. Dogge removed to Plattsmouth, in this state, and opened a small drug store and remained at that place about a year, when he removed to Lincoln; that while residing at Plattsmouth he became very intimate with C. G. Herold, a merchant there; that after Dogge removed to Lincoln he urged Herold also to remove to Lincoln; that principally through his efforts Herold did remove to Lincoln in J 883 and opened two stores there; that during 1884, and prior to December 25th of that year, Herold had contracted debts for goods to a very large amount, estimated by some of the witnesses at $45,000, and Herold himself at about $38,000; that there was an attempt on the part of Herold at least to place a considerable portion of his goods beyond the reach of his creditors; that during all this time Dogge was the confidential friend of Herold, and professed to be able to effect a compromise of his debts at twenty-five cents on the dollar. To accomplish this purpose, Herold about the 25th of December, 1884, gave Dogge $9,600, and he already owed Herold $400, and had previously received considerable sums. Dogge thereupon went to Chicago, when he wrote to Mrs. Herold a letter in German, which is translated in the record as follows: “Chicago, February 22nd, 1885. “Very Honored Mrs. Herold: I arrived at Dixon and here at Chicago safe, but I couldn’t do anything for Mrs. Robertson and her children, as they asked $2,000 for the lot and don’t know yet if she sells, so I have concluded to let the lot matter go as long as I can. As I meet here a few good old friends which are going to New Orleans, and they persuaded me into going along; so I have concluded, as I feel so very bad now, to go along with them, but I shall only stay a short time, and from there at once to New Mexico, and on this trip to contemplate what is — 260 — necessary for you and I. Now, as to how I feel; now I cannot exist, as I am getting worse and I want rest. I also pray to you not to trouble yourself, and in no way be afraid to be before the court, as you are innocent of everything and don’t know nothing, and Charlie neither; now you will stay on this truth that your husband never explained anything to you about his business, and you never asked him anything about it, and you always signed the papers that your husband laid before you, and that money what you received from Shafer with that will your husband commence business and the money your husband had taken along to New Mexico. “If you stay by this truth then you can have no trouble, and don’t let the words be changed. I would like to be there from the wish of my heart, as long as the court is in session, but am feeling so bad that I am afraid I’ll get worse sick, and then I couldn’t stay by you at all, and then we must not often be together as long as the court is in session, as they might make me a big trouble, which I didn’t deserve, especially if they found out that your husband is gone. I shall hunt up Mr. Herold and shall guide everything for your best and come back when the court is over. Now I pray to you, again, honored Mrs. Herold, don’t trouble yourself; everything will go better than you think. Dear Charlie, stay by your dear mamma and try and make it easy for and gladly humor her, and hope that when I come again to meet you all well and not forsaken. I will hunt up the Jew in St. Louis if I find him so as to get that money. I pray to you me to answer immediately to New Orleans. I will call at the post for the letter. “Heartiest regards an all to all. “I remain your friend, “O. H. Dogge.” There is testimony in the record tending to show that he had promised to purchase a certain lot for Mrs. Herold and also that he promised that he would meet Mr. Herold — 261 — in New Mexico when they would engage in business there; that in pursuance of this arrangement Herold went to Las Vegas, N. M., and stayed there a long time, expecting Dogge on every train. Dogge seems to have failed to compromise the debts, or any of them, if indeed he made any effort to do so, and soon after went to Europe, wdiere his wife and children had preceded him; that Dr. Dogge received a large amount of funds belonging to Herold for which he gave no consideration is proved beyond question, and as against creditors of Herold he is a trustee for the amount so held. But it is said that the property in question was purchased with the money of the wife, and therefore she is not chargeable. It does appear that from 1872 to about the year 1876 or 1877, while the doctor resided in Wisconsin, she was possessed of some money and loaned the same; but the testimony also shows that she was quite a traveler and there is but little tangible proof of her possessing means after that time except as hereinafter stated. On the other hand, Dr. J. Massman testifies that he was acquainted with Dr. and Bertha Dogge at Mayville, Wis., in 1880 or 1881; that he had several conversations with Bertha Dogge, who stated “that she had hardly any money at all; ” that if they could sell their house, on which there was a mortgage, they could get together perhaps $600 or $800. Dr. Schoen, of the same place, testifies that the house in question was sold for about $400; that when Dr. Dogge came to Mayville in 1879 his wife was in Europe; that upon her arrival in New York she telegraphed to her husband for money to pay her expenses to Wisconsin and that thereupon Dr. Schoen telegraphed his correspondent in New York to pay her $25.00, which was done. He also testifies that after the return of Mrs. Dogge he had several conversations with the doctor and his wife, and that he knew from conversations with both of them “that they were — 262 — as poor as a church mouse.” These gentlemen are disinterested witnesses and apparently friends of the family and familiar with their circumstances, -and their testimony apparently is perfectly reliable. A number of witnesses in this state who were acquainted with the Dogges after their removal here were called as witnesses. M. A. Hartigan testifies that Mrs. Dogge stated to him and Mrs. C. G. Herold, in the city of Lincoln, shortly before the bringing of this action that “ she must get all she could out of them (the Herolds), because what she got out of them was all she had in the world.” In this he is corroborated by Mrs. C. G. Herold. Mrs. Herman Herold testifies that while Dr. Dogge and his wife lived at Plattsmouth she had a conversation with Mrs. Dogge in which she stated “ that she had such a hard time of it,” in the way that she had to get along financially. Lena Halen testifies that about the year 1884 she had frequent conversations with Mrs. Dogge about her financial condition, and that “ she talked as though she did not have very much.” William Morris testiíiés that after the trial and acquittal of Dr. Dogge, on the criminal charge, he was standing on Eleventh street, nearly opposite the cigar store between N and O streets, and' Dr. Dogge and some gentlemen were standing talking, and Mrs. Dogge rode up in a buggy. They shook hands, he helped her out of the buggy, and said, “Mr. Herold has gone up (he was convicted), we have got his money and don’t care where he goes.” Judge S. W. Lamoreaux, of Mayville, Wisconsin, testifies that he had resided in Mayville thirty-five years, and was county judge of Dodge county, Wisconsin; that he was acquainted with Dr. Dogge and wife; that before Dr. Dogge left Mayville he had a conversation with him “ in reference to his business affairs. From the conversation I had with him and my knowledge of his affairs, I would — 263 — judge he had about from $500 to $800, which did include his house and lot. I did know Mrs. Bertha Dogge, his wife. To my knowledge his wife, Bertha, had no property. She came to me for assistance, stating that she wanted some money till she heard from her husband. My recollection is the doctor was gone. It was after the doctor ceased business here.” There is a large amount of testimony to the same effect, which if referred to would extend this opinion to too great length, but at every place where the doctor resided — at Milwaukee, Eond du Lac, Mayville, Marshville, and Plattsmouth — he seems to have been in straitened circumstances. Reliable, trustworthy, disinterested witnesses considered them poor, and it was not until they met Herold that they began to exhibit signs of wealth. Acts speak more potently than words, and circumstances are more reliable than mere assertions. All the outward indications were that these people were poor when they moved to this state. The doctor has changed his residence too often to build up a lucrative business at any place where he has resided since coming to this country in 1872. It is true that there is in evidence what purports to be a book of original entries of "his business from June 27,1884, to February 17,1885, in which the charges amount to a very large sum. This book is remarkable for the uniformity of the entries, in color of the ink, style of writing, and general appearance, as though written up within a few days. That the same kind of ink should have been used during a period of nine months is not out of the ordinary course, and that the entries should be made with the same pen where a non-corroding one is used, but that there should be no change in the penmanship, through all the climatic .conditions affecting the human frame, is remarkable. The doctor, however, testifies on cross-examination that the entries were made as they occurred, with different pens of the same kind — steel pens, apparently. Mrs. Dogge and several witnesses tes — 264 — tify that she had about $7,000, in cash, when she came to Lincoln. This money was kept in no bank or other reliable depository, nor in any place where the fact of its existence could be established, but the proof depends alone upon assertions, which are strongly disproved by circumstances. There is a direct conflict in the testimony of the witnesses in this case, and it is evident that some of them have deliberately sworn to what is untrue. The trial court having passed upon the weight to be given to the testimony of the several witnesses, most of whom testified before it, this court cannot reverse its judgment unless it appears to be clearly wrong, which is not the case. This court will, as far as consistent with good faith to creditors of her husband, or creditors who have been defrauded by him, protect the rights of the wife in the enjoyment of her separate estate; but in order to do this it must be proved that there was a separate estate belonging to her which was seized for the debts of another. In this case, however, there is too much doubt about the separate estate of the wife to entitle her to relief. It is fully shown that a large amount of Herold’s property passed into their (the Dogges,) hands and that no consideration was paid for the same, and that the creditors of Herold were thereby prevented from’ recovering their just dues. That the property in dispute was derived from the proceeds of the Herold property transferred to the Dogges is clearly apparent, and it should be applied to the payment of such creditors. The judgment therefore in that regard should be affirmed. The property, however, is shown to be of much greater value than $8,500, there having been a considerable increase in value since the purchase. This increase in speculative value the creditors of Herold are not entitled to. In other words, they are entitled to the amount invested with legal interest thereon, and not to money made by speculation in excess of the legal interest. The judgment of the district court will, therefore, be — 265 — modified to subject the property to the amount of $5,000, with interest thereon at seven per cent per annum. Judgment accordingly. Cobb, J., concurs.