Cuendet v. Lahmer

[529] The opinion of the court was delivered by Brewer, J.: This is a proceeding to review the action of the district court of Shawnee county in vacating an attachment. The principal ground in the affidavit for the attachment was the disposal of property with intent to hinder, delay, and defraud creditors. The truth of this was denied. Upon the affidavits presented there can be no reasonable doubts as to the correctness of the court’s ruling in so far as the question of an actual intent to hinder and delay creditors is concerned. While property was disposed of, the proceeds thereof were, with the exception of an inconsiderable sum, all used in the payment of debts. Of the $650 realized from the sale and mortgage, all that plaintiffs’ counsel claim is, “that at least fifteen dollars of the money thus realized does not appear to have reached defendant’s creditors.” The payment of the residue to creditors is clearly traced. There was therefore a preference, rather than a delay or a defrauding of creditors. Indeed, we scarcely think from the argument of the learned counsel for plaintiffs that , they expect this court to find from the testimony that there was an actual intent on the part of the defendant to delay or defraud creditors. It is fraud in law, rather thari fraud in fact, to which they point, and upon which they rest their case. “The effect of the chattel mortgage was to hinder and delay creditors. The law will conclusively presume that he intended the natural consequences of his act. Therefore he intended to hinder and delay his creditors, and this supports the attachment.” The proposition is too broad. The natural effect of an assignment for the benefit of creditors is hindrance and delay. Yet it is not therefore void, and the property subject to attachment. Case v. Ingersoll, 7 Kas. 367; Kayser v. Heavenrich, 5 Kas. 338. So that the mere fact that the tendency of the act is to work a hindrance or delay, is not absolutely decisive. The right of a debtor to prefer a creditor, and to appropriate a portion or all his property in good faith to the payment of a single debt, cannot be denied, unless there [530] be, as in the U. S. Bankrupt Act, some special statutory restrictions. So also, the right of a debtor for the same purpose, and in like good faith, to burden his property by mortgage, or to use it by pledge or otherwise in raising money, cannot be questioned. And these propositions are all that are necessary to dispose of this case. The property sold was sold at a fair valuation — the same valuation afterward placed upon it by the appraisers when taken on the attachment. It does not- appear that the mortgage was upon an unreasonably large amount of property, or was in any of its provisions out of the ordinary course of business, or unreasonably exacting or oppressive. And the proceeds of both sale and mortgage were appropriated as heretofore indicated. We see nothing to justify a reversal of the ruling of the district court, and it will be affirmed. All the Justices concurring.