Henderson v. J. B. Brown Co.
Henderson v. J. B. Brown Co.
Opinion of the Court
The bill in this case was filed by J. B. Brown Company, a corporation under the laws of Maryland, in behalf of itself and all other creditors of McKenzie who may come in and share in the expense of the litigation, against the respondents Henderson and McKenzie, for the purpose of having a certain attachment proceeding instituted bjr Henderson against McKenzie declared fraudulent and void. The averments of the -bill show that the complainant was an existing creditor at and prior to the suing out of the attachment. It is averred in the bill that for several years prior to the 25th day of November, 1896, McKenzie had been engaged in the
We have set out the averments of the bill with particularity for the purpose of pointing out the turn theories upon which the complainant predicates its right to the relief sought. The first theory is based upon the
The other theory proceeds upon the proposition that the alleged debt of Henderson, which he was attempting to enforce by his attachment against- McKenzie was simulated. If it be true as averred in the bill that it was simulated to the extent of ten thousand dollars, we are unable to see upon what principle the attachment can be upheld as a valid conveyance to Henderson of the property levied upon under it. The debt for which the attachment writ was sued out to enforce must be a bona fide one to- support the -attachment as against existing creditors as much so as the consideration must be bona fiele to support the validity of an instrument made by a debtor conveying his property. The result, so far as the party receiving the benefit of the transaction and the creditors of the insolvent debtor are concerned, is the same. The plaintiff in attachment, if it is allowed to stand, is the beneficiary to the extent of receiving the money, proceeds, arising from a sale of the property levied upon to the exclusion of the creditors; while the grantee named in the conveyance, if it is held valid, is the beneficiary of the property itself.
The statute makes no distinction between the two classes of cases. This is made manifest by the reading of it which is in this language: “All conveyances or
So then we may eliminate from consideration the first theory upon 'which the complainant predicates its right ■to relief and confine our discussion of the case, as made by the pleadings, to the complainant’s right to have the attachment suit declared fraudulent and void. For it cannot be said with any show of reason that there was error in the rendition of the decree granting the relief sought if it can be sustained upon this phase of the case.
A number of grounds of demurrer were assigned to the bill. The second and third grounds were cured by an amendment. The fourth in effect goes to the ownership by the complainant of the note, the foundation of the suit. Its ownership can only be denied by sworn plea. — Code, § 1801; Smith v. Hiles-Carver Co., 107 Ala. 272.
The bill does not show a doing of business in this State by the complainant such as to require it to file a statement designating a known place of business and an authorized agent within this State. Indeed it might be said that it does not show the doing of any business in this State at all.. The first ground of demurrer is, therefore, without merit.
The sixth ground raises the objection that the bill fails to aver that no ground provided by the statute for the issuance of the attachment existed at the time of the suing out of it by Henderson. It is of no consequence, whether any ground for the suing out of the attachment existed or not, if the debt for which if was sued out to enforce was simulated. If there had existed every ground provided by the statute for the issuance of the attachment, Henderson would have been guilty of a
What we have just said disposes of the fifth and last ground of demurrer. This brings us to a consideration of the answers filed by respondent Henderson to the bill. We will only advert to those portions of each Which bear upon the phase of the case under consideration. Henderson denies that he knew of the insolvency of McKenzie and further sayis “lie was of the impression and is so now, that he was solvent during the time from the commencement of his (present) business to its close.” He admits the suing out of the attachment for $17,046.72 and its levy upon goods of the value of $12,000. All that is averred by him in his original answer upon the subject of his debts against McKenzie is in the f ollowing language : “All of the debts that this defendant took out his 'attachment upon are genuine and bona fide.” In his amended answer he avers “that the debts upon which said attachment was sued out were for money and exchange loaned by this respondent to said J. C. McKenzie on or about the dates set forth in the notes described in the attachment proceedings and the complaint filed therein, and for the amounts expressed in said notes less interest, except one note for $5,000 which was for the indemnity of a certain acceptance made by the defendant to the Farley National Bank for said amount, all of which debts were genuine and bona fide at the time said attachment was issued and levied.”
The evidence shows that the complainant was a creditor of McKenzie prior to the suing out of the attachment by Henderson, and the proof is abundant that McKenzie was insolvent when it was sued out. Indeed he does not deny it in his answer, and Henderson’s answer can
Pretermitting all inquiry as to the sufficiency of the answers of Henderson in affirming the facts relied upon as constituting the consideration of the notes which he alleges were the foundation of the attachment suit, it is very certain that the burden of proof was upon him to clearly and fully prove that McKenzie was indebted to him in the amounts expressed in said notes. In other words, he must overcome by full and clear proof, the presumption of unfairness and mala fides. — Wood v. Pebbles, 121 Ala. 100, and authorities therein cited; Halsey v. Connell Greene & Co., 111 Ala. 221.
Henderson relies exclusively upon his own testimony to substantiate the bona fides of the various transactions by which McKenzie became his debtor as shown by the notes executed -bv McKenzie to him. It appears from his testimony, that the $17,046.72 which he claims was due to him, was made up of various items. $5,000 of this sum was evidenced by a note given by McKenzie to him as an indemnity for his acceptance in that amount to the Farley National Bank. $8,500 he says was borrowed by him at various times from the Farmers’ Bank at Troy, Alabama, and loaned by him to McKenzie. The remainder 'was his own money directly loaned by him. He kept no record of the time he made these various loans to McKenzie; he is uncertain as to the place where he made some of them. He is indefinite in his statements as to whether he gave McKenzie a New York check or the cash in making some of the loans to him. He does not know what amount of the $12,000 was furnished by him to McKenzie in cash and what amount in New York exchange: He admits to have had correspondence with McKenzie in the negotiation of
It appears from the record that quite a number of creditors accepted the invitation extended to them in the bill by filing their petitions to be made parties to the cause for the purpose of collecting their debts. The point is made that unless all the complainants can recover none can. This rule of law has no application to this class of cases. It can be invoked where all the complainants assert a joint right or title in the same cause of action. — Doherty v. Holliday, 137 Ind. 285; Long v. Bank, 85 N. C. 354; Taber v. Royal Ins. Co., 124 Ala. 681; Hill Bros. v. Moone, 104 Ala. 235; Steiner & Lobman v. Parker, 108 Ala. 357.
Appellant complains that the chancellor in the decree required Mm to pay into coux^t the amount of money received by him froxn the proceeds of the goods under his attachment proceedings within a specified time, and in default thereof an exeexxtion was directed to issue against him. His complaint is based upon the proposition that the complainant’s debt is small — less than ,$100 — and that the amount received by him was about $12,000. The utter fallacy of this contention is shown -when we call to mind that this is a general ox’editox’’s bill and that the respondent, appellant, as to the money in his hands, is a trustee for all the creditor’s of McKenzie. The chancellor recognizing this and for the purpose of administering the trust fund and distributing it to whom it properly (belonged, provided in the decx’ee, for the taking and stat
There is no error in the record, and the decree is affirmed.
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