Gennerich v. Voigt

We think, from the evidence, that the plaintiffs fairly sustained the burden placed upon them of showing that the bill of sale sought to be set aside was given to hinder, delay, and defraud creditors. As to the value of the property transferred, it will be noticed that the allegation of the complaint is that the property was worth upwards of $3,000, and this is not denied by the answers; so that, even if we conclude that the consideration of $1,500' named in the bill of sale was actually, advanced, it was an inadequate price for the property. The. defendants at the trial sought .to show—notwithstanding the express words of the bill of sale that John was to “pay all indebtedness” existing—that it was agreed when the transfer took place that William, after satisfying his claim, was to pay to the creditors what was due them from the assets remaining. Had such an agreement been contained in the bill of sale, it would, in efféct, have been a general assignment for the benefit of. creditors, and, not complying with the statute permitting such assignments, would have been void. Regarding the transaction not as a general assignment for the benefit of creditors, we may infer from the conduct of the parties that the plan adopted "was really one to permit J. H., Mohlman & Co. to obtain the amount due them, to the exclusion of other creditors, and reserve the balance for William Voigt in payment of alleged loans. •

• There is in evidence no memorandum or receipt or bank book of either of the defendants, which, if produced, would have been of great value in support of their claim that the loans were made. There is, besides, an inherent improbability in their statements. It seems improbable, when working for his brother, at such ,a small salary, that William would have available $450 to make the first loan claimed. Similarly, that John, after selling out his business-in 1896, when, in Ms own words, he “paid all his creditors,” should still be indebted to William,—especially at a time when William was still in debt for the new grocery store on 102d street, wMch he-had purchased partly on John’s credit; that he should go' abroad. with his family for three months, and return penniless, and at once obtain from William $400 with which to enter business again. It *623will be noticed that John’s credit was the better, for his name was signed to the notes which William was to pay. And it is significant that just before the transfer the account in the Yorkville Bank was closed, and the bank books unaccountably disappeared, although the record of deposits would indicate an even and prosperous business, with receipts averaging at least $1,100 for months prior to the time deposits ceased. We have, besides, the testimony of two witnesses, opposed to that of John Yoigt, that before the transfer he stated to one, in December, 1896, that he had no liabilities, and in. December, 1897, to the other, that his only indebtedness was to the plaintiffs and to J. H. Mohlman & Co. One of these witnesses is a reporter of a mercantile agency, having no direct interest involved, who had made previous visits to the store, but whom the defendant said he did not even recognize. The reporter’s testimony that the stock alone was worth about $2,000 is another proof that the consideration named in the bill of sale was inadequate. And that the sum stated of $1,500 was accurate, if any amount was due, is rendered doubtful by the plaintiffs’ testimony that William mentioned $1,000 as the total sum borrowed. Our conclusion that the plan was one to defraud creditors is founded not only on what had taken place prior to the making of the bill of sale, its terms, and the circumstances at the time it was given, but also by the subsequent conduct of the defendants. Within a short time we find John in possession of a store at ¡Ninetieth street, conducting it in the name of his brother, but alone familiar with its management, rendering no account whatever, and withdrawing from it such money as he pleased. We think that the only inference deducible from the evidence is that the giving of the bill of sale was a scheme to hinder, delay, and defraud creditors, and that it was error, for the court below to dismiss the complaint.

The judgment should therefore be reversed, and a new trial ordered, with costs to the appellants to abide the event. All concur.