Morse v. Ryland

1. Correct Instructions Misleading — in general scope, where propositions favorable to one party frequently repeated or unduly emphasized. Instructions should be framed so as to present the law applicable to the facts developed by the evidence introduced on each side. Unnecessary repetition of instructions favorable to either party, and unnecessary emphasis of any particular proposition of law, should be avoided. The court ought fairly to present the law applicable to the theories of both parties, so far as they are supported by any evidence. The general scope of the charge given in this case is criticized and held misleading. 2. Fraudulent Conveyance — evidence of fraud may be circumstantial. In an action of replevin to recover a stock of goods, held by the sheriff under attachment, which the plaintiff claims to have purchased from the person against whom the attachment was issued, where the defense of the sheriff is that the alleged purchase was fraudulent, it is error for the court to refuse to charge the jury that the defendant is not required to establish the fraud by direct and positive proof, but that it may be inferred from circumstances if sufficient to convince the jury of the fact of fraud. 3. --purchaser charged with knowledge of fact which diligent inqiry, suggested by the circumstances, would have revealed. It is also error to refuse to charge the jury that, in order to avoid the sale, if fraudulently made by the vendor, it is not necessary to prove, that the purchaser had positive knowledge of the fraud, but that, if circumstances sufficient to put a prudent man upon inquiry are shown to have been brought to the knowledge of the purchaser, he will be charged with knowledge of all such facts as a diligent inquiry would have disclosed.

Error from Sumner District Court. Hon. J. A. Burnette, Judge. In an action brought by Aultman, Miller & Co. against W. K. Ryland, a stock of hardware, kept in South Haven, Sumner County, was attached. M. L. Ryland brought suit against the Sheriff, the plaintiff in error, to recover the attached property, claiming to own it by purchase from his brother, W. K. Ryland. It was an undisputed fact that, on the first of July, 1893, W. K. Ryland owned the property in controversy and was in possession of it. The statement of the plaintiff with reference to the transfer of the property to him, is substantially as follows : About six o’clock on the evening of July 1, he went into the store of his brother, who called him back to the desk and said : “I have got something to tell you, and I hate awful bad to do it. I have gone’ as far as I can in my business, and I want to save you what I owe you.” His brother then proposed to sell him his stock of hardware ; and asked him how much the indebtedness amounted to. The plaintiff told him about twenty-three hundred dollars ; and it was thereupon agreed that the plaintiff would take the stock of goods in satisfaction of the debt, and that they would go to Wellington on the next Monday morning, July 3, and have a bill of sale executed for the stock. On Monday, between four and five o’clock in the morning, they started for Wellington. In the buggy, on the road to that place, they had á further conversation with reference to their affairs. W. K. Ryland owned one-half of a brick building occupied by the two brothers ; the plaintiff having a dry-goods store in the part kept by him, and W. K. using the other for a hardware store. W. K. owed two notes to the South Haven Bank ; one for five hundred dollars, signed by M. L. Ryland as surety, and the other for $640. It was agreed between them, while on the way to Wellington, that W. K. Ryland should deed his half interest in the store building to M. L. Ryland in consideration of his assuming and paying these two notes. It wae also agreed that the plaintiff should pay a lumber bill of $16.50 to Tom Hill, as a part of the consideration for the stock of goods. When the brothers arrived at Wellington they called on George Pitts, before he was up, to draw papers for them. He went to his office and drew a bill of sale from W. K. to M. L. Ryland for the stock of hardware; a deed to M. L. for W. K.’s interest in the store-building ; a deed from W. K. to his wife for their homestead in South Haven, and a deed to Wesley Nave for a house and lot in South Haven. All these papers were executed and acknowledged by W. K. Ryland and delivered to M. L. Ryland, who afterwards procured the signature of W. K. Ryland’s wife to the deeds and caused them to be recorded. These instruments purported to transfer all the property owned by W. K. Ryland, except book accounts and notes, amounting to something more than twelve hundred dollars. Two brothers, Elmer and Charles Slocum, had been employed by'W. K. Ryland as clerks, and traveling salesmen for agricultural implements and binding twine. According to the testimony, W. K. Ryland was indebted to them to the amount of about seven hundred dollars fcr wages and borrowed money. On Saturday, July 1, he authorized them to draw off accounts from Ms books, collect them, and take their pay out of what they collected. The books containing the accounts appear to have been taken to W. K. Ryland's house, and representatives of his creditors were refused by M. L. Ryland and Mrs. W. K. Ryland any information concerning the books or where they could be found. After the papers were executed, on the morning of July 3, W. K. Ryland took a train leaving Wellington at about eight o'clock and went to Iowa. He was furnished thirteen dollars for that purpose by M. L. Ryland on that morning. He remained there two or three weeks, and then returned to South Haven. The Slocums collected about twelve hundred dollars of accounts, from which they took the amount due themselves. A part of the balance was paid to M. L. Ryland for the purpose of paying other debts of W. K. Ryland. A small sum of money was paid to Mrs. W. K. Ryland and some of it was paid to W. K. Ryland after his return. Some of the accounts were closed by taking notes payable to Mrs. W. K. Ryland. W. K. Ryland also had agricultural implements, which he sold on commission. Among them were goods belonging to the Buford & George Implement Company, valued at about six hundred dollars. At the time the sale from W. K. to M. L. Ryland was agreed upon, it was understood that commission goods were to be turned over by M. L. Ryland to the owners. W. K. Ryland had given his note to the Buford & George Implement Company for the goods received from them, and M. L. Ryland claimed that these goods were included in his purchase, but after a time gave them up. The items of indebtedness for which the transfer was made, as stated by the plaintiff, were : A balance of $1,168.26, claimed to be due for payments made by M. L. Ryland in excess of his half of the cost of the brick store-building above mentioned, which was erected in 1868 ; $90 paid to W. A. Clark ; $27.87 for half of awning ; $92.76 for taxes paid at various dates ; Foster note, $100 ; store account, $110.46 ; cash, $20 ; interest, $674.54; the total, including the item of $16.50 paid to Tom Hill, amounting to $2,300.39. The jury, in answer to special questions, found the value of the hardware stock covered by the bill of sale to have been twenty-eight hundred dollars. The suit of Aultman, Miller & Co. was to recover $1,432.20 due them from W. K. Ryland for binding twine ; and on this claim the attachment was issued, and levied by the sheriff on the stock of hardware in controversy. W. K. Ryland was also indebted to various other parties ; and it is conceded that he was insolvent at the time of the transfer of his stock, and made no provision for the payment of his other creditors. A vast mass of testimony, much of it wholly irrelevant and calculated to confuse if not mislead the jury, was introduced at the trial, and is all contained in a very voluminous case-made filed in this court. At the conclusion of the testimony, the court was requested to charge the jury in writing, and counsel for both parties submitted special instructions. From those asked, the court selected a large number, which were given to the jury, and rejected many of those requested by the defendant. The instructions as given contain twenty-seven paragraphs. The third instruction asked by the defendant, and refused, reads as follows : “ While it is true that the law never presumes fraud without some evidence of it, yet, in order to show fraud, direct and positive proof is not required. The jury may infer fraud from the circumstances proven by the evidence, if in the minds of the jury they are such as show that fraud was practiced. Fraud may be proven by circumstantial evidence as well as by direct and positive proof. It may be inferred from strong presumptive circumstances, and while it is true that the party alleging fraud must prove it, yet in civil actions, like this, the party alleging fraud is not bound to prove it beyond a reasonable doubt. It is sufficient if the fact of fraud is established in the minds of the jury by the greater weight of evidence.” Instruction ten, asked by the defendant, and refused, is as follows : “ If you find from the evidence that at the time the plaintiff claims he purchased the goods in controversy from W. K. Ryland, said W. K. Ryland was attempting to dispose of his property with the intent to defraud his creditors, or hinder or delay them in the collection of their debts, and that such intention was known to the plaintiff, or that the plaintiff had knowledge of facts sufficient to awaken the suspicion of an ordinarily prudent man and lead him to make inquiries, and further find that said M. L. Ryland in the purchase of said goods did not allow an adequate price therefor, your verdict should be in favor of the defendant, although you may find that the debt which the plaintiff claims W. K. Ryland owed him was a bona fide debt.” The first question submitted to the jury was : “ Did W. K. Ryland on the first and third days of July, 1893, dispose, or attempt to dispose, of his property, or any part thereof, with the intent to defraud his creditors, or any of them, or hinder or delay them in the collection of their debts against him, or conceal or attempt to conceal his property or any part thereof for such purpose?” And the answer thereto was “No.” The jury returned a general verdict in favor of the plaintiff. A motion for a new trial was overruled and judgment entered on the verdict. The Sheriff brings the case here for review.