Williams v. Shelly

Williams v. Shelly. Execution.—Bond fide purchaser. Á surety who purchases the goods of Ms principal, and assumes a primary liability in respect thereto, is a bond fide purchaser thereof, as against an execution not actually levied. One who purchases .from a judgment-debtor, after execution issued, must show affirmatively that his purchase was in good faith, and without notice. Appeal from the general term of the Supreme Court, in the eighth district, where a judgment entered upon a verdict in favor of the plaintiff, with a reduction of the amount, had been affirmed. This was an action by John H. Williams against Chester F. Shelly, sheriff of Niagara county, for the seizure and conversion of a quantity of dry goods, under an execution against the firm of Mitchell & Derry. It was shown on the trial, that in the spring of 1857, Mitchell & Derry were carrying on the mercantile business, as partners, in Niagara county; that, at that time, they went to New York, and agreed for the purchase of a large amount of goods; that some of the purchasers refused to deliver the goods, without security, and, thereupon, Mitchell & Derry wrote to the plaintiff to come to New York; that the plaintiff went to the city, and there became surety for Mitchell & Derry- for the price of the goods, which were then delivered and forwarded to the store occupied by Mitchell & Derry. The evidence was conflicting upon the question, whether it was agreed between tbe plaintiff and Mitchell & Derry, that the former should become a partner in the business. It was claimed, on the part of the plaintiff, that such an agreement was made. On the 21st of May 1857, an agreement in writing was entered into between the plaintiff and Mitchell & Derry, by which the partnership was declared to be dissolved, and Mitchell & Derry transferred to the plaintiff all their interest in the goods for which the plaintiff had become security, and the plaintiff agreed to pay for said goods, and to indemnify Mitchell & Derry against their liability therefor. • It was further proved, that the plaintiff took possession of *the goods, and that the defendant thereafter took and sold the same. On the part of the defendant, it was proved, that he was sheriff of Niagara county; that, before the 21st of May, several executions were placed in his hands against Mitchell & Derry, with instructions not to levy, until further directions; that, shortly before the 21st of May, another execution against Mitchell & Derry was placed in his hand's for collection; that he, shortly after the 21st of May, levied upon the goods in question, by virtue of such executions, and sold the same thereon. The several judgments upon which the execrations were issued, were proved, and evidence was given tending to show that the plaintiff was aware of the insolvent condition of Mitchell & Derry, and also of the existence of judgments against them. At the close of the testimony, the defendant’s counsel requested the court to direct a verdict in favor of the defendant; which was refused, and an exception taken. The defendant’s counsel then requested the court to charge the jury, that, if the only consideration of the sale to t'he plaintiff was the execution of the agreement, by which the plaintiff agreed to assume and pay the debts therein specified, then the plaintiff was not a purchaser in good faith, &c. The judge refused so to charge, and the defendant’s counsel excepted. The counsel also requested the court to instruct the jury, that if the sale was only intended as a security, then it was not within the protection of the statute, although in good faith. This was denied, and another exception taken. The learned judge charged the jury, that it was necessary, in order to charge the property with the lien of the executions, that the defendant should show, and the jury should find, that the plaintiff had notice, in some form, of the issuing of the executions; that notice of the judgments was not sufficient; that, if the bill of sale was intended as a security for indorsing the notes, ■and was without other consideration, yet, if the same was in good faith, before levy, and without notice of the issuing of the executions, the plaintiff’s right to the goods would be superior to that of the sheriff under the executions. To which several rulings, the defendant’s counsel excepted. The jury rendered a verdict in favor of the plaintiff, but the court, at special term, ordered that the same be set aside, *unless the plaintiff stipulated to remit a portion of the damages found by the jury; which having been done, judgment was perfected for the residue. And the said judgment having been affirmed at general term, the defendant appealed to this court. Ely, for the appellant. Davis and Piper, for the respondent. Also reported in 4 Trans. App. 314. [MAJORITY — Gkover, J.] Gkover, J. (after stating the facts.)—There was no exception to any -ruling of the court upon the question of damages, taken upon the trial; no such questiou can, therefore, be entertained by this court. It was competent for the special term, in case the damages found were excessive, to order a new trial, unless the excess was remitted by the plaintiff, and, in that event, to deny it. The action of the special term, in that respect, under the facts of this case, cannot be reviewed here. At common law, an execution bound the personal property of the defendant, from its teste, even against a bond fide purchaser. (Cro. Eliz. 174; Audley v. Halsey, Cro. Car. 148.) This was altered by 29 Car. II., ch. 3, §16, making such purchase valid, if made before the delivery of the writ to the sheriff. 2 Revised Statutes (p. 613, § 13) provides that the goods and chattels of a debtor shall be bound only from the time of the delivery of an execution to be executed: § 17 provides, that the title of any purchaser in good faith of any goods or chattels, acquired prior to the actual levy of any execution, without notice of such execution being issued, shall not be divested, by the fact that such execution had been delivered to the officer prior to such purchase. The exceptions in the present case present the question, whether the consideration was such as to constitute the plaintiff a purchaser in good faith within the meaning of the statute. There was no conflict in the evidence upon that point; the plaintiff had become surety for the payment for the goods, upon the purchase by the execution-debtors; he agreed, upon his purchase of their interest from them, to pay his indebtedness, and to ^indemnify them against it. He thus as.sumed a new liability; he became the principal debtor, instead of surety for others. The assumption of a new liability has always been held a sufficient consideration to constitute the party assuming it a purchaser in good faith. The requests of the defendant’s counsel to charge upon this point were properly denied, upon the ground, that the proof did not warrant the submission of any question to the jury upon this point. The same answer may be given to the charge as given. The judge would have been warranted by the proof in directly charging the jury that the consideration was sufficient. It was not possible that the defendant could have been prejudiced by the charge in this respect. It is insisted, by the plaintiff’s counsel, that a transfer of property, to secure an antecedent debt, is a sufficient consideration within the statute; and the counsel cites Birdseye v. Ray (4 Hill 158, and s. c. 5 Denio 619), in support of this proposition. The opinion of Nelson, J., as reported in Hill, sustains it; but the case was decided upon another ground. It was controverted by the Chancellor, in Denio, but the point was not passed upon by the court. The question cannot be regarded as settled by this case, as adjudged in either court. Although the question is not necessarily involved in the present case, I will remark, that I can see no reason, either in principle or upon authority, why any consideration should make a purchase bond fide, under this statute, that will not have the ■ same in effect any other case, when necessary to sustain a title on account of a defect in that of the vendor. The charge upon the question of notice of the issuing of the execution to the plaintiff, presents a nicer question. The charge implies that the onus was upon the sheriff to prove that the plaintiff had notice of the issuing of the execution, at the time of the purchase. We have seen, that the lien attaches upon the delivery of the execution to the officer for collection; that this lien is valid against all but purchasers in good faith, without notice. It would seem to follow, that the .onus was upon the purchaser, to establish all the facts essential to show his title valid against the lien. This he does, primd facie, when he shows a purchase in the ^ordinary course of business. The statute was passed before parties were competent* witnesses in their own behalf. Under such circumstances, it would have been impossible for the plaintiff to prove a want of knowledge of the delivery of the execution. The defendant, upon this point, holds the affirmative; and it is a general rule of evidence, that a party alleging the affirmative must prove the fact. To this rule, there are some exceptions ; but this, I think, does not come within them. It is a well-settled rule in equity, that, where notice of some fact will subvert a title, valid in its absence, such notice must be proved by the party alleging it; although, in pleading his title, notice must be denied. My conclusion is, that the charge, in this respect, was correct, and that the judgment must be affirmed. Judgment affirmed