PHILIP D. ARMOUR, JONATHAN D. ARMOUR AND PHILIP D. ARMOUR, JR., PARTNERS AS ARMOUR & COMPANY, PLAINTIFFS IN ERROR,
v.
DAVID H. DOIG, DEFENDANT IN ERROR

Fla. | 1903-01-01
45 Fla. 162 Florida Supreme Court (1903) Negative Treatment
Cited by 6 cases

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Synopsis

Armour & Company obtained a judgment against Harry A. Henry and sought to garnish funds held by Henry's assignee, David H. Doig, under a general assignment for the benefit of creditors. The Florida Supreme Court reversed the trial court's directed verdict for the garnishee, holding that evidence of Henry's prior financial statements should have been admitted to show he concealed property in violation of the assignment.


Holding

The court held that the trial court erred in excluding the financial statements and testimony because they were admissible to show that Henry had not turned over all his property to the assignee, constituting fraud on creditors that would render the assignment void. The evidence should have been submitted to the jury to determine whether Henry fraudulently withheld or secreted property.


Key Quotes

“If the assignor intentionally withheld or secreted a part of his property, and did not turn the same over to his assignee, this would have been a fraud on the creditors of the assignee, which would have rendered the assignment void.”

Establishes the legal principle that fraudulent concealment of property in a general assignment renders it void as to creditors.

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Facts & Procedural History

On May 17, 1898, Armour & Company sued Harry A. Henry in assumpsit and filed a garnishment against D.H. Doig as garnishee. On May 16, 1898, Henry exec…

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Opinion of the Court
Hooker, J.

This was all the evidence introduced or proffered in the case, and upon the evidence so introduced, the parties having concluded their testimony, the court of its own motion charged the jury as follows: “Under any view of the law in this case yon can only render a verdict for the garnishee. You will, therefore, return a verdict in favor of the garnishee in this case;” to which charge of the court the plaintiff then and there excepted. A verdict and judgment were then given as before recited, for the garnishee.

The assignments of error are, first, the court erred severally in sustaining severally defendant’s objections severally, to the introduction of the several writings, so marked No. 3 and 4, in the bill of exceptions, and ex eluding the same from the jury. Second, the court erred severally in sustaining severally the defendant’s several objections to the proffered testimony of the several witnesses, Coates and Conroy and excluding the same from the jury. Third, the court in the charge to the jury given “mero mota” to return a verdict, in favor of the garnishee in this case erred.

Hooker, J.

(after stating the, facts.)

The first and second assignments of error may be treated together. The written declarations of his financial condition referred to as exhibits 3 and 4 were made December 1st, 1897. The deed of assignment was executed May lfith, 1893. Henry testified that his financial condition had not substantially changed between those dates. In exhibits 3 and. 4 he had stated that his total assets were worth $34,000, and his total liabilities were $8,400, and his net wealth $26,300. The total of the property turned over by Henry to his assignee, JDoig, was appraised at $9,478.96. At the time I.)oig filed his answer herein he testified that he had realized from the assets $4,300, not including the exempted property, and that he had on hand $5,300 at the time of the trial, viz: December, 1898, seven months after the date of the assignment. It is contended by the attorney for the defendant in error that the Circuit Judge, did not err in refusing to allow the plaintiff to introduce the statements of Henry made to plaintiffs and the Bradstreet. Company (exhibits 3 and 4) on the ground “that false, statements made hv the assignor as to his financial condition, made before the assignment, and unconnected therewith, do not support the allegations of fraud in the assignment.” Authorities are referred to in the brief of defendant in error which sustain this contention. On the paid of the plaintiff in error, however, if is coni ended that this evidence was not offered for the purpose of showing that the statements therein made were1 false, hut that they were true, and that they tended to show the assignor Henry had not turned over to his assignee, Doig, all his property, but was fraudulently concealing portions of his property so as to make the assignment fraudulent and void as to the plaintiff in error, who was a judgment creditor. If the assignor intentionally withheld or secreted a part of his property, and did not turn the same over to his assignee, ibis would have been a fraud on the' creditors of ihe assignee, which would have rendered the assignment void. Coursey v. Morton, 132 N. Y. 556, 30 N. E. Rep. 231; Burrill on Assignments, see, 314; Farrington v. Sexton, 43 Mich. 454, 5 N. W. Rep. 654; Parker v. Cleveland, 37 Fla. 39, 19 South. Rep. 344.

If the evidence contained in the statements made by Henry to plaintiffs and the'Rradstreet Company, and referred to as exhibits 3 and 4, would have had a teudencv to sliow to the jury that Henry liad assets which he did not turn over to his assignee, it seems to us that the plaintiff should have been permitted to introduce it, inasmuch as Henry testified that he had suffered no material losses and Lis business liad not materially changed between the dates of these statements (Dec. 1, 1897) and the date of the assignment (May 16, 1898). Farrington v. Sexton, supra; Roberts v. Vicetor, 54 Hun, 461, 7 N. Y. S. 777.

While not intending to pass upon the sufficiency of this evidence to establish > the indicated fraud, we think it should have been submitted to the jury with the other evidence, aud the jury should have had an opportunity to pass upon it. McNamara v. Corporation of New Melleray, 88 Iowa, 502. 55 N. W. Rep. 322. This court can not determine what would have been the effect of this testimony if it had been submitted to the jury. Hays v. Ernst, 32 Fla. 18, 13 South. Rep. 451; Elliott App. Pro. sec. 594; 2 Ency. Pl. & Pr., 532 note 2. It is contended by defendant in error that this evidence was properly.ruled out because if liad a tendency to impeach the witness Henry who was introduced as a witness by the plaintiff, and therefore could not he impeached by the plaintiff. The witness Henry was introduced by the plaintiff, and on examination by the defendant’s attorney did testify that he had turned over all his property to his assignee, Doig. Tliis testimony was given by Henry in direct answer io the defendant’s attorney, and not in cross-examination anon any matter upon which the plaintiff had questioned •him. Henry, however, was an adverse'witness, and there is no legal reason why his testimony should not have been controverted by the plaintiff. The circumstances and occasion of his former statements having been sufficiently brought to his attention, and this the proffered and rejected evidence tended to do. Rev. Stats, sections 1101 and 1102; 3 Jones (Burr W.) on Evidence, section 861; Webber v. Jackson, 79 Mich. 175, 44 N. W. Rep. 591; Montgomery v. Knox, 23 Fla. 595, 3 South. Rep. 211; Croker v. Agenbroad, 122, Ind. 585, 24 N. E. Rep. 169. As it had a bearing on the facts in issue, we think the court below erred in rejecting the proffered testimony of the plaintiffs’ witnesses Coates and Conroy. First Nat. Bank of Bath v. Warner, 55 Hun, 120, 8 N. Y. S. 765. A wide •latitude is allowed on the proof of fraud. C. B. Rogers Co. v. Meinhardt, 37 Fla. 480, 19 South. Rep. 878. It can be added that the witness Henry being an interested one, it was for the jury to determine what weight, if any, they should give his testimony. Elwood v. Western Union Telegraph Co., 45 N. Y. 549; 6 Ency. Pl. & Pr., 696, and note 2, and this comment will be particularly applicable to the third assignment of error. Quock Ting v. United States, 140 U. S. 417, 11 Sup. Ct. Rep. 733, 851.

it is strenuously contended by the plaintiff in error that the deed of assignment offered in evidence by him is void as containing purposes and trusts whieh are-in violation of our law providing for assignments for the benefit of creditors. It is objected that the deed only requires the-assignee to take possession and soli the assigned property “wi1h all reasonable despatch” and that this is in conflict with the statute (section 2312 Rev. Stats.) which provides that the assignee ‘‘shall as soon as the foregoing provisions have been complied with proceed to dispose of all the property mentioned in the deed of assignment to him to the best interests of all the parties concerned at public or private sale as to him may seem best.” We do not think that the language of the deed which is criticised necessarily imposes upon the assignee the duty of proceeding in any manner contrary to the statutory directions in disposing of the property. Dorr v. Schmidt, 38 Fla. 354, text 362, 21 South. Rep. 279. If he followed strictly the statute he would not violate the letter or spirit of the directions in the deed, and unquestionably be should follow the statute.

It is also insisted that a part of the property described in the deed is conveyed to the assignee charged with a trust in favor of the assignor, because it is conveyed “subject to homestead exemption.” This phase “subject • to homestead exemption,” taken by itself is doubtless subject to criticism, and is of somewhat ambiguous meaning, but it is followed in the deed by a description of all the property of the grantor, general in its terms, “except such property as is exempt by law from levy and sale under execution under the constitution and laws' of Florida.” In Barton v. Fitzgerald, 15 East, 530, Lord Ellenborough said: “It is a rule of construction that the sense and meaning of the parties in any particular part of an instrument may be collected ex antecedentibus et eonsequentibus; every part of it may be brought into action in order to collect from the whole one uniform and consistent sense, if it may be done.” This rule was approved and applied by the court in that case. Applying the same rule here (here appears 1o be no doubt that the assignor Intended to convey all Ins property to the assignee, “except such property as he might exempt under the law, and i*»is under the decisions of this court he might do without, viola Hug the assignment law of the State. 17 Am. & Eng. Ency. of Law (2nd ed.) 4. In Dorr v. Schmidt, 38 Fla. 354, 21 South. Rep. 279, on page 3C2, this court has said: “An assignment, though voluntary under the statute, should not be construed to deprive one of a constitutional right, by waiver, when it is clear that he did not intend to waive it, but claimed and insisted on the same in the deed of assignment itself. * * * As the purpose expressed and understood at the time of the exec at ion of the assignment in question was simply to claim exemptions to which the assignor was entitled by law out of the property assigned, there was no fraud in 'law or fact in the execution of the instrument.” The record allows that the assignor, a day or two after the execution of the deed of assignment, selected $1,000 worth of the persona] property as exempt under the exemption laws which was set aside by the assignee to him without appamit charge or burden of any kind upon the trusts for the. benefit of creditors, and in conformity with the intent of the deed.

Then' is also some criticism of the provision of the deed auihori-dng the assignee, out of the proceeds of the trust property, to first pay and discharge all just and reasonable ertponaes of executing the assignment and carrying inn to effect the trust created, together with all legal and proper compensation and commission of the assignee for services in executing the trust. It is not apparent that these specified purposes of the trust are contrary to the statute, and are not such as are perfectly consistent therewith. Dorr v. Schmidt, supra, pp. 363 and 364. The assignee, i! hi' properly performed his trust, would he en-f.i(led ¡o reasonable compensation for his services, and v ould be reimbursed all reasonable and necessary expenses Mmnrml in administering-the trust, even if the deed of assignment did not specifically provide for these allowances.. 3. Am. & Éng. Ency. of Law (2nd ed.) 117.

Because of the errors in refusing the plaintiff the right to introduce in evidence the written statements referred to as exhibits 3 and 4, and the proffered testimony of the witnesses Conroy and Coates, the judgment of the Circuit Court in said cause is reversed and a new trial ordered at the cost of the defendant in error.


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Citator

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  • S. Home Ins. Co. v. Putnal, 57 Fla. 199 (Fla. 1909)
    …ee Baker v. Chatfield, 23 Fla. 540, 2 South. Rep. 822; Simmons v. [*220] Spratt, 26 Fla. 449, 8 South. Rep. 123, S. C. 9 L. R. A. 343; Hays v. Ernest, 32 Fla. 18, 13 South. Rep. 451; Mayer v. Wilkins, 37 Fla. 244, 19 South. Rep. 632; Armour v. Doig, 45 Fla. 162, 34 South. Rep. 249; Pensacola Electric Ter. R. Co. v Haussman. 51 Fla. 286, 40 South. Rep. 196, and authorities there cited; Walker v. Parry, 51 Fla. 344, 40 South. Rep. 69. It is true that these cited cases do not deal with erroneous rulings on th…
  • Fla. E. Coast Ry. Co. v. Thompson, 93 Fla. 30 (Fla. 1927)
    …nation of direct and circumstantial evidence. Miller v. Spokane Int. Ry. Co., 143 Pac. Rep. 981; Frazier v. Missouri Pac. Ry. Co., 154 Pac. Rep. 1022, In re: Everett, 68 S. E. Rep. 925. And a wide latitude is permitted in proving it. Armour v. Doig, 45 Fla. 162, 34 South. Rep. 249. But it is always incumbent upon the party asserting the fraud to establish the existence thereof by evidence measuring up to the rule above stated. See 27 C. J. 65 (200). Where the parties to a written release of liability for…
  • Laberge v. Vancleave, 534 So. 2d 1176 (Fla. 5th DCA 1988)
    …t is determinative of the lawsuit.1 Accordingly, we reverse the orders for directed verdict and new trial appealed in this case and remand for entry of a judgment consistent with this opinion. COBB and DANIEL, JJ., concur. . Armour & Co. v. Doig, 45 Fla. 162, 34 So. 249 (1903). . See Robertson v. Robertson, 106 So. 2d 590 (Fla. 2d DCA 1958). . § 627.737(2) and (3), Fla.Stat. (1985); Calhoun v. New Hampshire Ins. Co., 354 So. 2d 882 (Fla.1978) (plaintiff may not relitigate if jury verdict of negligence…

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