Ingram v. Smith

Gibson, C. C. — Plaintiff appeals from a judgment for defendants, rendered upon their general demurrer to his- amended complaint.

It appears from the complaint, which contains much evidential matter that should have been omitted, that on November 8, 1888, Smiley, being then insolvent, made an assignment for the benefit of his creditors to the plaintiff, who accepted the trust and qualified as such assignee.

[235]Smiley, on the third da}r of October of the samé year, was, and for a long time prior thereto had been, engaged in the business of dealing in merchandise, and was indebted to divers parties in different amounts, aggregating more than five thousand dollars, which he was, on the last-mentioned date, unable to pay in accordance with the terms of his several obligations, although possessed of personal property reasonably worth six thousand dollars. On or about that date, Smiley, for the purpose of hindering, delaying, and defrauding his creditors, and of securing to himself and his co-defendant, Smith, the benefit of his property, fraudulently entered into an agreement with him, the terms of which are to plaintiff unknown, but the moving consideration was, that Smiley was to pretend to convey and assign to Smith all his property for the alleged consideration of two thousand three hundred dollars, asserted to be due to Smith from Smiley, when in fact he was not in any way indebted to Smith. Pursuant to this transfer, Smith claimed to be in possession of all the property from the 3d until the 22d of October, 1888, during all of .which time, however, Smiley continued to exercise acts of ownership over it, making sales of merchandise, taking pay therefor, and communicating with his creditors as though he had not parted with his property. Smith, who is, and was at all times mentioned in the complaint, without property, and wholly dependent upon his earnings for a livelihood, knew of the insolvency of Smiley; and all his acts performed in concert with Smiley were for the purpose of cheating the creditors of the latter for their joint benefit.

About October 20, 1888, a firm of wholesale dealers in Sacramento, who were creditors'of Smiley, first learned of the transfer to Smith, Smiley having never prior to that time disclosed to his creditors that Smith was one of them. On the 22d of the same month, after an interview with a member of the said firm, Smiley procured [236]