Case ID: ad_100/html/0343-01.html
Source: Caselaw Access Project
Author: {"author": "Hatch, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Grant C. Fox, Respondent, v. William Erbe and Elizabeth Erbe, the Elder, Appellants, Impleaded with Elizabeth Erbe, the Younger.
    
      ■Creditor's action — admissibility of a judgment roll, in an action involving the ownership by the judgment debtor of property, the proceeds of which it was alleged were fraudulently transferred, by him — a general objection to evidence competent as to some of the transferees only—a judgment in an equity action, when not ■set aside for error in the admission of evidence —judgment limited to one only of several alleged fraudulent transfers—effect of the fraudulent transferee hawing disposed of the property—when a personal judgment against such transferee is proper—equity may adapt the relief to the pa/riieular circumstances.
    
    Jin an action brought against William Brhe, his mother, Elizabeth Erbe, the elder, and his sister, Elizabeth Brhe, the younger, it appeared that in 1903 the plaintiff recovered a judgment for legal services rendered by him to the defendant William Erbe, as counsel in an action brought by one Sheehan ■ against the said William Erbe to set aside an assignment of a lease executed by Sheehan to Erbe; that an execution issued on the plaintiff’s judgment was returned unsatisfied; that a short time prior to the rendition of the plaintiff’s judgment the defendant William Erbe transferred certain moneys and personal property to his mother, Elizabeth Erbe, the elder, and his sister, Elizabeth Erbe, the younger. One of such transfers made to his mother consisted of money derived from the leasehold interest which had been assigned by Sheehan to William Erbe, and the court found, on sufficient evidence, that this money belonged to William Erbe individually, and that the transfer thereof to his mother was in fraud of creditors.
    
      JSeld, that the judgment roll in the action brought by Sheehan against William Erbe was admissible against the latter, for the purpose of showing his ownership of the lease and of refuting his claim that he held the lease as trustee of his mother;
    'That such judgment roll was also admissible against the other defendants, for the reason that the matter contained in the judgment roll tended to contradict the testimony given by William Erbe, when sworn as a witness on behalf of the other defendants, and was, therefore, admissible against such other defendants as affecting the credibility of one of their witnesses;
    'That, assuming that the judgment roll was only admissible as against Willianj Erbe, the trial court properly overruled a general objection to its admission, as, if the other defendants contended that the judgment roll was not admissible against them, it was their duty to ask the court to limit the effect of the admission of the judgment roll and not to reject it entirely;
    That a judgment rendered in an equity action will not he reversed because of the admission of incompetent evidence, if there is an abundance of competent evidence to sustain it;
    
      That, as the plaintiff was the only creditor o£ William Evbe" seeking relief, and. as the moneys fraudulently transferred to his mother as above set forth were 'sufficient • to satisfy the plaintiff’s claim, the trial court properly limited the. application of the judgment to such moneys, and was not obliged to set aside ■ all the transfers;
    That, so far as the liability of the mother for such moneys was concerned, it was. not material that she subsequently mingled such' money with other moneys and assented to their deposit in a bank in the name of another person;'
    That the facts were sufficient to sustain á personal judgment against the-mother; for an amount sufficient to satisfy the plaintiff’s claim;
    That a court of. equity has power to adapt its relief to the exigencies of a particular case and may award a personal judgment against a party in lieu of' setting aside a transfer where the facts establish the right to such personal, judgment. '
    Ingraham, J., dissented.
    Appeal by the defendants, Williani Erbe and another, from a: judgment of the Supreme Court in favor of the plaintiff, entered in the-office of the clerk of the county of New York on the 4th day of February, 1904, upon the decision of the court rendered after a. trial at the New York Special Term.
    
      James P. Niemann, for the appellants.
    
      Grant C. Fox, for the respondent.
   Hatch, J.:

This action was brought to set aside the transfers of personal property made by the appellant William Erbe to his mother, Elizabeth Erbe, and his sister, Elizabeth Erbe. William Erbe is a lawyer,, unmarried, and has always lived with his mother and his sisters Elizabeth and Margaret.- In April, 1896, one Sheehan"assigned to William, alease of premises situate at One Hundred and .-Thirty-first -street and. Twelfth avenue. In 1901 Sheehan brought an action against William Erbe to set aside this assignment. The respondent was counsel therein for the defendant upon the first trial of said action and in the argument, upon an appeal. " In January, 1903, respondent brought an action in the Supreme Court of Kings county against William Erbe to-recover for his services in the Sheehan action, and on May 22,1903,. a judgment was taken against William Erbe by default. This was-subsequently reopened and after a trial before a jury a judgment! was entered upon a verdict rendered in favor of the respondent herein and against the said William Erbe for $1,710.05 and executian was issued to the sheriff of New York county upon the same day. On July 14,1903, the execution having been returned unsatisfied, an examination of the defendant in proceedings supplementary to execution was had. On May 4, 1903, William Erbe withdrew what was known as “Account No. 1” in the Morton Trust Company of $34,612.17, and there was opened on the samé day in the same company an account for the same amount in the name of his sister, Elizabeth Erbe, the younger. On May 22, 1903, the date of the taking of the judgment by default, William Erbe withdrew an account of $1,162.84 from the Emigrant Industrial Savings Bank, and paid the same over to his mother. Upon the same day he withdrew another account in the Morton Trust Company known as-“No. 2of'$7,921.01 and turned the cash over to his mother. Upon the same day he also closed out an account of $593.76 in the G-ermania Bank, using the money for personal expenses. On June 22, 1903, two days after the entry of the second judgment against him, William Erbe withdrew an account in the Union Dime Savings Institution of $639.20, and on the same day an account was opened in the same bank for the same amount in the name of liis sister, “ Elizabeth Erbe, the younger.” Upon the same day he also withdrew an account in the Metropolitan Savings Bank of $416.79, and on the same day an account was opened in the same bank in the name of his sister, “ Elizabeth Erbe, the younger.” All of these transfers were made at the request of his mother, Elizabeth Erbe, the elder; nothing was paid therefor-and they were made for the express purpose of preventing this respondent from reaching the money. All of these accounts were in the name of William Erbe at the time of the transfer and had been for years. On August 21, 1903, all of these accounts were withdrawn and after this action was commenced and about three weeks before ■the trial the whole, amounting to about $40,000, was deposited with the Farmers’ Loan and Trust Company in the name of the sister Margaret Erbe. On May 6,1903,'William Erbe caused to be issued by the Central Trust Company a certificate for fifty shares of the capital stock of the Brooklyn Rapid Transit Company in the name of his mother and had the certificate which had stood in his name for three years canceled. Some time between November 17, 1902,. and September 18,1903, William Erbe transferred to his mother fifty shares of the preferred- stock of the St. Louis Southwestern Railway Cómpány, which he purchased November 17,. 1902. Between December 15,.1902, and September 18, 1903, William transferred to liis mother or sisters other property arid deposits, so that thereafter he had no property remaining in liis name from which the said judgment could be collected. The court below decided that the deposit of .$7,921.01 in the Morton Trust -Company belonged to William Erbe and that he had transferred the same to liis mother in fraud of creditor. .

It is claimed upon the part of the appellants that all. of the moneys which went to make up the various amounts, as well as title to -all of the property transferred, while in the name of the. deferid-, arit William Erbe was, nevertheless, money and property held by him in trust for his mother; that it had been derived'from the estate ■of his father, the whole of winch'had been given to liis mother, and that William Erbe never had any beneficial interest therein., It is. , undisputed that the money' in the various banks was deposited in his name and the property which' lie.purchased and-transferred upon its face appeared to be an individual transaction, in which no element of trust appeared. All of the transfers save as evidence are immaterial to the jiresent issue, except the account known as “ No. A” in the Morton Trust Company,"amounting to $7,921.01, as that is the only money or property affected by this judgment.' It is undisputed that this money was realized from the, property at One ■.Hundred and Thirty-first street and Twelfth avenue, in which William Erbe was the assignee of the lease from Sheehan. Upon the face •of that -transaction nothing appeared to show that any other person had any interest in the leasehold1 estate so assigned, except William .Erbe. and the assignor".' Elizabeth Erbe, the mother, was not mentioned in the transaction, nor named in the papers, nor proceeded •against by Sheehan, when he brought liis action to set aside the assignment. ■ In no form, either by pleading or otherwise, was any interest of any character averred to exist in the mother of William Erbe." The money which went to make up the account last mentioned was traced from this leasehold estate into a bank account in .the name of William Erbe. The proof;was, therefore, sufficient for the court to find that.this money was the property of William Erbe, and as this finding is fairly deducible from all the evidence which was given this ’court would not be justified in reversing or otherwise interfering with, it based upon a lack of the evidence to support it. (Slayback v. Raymond, 93 App. Div. 326.)

The appellants urge, however, that error was committed upon the trial which calls for a reversal of the judgment. The plaintiff to sustain his cause of action offered in evidence the judgment obtained by Sheehan against William Erbe. There can be no question but that this judgment was evidence against William Erbe. Its direct effect was to show that he was the owner of the leasehold interest under" the transfer from Sheehan. The averments of his answer set' up a claim of ownership, in consequence of which they were competent as declarations respecting the ownership of the leasehold property, and as the money reached by the judgment proceeded from such source the connection was complete. It is said, however, that even though this judgment be admissible against William Erbe it was not so admissible against the other parties to the action. This claim cannot be sustained for two reasons.1 The objection to the admissibility of the judgment roll was general in character. It was not suggested that it was not admissible against these parties, and the ground of the objection went to its entire exclusion. It called for that and nothing else. As it was admissible against one the court was not "authorized to reject it entirely, and if the other defendants sought to limit its application they were required to call the matter to the court’s attention. Hot having done so, the objection that it should have been rejected or so limited is not available. (Stowell v. Hazelett, 66 N. Y. 635; Keegan v. Third Ave. R. R. Co., 34 App. Div. 297, 301, 302; affd. on appeal, 165 N. Y. 622.)

Aside from this question it appeared that the matter contained in the judgment roll tended to contradict the statements and claim made by William Erbe upon this trial. His present claim is that he had no personal or beneficial interest in the leasehold estate, but that it belonged entirely to his mother. The averments contained in the answer and his other declarations connected with it, as was also the judgment granted therein, were inconsistent with such claim; consequently the contents of the judgment roll tended to contradict upon a material matter the statements and evidence of William Erbe given upon the trial. This affected his credibility as a witness. It is always competent so show contradictory statements made by a witness as bearing upon his credibility and this may consist of oral or written declarations. (Stephens v. People, 19 N. Y. 549; Gaffney v. People, 50 id. 416; New York Guaranty & Ind. Co. v. Gleason, 78 id. 503.) It has been held that an examination in supplementary proceedings, which contained declarations of a party inconsistent with those,given upon a trial which sought to set aside a transfer as fraudulent, was not only admissible against the person making them, but was also admissible against'other parties to the action as bearing, upon the credibility of the witness. (Wright v. Nostrand, 94 N. Y. 31.) It is clear, therefore, that this judgment roll was not only admissible against William Erbe as a declaration and admission, but was also admissible against the other defendants as bearing upon his credibility, they having offered him as a witness. The evidence taken in the account proceeding, the examination in supplementary proceedings and the other papers and proceedings which- were admitted and which have been urged upon our attention -upon this appeal as constituting error are each alike in the same condition so far as admissibility in evidence is concerned as was the Sheehan judgment, and the same rule must apply to each.

The admission of the examination in supplementary proceedings it is now suggested was erroneous for the further reason that such examination was not properly authenticated. Xo objection interposed by the defendants raised such question, and it appeared in the record to have been properly signed by William Erbe and otherwise properly authenticated. It may be that some of this testimony was immaterial upon the issue, but the bulk of it was not only material and relevant, but important as bearing upon the issue litigated. So far as it was immaterial or irrelevant to the issue it did not work harm to the defendants. It may be said, excluding it from consideration entirely, that'there is an abundance of competent evidence to. sustain this judgment, and under such circumstances the court is not justified in reversing it, even though some of the evidence was not admissible, (de St. Laurent v. Slater, 23 App. Div. 70.) There is nothing, therefore, in the rulings upon the admissibility of evidence upon the trial which calls for reversal of the'judgment.

The judgment in form is correct. It was not essential that all of the transfers should be set aside, as the only creditor seeking-relief was the plaintiff in the action, and his claim could be satisfied by making ■ the judgment applicable to a particular sum of money sufficient to satisfy it. As we have already observed, it was made clearly to appear that the proceeds of the leasehold premises finally came to rest in the account in the Morton Trust Company. known as “No. 2.” It is also undisputed that this sum of money was drawn out and delivered over to Elizabeth Erbe, the elder. It having belonged to William, and she having received it without consideration and for the purpose of preventing the plaintiff in this action from reaching it, she is properly chargeable with its amount. So far as her liability is concerned, it is not of consequence that she subsequently mingled this money with other moneys and assented to its deposit in a bank in the name of Margaret Erbe. The facts were sufficient upon which to found a personal judgment against her for that amount.. A court of equity has the power to adapt its relief to the exigencies of the case and may award a personal judgment against a party in lieu of setting aside a transfer where the facts establish such personal liability. ' (Baily v. Hornthal, 154 N. Y. 648; Murtha v. Curley, 90 id. 372.) We find no defects in this judgment which call for a reversal.

It should, therefore, be affirmed, with costs.

Van Brunt, P. J., O’Brien and McLaughlin, JJ., concurred; Ingraham, J., dissented.

Judgment affirmed, with costs.