The Hawaiian gazette., 1885-02-04
Supreme Court of the Hawaiian Islands =,
In Equity.
LENEHAN AND LOO NoAwK, AssIGNEEs OF
LEEoHAT, A BANKRUPT, vs.W. S. AKANA,
AcHo AND An YAU, ALIAS CHANG YAU.

LEEoHAT, A BANKRUPT, vs.'W. S. AKANA,
AcHo AND An YAU, ALIAS CHANG YAU.
Before Chancellor Judd. Opinion Of The Court.
The plaintiffs are asSignees of Lee Chat,
bankrupt
On the 9th Of March 1888, Chang Yau,
small trader in Hilo, after having heard that
Lee Chat, to whom he owed considerable
sum of money, had absconded the Kingdom,
made a chattel mortgage of all his stock of
dry goods, provisions, "and all other goods,
wares and merchandise now in my store on
Front ST., town Of Hilo," to W. S. Akana and
Acho to secure four promissory notes in favor
of Akana amounting to $500 and one in favor
of Acho Of $500. The notes and mortgages
were made payable on demand, and payment
of them all was demanded the next day,
March 2sth. Possession of the goods in the
store was taken by Akana few days later
and sold at auction about month later, the
sale realizing about 81 400. Judgment was
also confessed on these notes by defendant
Chang Yau in the Police Court Of Honolulu
The bill prays inter ala that the mortgage
may be adjudged fraudulent and void as
against the plaintiffs. 1t is in evidence that
Chang Yau, some six or seven months pre-
vious, desiring TO open store in Hilo Dor
rowed $50. Of Akana (whose wife was his
| cousin) TO pay for his retail license, and a
month later Akana advanced him $500 as capi-
tai. About this time All Yau came to Honolulu
and bought goods of Lee Chat and had them
marked in Akana's name. There is some tes-
timony TO theeffect that Akana guaranteed or
became surety for this account, but am not
at liberty TO consider it, for in an action tried
in this Court 70 hold Alzana thus liable was
decided adversely TO this position and 1T is
res ddjudicdtd. Lee Chat continued TO send
goods as ordered to Chang Yau, and received
occasional remittances. After Leo Chat alb
seconded, his assignees in bankruptcy recoy-
cred a Judgment against Chang Yau for 50, :
600 and it is still unsatisfied. Meanwhile
Akana's wife loaned Chang Yau $500. and
Akana paid bill Of $3.50 for lumber used in
fitting up the store.
The amonnt of $500 for which Chang Yau
gave his note to Acho one day before the mort
gage was made, need not be considered, as
Acho was not served with process, being alb
sent in China.r
think il is clear from the evidence in the
case that Akana had reasonable cause 10 be-
lieve that Chang Yau was insolvent when he
took the mortgage upon his stock in trade. Loo
Ngawk testifes that Akana admitted to him
that he knew that Chang Yau owed Lee Chat
over $1,000. Having married his cousin and
allowing him to have his goods sent in his name,
and advancing him money for his license and fol
fitting up his store, il cannot be supposed thai
in a small town where the business was under
his daily observation he could taye been ig-
norant of the condition of Chang Yau's bust
ness. His haste in getting mortgage execu-
ted, made by IFS terms payable on demand, af-
ter he heard that Lee Chat had absconded
L.. ~ Al.
prompt measures would be taken by Lee
Chats creditors TO collect all available assets
his haste in taking possession, closing the
store and selling the goods are to my mind
all iRdicia-o Of fraud. He certainly knew thai
the money he advanced TO pay for license and
for lifting up the store was not invested il
The goods he seized and which realized at an
auction sale more than his whole debt, and
that Chang Yau,was without capital except Al
he supplied it and that the stock Of good
was procured on credit, and that the shor
time a few months) In which he was in bust
ness had not suficed to enable Chang Yau t.
pay his Hopolulu creditor from his profits
! cannot consider him as j bona-fde ppr-
chaser prptesle6 by Tie statuie.s -
Ipass notto another point made BY thI
compliments, The certificate Of acknowledg-
megt tg the alortgage Is a. fOllovs;s
"Hilo, Hawaii
u Hawaiian Isles. O. ..
on this 17th day q March, a. D. iss3 per
sonally appeared before mc---known L
me who acknowledged that he executed Thu
foregoing instrument freely and voluntarily
and for the uses. and purposes therein Sc
forth. Given under myhand and seal
d. II. HITCHCOCK, Notary Public.
The EealTuf the rotary ais not raffxed 70 III
instrnmenl This certificate does not ro'npl.
with tie form prescribed By the Act of I 81.
in that it omits the. substantial par, that tn