, 1892-03-09
SEIZURE.
Concluded from Yesterdays edition.

OF a Vendee, who, by fraud, induced the
sale, cannot hold the property under pro-
eeeding to enforce their debt against the
vendors In Root VS.. French, Is Wendell
$40, it was held that the fraudulent pur-
chaser OF goods acquires no title as against
rthe vendor, and has no interest which can
be seized on execution. Andin Donaldson
VS.. FarWell 3 Otto 631, the supreme court
of the United States held that when a
party, by fraudulently concealng his in
solYency and his intent not to pay for the
goods, induces the owner to sell them to
him on credit, the vendor, if no innocent
third party has acquired an interest in
them is entitled to disaffirm the sale and
recover the goods. In that case the vendor
disafirmed the sale and held the goods,
which were claimed by the assignee in
bankruptcy of the fraudulent purchaser.
See also Nanfactuck Cutlery Co. VS.. Bah
cock, p Hun 485; Field. Morris & Co. VS..
Stearns, 40 vt. 1906; DeVoe VS.. Brandt, So
n. Y, 464; Burlington vs.. Gerrish, Is Mass.
156; Wafee VS.. Harry County bank 26 Pac.
Rep. (Kas.) 1882; Cobbey on repleVin, Sec.
285.
In view Of the above authorities, and
many others that might be cited, we are of
the opinion that the respondents were en-
titled to disaffirm the sale for fraud after
the levy of the execution.
The objection that there is a defect of
parties is untenable. The sheriff being in
possession Of the property, was the only
necessary defendant in the action. See
Cobbey on repleyin, secs. 436, 437; Willis on
repleyin, sec. 1874.
This cause was tried by the court with
out jury, and it is objected that the evi-
dence is insufficient to justify the findings
of facts; that there was no proof that
White did not intend to pay for the goods,
and that mere insolvency of the vendee
with no reasonable expectation of being
able to pay, is insufficient to authorize the
resciSsiOn of a sale of goods upon credit by
the vendor.
The court found, among other things,
that at the time White purchased the
goods, and prior thereto he fraudulently
represented to plaintiffs that he was sol
vent, able to pay for the same, ard that he
was buying his goods for cash and dis
counting his bills; that said goods were
purchased from plaintiff by said White
upon credit of four months with an
agreement and understanding between
said parties that the bills for said goods
We're to be discounted on the 1st of Jam
uary, 1891, at discount Of six per cent.
That plaintiffs relied upon the fraudulent
representations of said White, that he was
solvent and able to pay for said goods and
that he was dlscountlng his bills, and upon
such fraudulent representations, SO made
and erlied upon, they sold him said goods
and plaintiffs were not aware that said rop-
RESERVATIONS were frauduled4 and false, but
believed the same to be true, and, upon the
ldlbl GIl6IGOlJ DdTGGU Will G4G POSSESSION OIL
said goods, and agreed to give said White
a credit of four months, upon the agree
ment made at the time; that said White
would discount the bills for said goods !;
that at the time White made said fraud
ulent representations, and at the time he
obtained possession of said goods from
plaintiffs he was lnsOIYent and unable to
pay for said goods, which he then and
there well knew, which insolvency was con
cealed from the plaintiffs. and that he had
no reasonable expectation of paying for the
gOons, and did not intend to pay for them
We think there is sufficient testimony to
support these findings. The agent or tray
cling salesman of the plaintiffs testified, in
substance, that he visited White at his place
of business some time in May, 1890, with a
view of selling him such goods as he might
desire to purchase; that White informed
him that he did not wish to purchase any,
thing from him at that time, but that he
would like to do so when he got ready to
move into his new store; that White told
him he was buying goods for cash and was
discounting his bills, and that an
arrangement was made between them
whereby White was to inform him
by letter when he wished to
purchase, and he was to have his princi
pals send memorandum bill of goods
from which a selection should be made by
White Of such as he DESIRED that in aceor-
dance with this arrangement White wrote
AlI1l d 1CGGSI Ii AllSUSb 4IllOI1nlIlS HIN
he was ready to receive the goods; that he
forwarded the letter to plaintiffs and at the
same time advised them to ship the goods
which was done, and that they were re-
ceiYed by White the last of October The
witness was in Seattle on the 31st day Of
October and charged upto White the goods
selecred by him from the memorandum
bill, and on November 4th and 9Th, deliv-
cred the remainder of the goods sold to
White. This witness further testified that
at the time Of the delivery of the goods, he
asked White if he would pay cash, and the
latter responded that he would discount
the bill on the LIST of January but desired a
credit of four months, which was finally
agreed to.
None of this testimony was contradcted
by White. But the witness also testified
that at the cine when the arrangement
was made In May, whereby the goods were
to be sold to White, the latter expressly
stated to him that he did not owe any one
and that he paid cash for the goods he
bought, and that when the goods were de-
hvered he again stated that he paid cash
and discounted his bills and that be relied
upon these statements, believed them to be
true and delivered the goods accordingly.
White denied making the statement that
he owed no one, but admitted that when
the arrangement above mentioned was
made, and also that when the goods were
delivered, he did state that he was paying
CttSn lOI IIlG SOOQS liz Was DllY ing, ana WAS
disGounting his bills, and that he promised
to discout plaintiffs bill on the first OF
January.
1t further appears from Whites own tes-
timony that in May his indebtedness
amounted toseyen thousand dollars, which
was equal to or greater than the whole of
his assets, that his indebtedness was oflong
standing, that his business was small, and
so continued during the summer, and that
at the time plaintiffs delivered the goods
in question to him his indebtedness had
been increased by further purchases Of
goods and expenses incurred in fitting up
his store to about double the sum. it was in
Map. He was also in arrears for rent and
owed his employees for labor, and very
great proportion of his large Indebtedness
was then due and the balance would be.
come due in short time. His entire stock
Of goods, at invoice prices, was not equal tc
the amount OF his Indebtedness. And
thus situated, he purchased and received
the goods OF plaintiff and promised to pay
for them within two months, and moi
later than four months, but failed to make
known to them his financial condition
He must have known when he received
these goods that he could not continue ii
business and pay for them, and the fac
that he confessed Judgment upon oldel
debts, SO soon afterwards is strong evidence
that he did know it; and this being so ht
is chargeable with the intent of not pay
ing. 1t is true that White testified that ht
purchased the goods in good faith and hon
estly intended to pay for them But W,
think, in view of the whole evidence il
the case, we would not be justified in re
Yersing the judgment of the court below
We do not dispute the contention 0
counsel for appellant that the mere fac
that White was insolvent at the time HI
purchased the goods does not prove tina
he did not intend to pay for them, or thati
mere failure to disclose insolvency WoulC