Case Name: William Loeschigk, Otto Wessendonck, Gustavus Kutter and Edward Luckenmeyer, Appellants, v. Charles Bridge and Winslow M. Burdick, Respondents
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1870-06-22
Citations: 42 N.Y. 421
Docket Number: 
Parties: William Loeschigk, Otto Wessendonck, Gustavus Kutter and Edward Luckenmeyer, Appellants, v. Charles Bridge and Winslow M. Burdick, Respondents.
Judges: 
Reporter: New York Reports
Volume: 42
Pages: 421–432

Head Matter:
William Loeschigk, Otto Wessendonck, Gustavus Kutter and Edward Luckenmeyer, Appellants, v. Charles Bridge and Winslow M. Burdick, Respondents.
The mere fact of a sale by a person in failing circumstances, upon credit, to one who has knowledge of his circumstances, does not establish fraud. The relations of the parties to each other, the price agreed to be paid, the ■ credit given, and other circumstances, are to be considered in determining the question of fraud; but the finding by the justice at Special Term, that such sale was for a good and valuable consideration, and without any intent to hinder, delay or defraud creditors, having been affirmed at the General Term, is conclusive.
(Argued March 30,1870;
decided June 22,1870.)
Appeal from a judgment entered upon the decision of the General Term of the Supreme Court in the first judicial district, affirming the judgment dismissing the complaint, with costs, rendered on trial before Mr. Justice Leonard without a jury.
The appellants, having recovered judgment against the respondent Bridge, July 13, 1861, for $3,501.39, upon which execution was returned unsatisfied, brought this action to set aside a sale made by Bridge to Burdick, and certain judgments recovered against Bridge by Burdick, as fraudulent.
On the trial the justice found as follows: “ That the plaintiffs duly recovered against the defendant Bridge the judgment mentioned in the complaint, at the time therein mentioned, and execution thereon was issued and returned unsatisfied, as mentioned in the complaint, and that the indebtedness on which said judgment was rendered accrued in September, 1860.
That on the 24th April, 1861, the defendant Bridge sold his entire stock of goods to the defendant Burdick for the sum of $24,072; that on this sale, Burdick paid $1,000 in cash, and gave his notes -for $23,072, payable at an average of sixteen months from date; that at the same time Bridge sold to Burdick bills receivable and accounts for the sum of $30,000 or $35,000, and received the notes of Burdick, payable at twenty-four months and at an average of sixteen months; that at the time of the sale Bridge was unable to pay his debts as they matured, and Burdick was aware of the fact; that Burdick was at the time in the employ of Bridge as his book-keeper; that on the 17th and 24th June, 1861, two judgments, as mentioned in the pleadings and proofs, one by confession and one by offer, were entered in this court in favor of Burdick against Bridge, and execution returned unsatisfied on the 29th June, 1861, and a receiver, under proceedings supplementary to said executions, was appointed; that the plaintiffs commenced their suit for the debt in question on the 22d June, 1861, and that judgments were docketed in the office of the clerk of the county of Blew-York, against the said Bridge, on the 10th, 15tli, 16th and 27th May, 1861, and 1st June, 1861, respectively.
And, as conclusions of law upon the facts, I find that the sale of goods and bills receivable mentioned in the pleadings was not made to hinder, delay or. defraud creditors; was made in good faith, and is valid; that there was no fraud in the sale or transfer of the goods, debts, bills or accounts receivable by Bridge to Burdick; that the defendant Bur-dick was a man of property adequate to an honest purchase, on credit, of the stock, debts and bills receivable, and that. said Burdick has fully met his obligations to pay for said stock; that the inducement to purchase by said Burdick was: to secure himself for his liablities for said Bridge, and said sale and purchase was fair and honest, and for value received by said Bridge. (To this part of the decision the plaintiffs excepted.) That the two judgments in favor of Burdick against Bridge, mentioned in the pleadings, are not fraudu-
lent, but valid. (To this decision the plaintiffs excepted.)That the complaint in this action be dismissed with costs as to the defendant Burdick, and as to the defendant Bridge without costs.” (To this decision the plaintiffs excepted.)
The plaintiffs appealed from the judgment entered upon this decision to the General Term, where it was affirmed, and the plaintiffs appeal to this court.
The facts are more particularly stated in the opinion of Sutherland, J., dissenting.-
William Watson, for the appellants,
urged that the findings were not conclusive, citing Dunning v. Waterman (17 N. Y., 21); Claflin v. Farmers & Citizens’ Bank (25 id.,. 293); Wilds v. Hudson R. R. Co. (24 id., 433); and that the transactions, from their very nature, hindered, delayed and defrauded creditors, citing Webb v. Daggett (2 Barb. 9); Filder v. Day (2 Sandf. S. C., 594); Litchfield v. Pelton (6 Barb., 189); Vance v. Phillips (6 Hill, 433); Cooke v. Smith (3 Sandf. Ch., 333); 8 Johns., 446; 2 Cowper, 434; 7 B. Monroe, 448; 2 Bailey, 324; 1 Hill S. C., 380; 4 Vt., 405.
Samuel F. Lyon, for the respondent,
insisted that there was no evidence from which this sale or the judgments could be declared fraudulent, and cited Lewis v. Palmer (Hill & D. Supp., 68); Henry v. Henry (8 Barb., 588); 1 Bosw., 81; 5 Barb., 291; Seymour v. Wilson (4 Kern., 567); 18 Wend., 353, 365; 8 Johns., 446; 14 id., 439; 2 Johns. Ch., 35; 18 Johns., 515; 21 N. Y., 23; Rose v. Bridge (15 Abb., 150).

Opinion:
Lott, J.
The findings of fact by the judge at Special Term, having been affirmed on appeal by the General Term, are conclusive on tiffs court. They show that the sale by the defendant, Bridge, of his stock of goods, bills receivable and accounts, to his co-defendant, Burdick, was made for a good and valuable consideration, and without any intent to hinder, delay or defraud the creditors of Bridge.
The referee, it is true, also finds that at the time of the gale Bridge was unable to payrhis debts as they matured, and that Burdick, who was his book-keeper, was aware of this fact. Those facts do not jper se show fraud.
Burdick, although occupying the position of book-keeper, is stated to have been a man of property adequate to an honest purchase on credit of the property sold, and that he had in fact, at the time of the trial, fully met his obligation to pay for the stock in trade, and there is nothing found to show that the price agreed to be paid was inadequate. The relations of the parties to each other, the price agreed to be paid, the credit given, and other circumstances of a suspicious character, were proper to be considered by the judge in determining the question of actual fraud, and his decision on the question cannot be reviewed by us.
The mere fact of a sale by a party, even in failing circumstances, of his property to a purchaser having a knowledge thereof, does not show fraud. It may, on the contrary, in many cages, be evidence of good faith and an honest desire to appropriate his means to the discharge of his debts. Such would be a fair inference resulting from the transaction, if the price agreed to be paid is the fair and full value thereof, and there were no other circumstances tending to impeach it.
There is nothing shown in the present case to warrant the court in holding the sale void. The judgment should he affirmed with costs.