Case Name: Parker et al. v. Tapscott et al.
Court: Mississippi Supreme Court
Jurisdiction: Mississippi
Decision Date: 1926-01-25
Citations: 142 Miss. 768
Docket Number: No. 25290
Parties: Parker et al. v. Tapscott et al.
Judges: 
Reporter: Mississippi Reports
Volume: 142
Pages: 768–783

Head Matter:
Parker et al. v. Tapscott et al.
(Division B.
Jan. 25, 1926.
Suggestion of. Error Overruled April 5, 1926.)
[107 So. 561.
No. 25290.]
Leftwich dt Tubb, for appellants.
W. A. Blair, for appellees.
E. 0. Sykes, for appellant, on suggestion of error.
W. A. Blair and Frcmcis S'. Harmon, for appellees, answering memorandum from the court in response to suggestion of error.
E. O'. Sykes, for appellants, answering memorandum from court on suggestion of error.
Argued orally by G. A. Tubb, for appellants.
Corpus Juris-Cyc References: Appeal and Error, 4 CJ, p. 946, n. 10. Equity, 21 CJ, p. 516, n. 17; p. 517, n. 24. Fraudulent Conveyances, 27CJ, p. 875, n. 36, New; p. 882, n. 20; p. 891, n. 95; Statutory requirements on sale of stock of goods in bulk, see notes in 2 L.R.A.(N.S.) .331; 20iL.R.Á. (N.S.) 160; L.R.A. 1915E, 917. 12 R.C.L., p. 525; 2 R.C.L. Supp., p. 1443; 4 R.C.L. Supp., p. 7.61; 5 R.C.L. Supp., p. 649.

Opinion:
Holden, P. J.,
delivered the opinion of the court.
The appellants filed their bill against the appellees to cancel the transfer of a certain stock of goods, alleged to have been fraudulently transferred by appellee Tapseott to Miss Eosa Young; that the sale of the goods was wrongful, and was pretended and resulted from a conspiracy on the part of the parties to defeat appellants in the collection of a certain judgment they had against Tapseott. After a full hearing of the facts, the chancellor decided the transfer of the goods in the store was in good faith and valid. Prom this decree the appeal is prosecuted.
The pleadings and proof in the case went upon the theory that the sale of the stock of goods was a sham, and was for the purpose of defeating the collection of a judgment due appellants. In other words, the complainant prosecuted his cause on the ground that the appellee, Tapseott, had fraudulently transferred his interest in the stock of goods, so that his creditor, the appellant, could not levy against'the goods to satisfy a judgment for about one thousand five hundred dollars.
After all the evidence had been heard by the chancellor on the issue of whether or not the transfer of the stock of goods was fraudulent, without consideration, and was for the purpose of defeating the judgment of the appellant, and while the arguments of counsel were being-made to the court, the question of whether our Bulk Sales Statute ('Hemingway's Code, sections 3129-3132) was involved in the case arose on motion before the. chancellor. Up to this time the Bulk Sales Statute had not been specifically mentioned in the case by the pleadings or the proof. At this juncture of the trial, which was practically over, except a part of the argument was yet to be heard, the appellant moved the court for permission to amend his bill, so as to charge that the Bulk Sales Statute had been violated, and that the sale of the stock of goods should, for that reason, be canceled.
Objection was made to tbe amendment, and the court sustained the objection, upon the ground that the bill did not charge a violation of the Bulk Sales Statute, and that to allow the amendment at that stage of the trial would be to change the character of the lawsuit, and require the defendant to meet a case which the pleading did not present. The appellant contends that under the allegations of his bill it was proper for him to show a violation of the Bulk Sales Statute without having alleged its violation, and that the proof offered was sufficient to bring the case within the statute; but that, if mistaken in this, that then the court erred in not allowing him to amend the bill, so as to come within the Bulk Sales Statute.
We are unable to agree with the contention of appellant. The pleadings and proof do not bring the case within the Bulk Sales Statute, nor was the cause tried upon that theory. It is clear from the record that a violation of the Bulk Sales Statute had not been expressly presented until the case was closed and the argument begun before the chancellor, when the statute was mentioned for the first time. The cases cited by appellant were brought under the Bulk Sales Statute. It was within the discretion of the chancellor to refuse to allow the complainant to amend his bill at the close of the trial, and we see no abuse of discretion in that regard. Griffith's Mississippi Chancery Practice, section 393, chapter 403, and cases cited therein.
The appellant was an individual creditor of the appellee. The debt claimed was not for goods sold to the appellee partnership, but was a judgment for an individual claim against appellee. We do not decide whether the Bulk' Sales Statute is applicable to individual creditors, because it is unnecessary to do so in the case before us. The decree of the lower court is affirmed.
Affirmed.
On Suggestion of Error.
Ethridge-, J.
We are of opinion that the bill of complaint in this case did not allege a case within the Bulk Sales Statute. Chapter 100, section 1, Laws 1908; Hemingway's Code, section 3129. The allegations of the bill with reference to the stock of goods is as follows:
' ' Complainant respectfully represents that the said C. A. Tapscott was, at the time of the filing of the said bill, the owner of a large stock of merchandise and a store which he was conducting at the town of Nettleton, at the time buying and selling large quantities of goods, the sole owner of the same, as your complainants are informed and believe, and that he so remained until very shortly before the final trial of said cause, when to defeat your complainants in the collection of their just obligation, and defeat the collection of the decree, which they were then certain to recover against him in right and justice, wrongfully and fraudulently pretended to sell, make over, and transfer to Miss Rosa Young, his sister-in-law, the pretended ownership and control of said stock of goods and store, though the said C. A. Tapscott all the while remained and still remains in management of the said business, and your complainant charges on information and belief that he is still in equity and good conscience the owner of the same."
The statute (section 3129, Hemingway's Code; Laws 1908, chapter 100, section 1) provides that a sale of any portion of a stock of merchandise, otherwise than in the ordinary course of trade, or in the regular and usual prosecution of the seller's business, and a sale of an entire stock of merchandise in gross, shall be presumed to be fraudulent and void as against the creditors of the seller, unless, at least five days before the sale, (a) the seller shall have made a full and detailed inventory, showing the quantity, and, so far as can be done by the exer cise of reasonable diligence, the cost price to him of each article sold; and (b.) the purchaser shall have in good faith made full and explicit demand of the seller for the name, place of residence, and business and post office address of each of his creditors, and the sum due each, and to which demand the seller shall have made full and truthful written answers; and (c) the purchaser shall have in good faith notified personally or by mail each of the seller's creditors, of whom he has knowledge or with the exercise of reasonable diligence could have acquired knowledge, o.f the proposed sale, and of the cost price of the merchandise proposed to be sold, and of the price to be paid therefor by the proposed purchaser.
This statute is in derogation of the common law and of the right to contract, and to bring a case' within the statute the proposition which makes the sale fall within the statute should be averred, showing in substance the failure of the seller and purchaser to comply with the statute. The allegation as made is one of the ordinary fraudulent conveyance or creditors' bill allegation, and does not aver the failure of the defendant to comply with the statutory requirements. We think good pleading requires the pleader to set forth with sufficient certainty and clearness the facts constituting violation of this section, and that the court did not err in holding that the case made was not within the fraudulent sales of merchandise statute, supra.
It is also insisted that we erred in holding that the court did not commit error below in refusing to permit complainant to amend the bill after the evidence was closed in the court below. While ordinarily a party will be permitted to amend his bill, so as to conform to the case made by the evidence, still it is not reversible error to refuse to permit the bill to be amended, when the statute would not be applicable to the case, were the bill properly amended, so as to allege a violation of the statute.
In . our opinion the statute does not apply to a sale of a stock of merchandise from one partner to another, and therefore that the court below did not err in refusing the amendment. The suggestion of error will therefore be overruled.
Overruled.