Court Opinion

ID: 3642046
Source: CourtListenerOpinion
Date Created: 2016-07-06 05:59:22.415758+00
Date Added: 2024-06-11T14:08:00.740324
License: Public Domain

The plaintiffs allege that the defendant Austern, by various false and fraudulent contrivances and representations, induced the plaintiffs, who relied solely upon these fraudulent representations, to sell him large bills of merchandise; that after the goods were delivered the defendant Austern fraudulently secreted and disposed of the same, with the intent to defraud, hinder and delay the plaintiffs in the collection of their debts; and that the other defendants, Price  Friedman, conspired and combined with Austern to aid him in carrying           (108) out his fraudulent and corrupt purpose to cheat and defraud his creditors. The complaint further alleges that, in order to consummate their plan to cheat and defraud the plaintiffs, the defendant Austern pretended to confess judgment for large amounts in the Superior Courts of Wake and Vance in favor of the other two defendants, with the purpose and intent of giving to Price  Friedman an unlawful and fraudulent preference over his true creditors, and to have all his property, except his personal property exemption, and such other of his property as he was unable to dispose of secretly, by means of said judgments and executions fraudulently appropriated to their joint use. That immediately after these pretended judgments were confessed, executions upon them were issued, and the property of Austern seized by the sheriffs of Wake and Vance counties.
Upon complaint and answer and affidavits, on a motion for injunction to restrain the defendants, Price  Friedman, from selling under execution the goods of the other defendant, Austern, and for the appointment of a receiver, Judge Timberlake found the facts, granted the injunction until the hearing of the case and appointed a receiver.
The following are the facts found by the Judge:
"The finding of fact dated 16 January, 1896, hereto attached, was signed on this day. The Court, after having signed the same, and sent it to the Clerk of Court of Vance County, on 17 January, as it was written, wrote to the said Clerk for the return of the said finding, for the purpose of correcting the same, being of the opinion, upon reflection, that said finding did injustice to the defendants, and after notice to both parties, makes the following findings as a substitute for the findings of 16 January: *Page 74 
1. That the defendant Austern is indebted to the plaintiffs.
2. That there is such evidence of fraud and the want of the (109) verification of the statement authorizing the entry of judgment as presents a proper case for holding his property in the custody of the Court until the final hearing.
3. That the defendant Austern has no property in this State subject to execution, except that described in the pleadings as in the hands of W. H. Smith, Sheriff of Vance County, under levy of execution in favor of M. Price and B. Friedman against L. Austern.
4. That on 17 December, 1895, the defendant Austern attempted to confess judgment in the Superior Court of Vance County in favor of M. Price and B. Friedman for amounts aggregating about $4,000, as per copies attached to the complaint, with the intent and purpose to give a preference over their other creditors.
5. That defendants Price  Friedman are non-residents of North Carolina, and are attempting to enforce the collection of said confessed judgments, undertaking to have the property of Austern sold, and to take the proceeds outside of the State.
6. That after issuing the restraining order herein, and before the service, the sheriff of Wake County, under execution upon the confessed judgments, levied on the property of Austern in Wake County and sold the same to Price  Friedman, who still have the property or proceeds."
The exceptions to the findings of fact are made on the ground that they "are not sustained by the affidavits filed." Upon examination of the complaint, treated by the Judge as an affidavit, and the other affidavits filed in the cause, it appears that there was evidence before his Honor going to show the facts which he found. The complaint, the affidavit of T. M. Pittman, the answer of Austern, and the affidavit of Jordan Thompson, Pegram and Williams, contain evidence of (110) the matter embraced in his Honor's second finding of facts. The complaint, the affidavit of Pittman and the answers of each of the defendants furnish evidence of the matter embraced in the fourth finding of the facts. The complaint and answers of the defendants furnish evidence upon which his Honor properly found his fifth finding of facts. The affidavit of Pittman and the amended answer of Austern contain evidence upon which his Honor properly made his sixth finding of facts. The affidavit of Pittman especially authorized this finding. That affidavit contains the statement that at the execution sale of Austern's property by the sheriff of Wake County, the defendants Price  Friedman became the purchasers, that the sheriff delivered to them the property, and they received it as so much cash on their judgments and executions, and that the goods or the proceeds were in their hands at the hearing of the injunction. *Page 75 
There was no attempt at denial of these statements made concerning the matters embraced in the sixth finding of facts in the answers or in the affidavits of the defendants. A general exception was made to the order made by his Honor in the cause. There can be no reasonable doubt but that upon the facts found in this case a receiver should have been appointed under subdivision 1 of sec. 379 of The Code. The defendants Price 
Friedman were ordered to turn over to the receiver the goods and the proceeds of any portion of the property that the defendants had disposed of. This was clearly proper. If the judgments and executions are fraudulent and feigned (and there was proof of it before his Honor), then the sale under the executions was void as to the defendants, who were purchasers and parties to the proceeding in which the judgments were confessed, and the property is still the property of the defendant Austern, and ought to be delivered to the receiver.
No error.
(111)