Court Opinion

ID: 6556323
Source: CourtListenerOpinion
Date Created: 2022-07-20 18:58:42.385276+00
Date Added: 2024-06-11T15:56:20.114129
License: Public Domain

Boyce, J.:
[1] There is no conflict in the testimony respect-
ing the vital facts of this case. It is conceded that Theodore A. Veasey was the agent of Mary A. Veasey, the defendant, his wife, for the purchase of the lumber and building materials, the subject of this action, from the Delmar Lumber Manufacturing Company of which he was its president at the time of the transaction. Mr. Veasey knew at the time he made the purchase for his wife that his company was insolvent as is shown by his answer to a bill in equity for the appointment of a receiver. He cannot now be heard to deny his knowledge of these proceedings under which the Chancellor upon bill and answer found the said company to be insolvent, and appointed Mr. Veasey one of the receivers. A petition in bankruptcy against the said company was filed within four months from the purchase of the lumber by Mr. Veasey for his wife and the company was subsequently adjudged a bankrupt.
[2] Mr. Veasey’s knowledge of the insolvency of his company must be regarded as the knowledge of his principal, the defendant in this action, according to well settled principles, that a principal is chargeable with the knowledge the agent possesses in the transaction of the business he has in charge. As Mr. Veasey, the agent of his wife and the president of his company, was aware of the insolvent condition of the company, it *592must be charged that he had reasonable ground to believe that in transferring the lumber and building materials from the insolvent company tó his wife in consideration of the credit which was to be given to the company in part payment of the alleged indebtedness due to him from the company that he was preferring himself to other creditors of the company.
[3] It is conceded that in the arrangement between Mr. Veasey and his wife for the payment of the lumber, the wife was; to credit certain evidences of indebtedness due her from her husband. The transaction was therefore voidable, and the trustee in bankruptcy may recover the value of the lumber from the defendant, she being the person under the bankrupt act, deemed to be benefited by the transaction.
In reaching this conclusion, we impute no intention of bad faith on the part of Mr. Veasey, but his act was a preference to himself and a benefit to his principal within contemplation of the bankrupt act and is therefore invalid.
We are constrained for the reasons assigned to instruct the jury to return a verdict for the plaintiff for the full amount of his claim, being the sum of five hundred and one dollars and seventy cents, with interest from July 21, 1912; and, gentlemen of the jury, you are so instructed.
Verdict for plaintiff.