S. ELLSASSAR v. ALEXANDER HUNTER and A. J. LOWRY, 26 Cal. 279

By the Court, Currey, J. This action was brought to recover damages for the alleged wrongful taking of the goods and chattels of the plaintiff by the defendants and converting the same to their own use. In answer to the complaint the defendants say, at the time of the commission of the -wrongs and injuries complained of, the defendant Hunter was Sheriff, and the defendant Lowry was Deputy Sheriff of El Dorado County, and that by virtue of a writ of execution issued upon a judgment obtained by M. O’Connor against D.

Hewbauer for a large sum of money specified, they levied upon and siezed the property described in the complaint as the property of said Hewbauer, and they aver that the same was his property and liable to be seized for his debts.

The answer also charges that while Newbauer was indebted to O’Connor, he made pretended sales and transfers of his personal property to the plaintiff, for which no consideration was paid, and that such pretended sales were made to hinder, delay, and defraud O’Connor in the collection of the debt due him, of which intent the plaintiff had knowledge ; that the property so transferred by Newbauer to plaintiff was sold by the latter, and with the proceeds thereof and other funds of Hewbauer, other goods and chattels were purchased by the plaintiff in his own name, but in fact for Hewbauer, and that they claimed and pretended that the property thus acquired belonged to plaintiff for the purpose of hindering, delaying and defrauding Newbauer’s creditors in the collection of their debts.

Other transactions of like character are set forth in the answer implicating Newbauer and the plaintiff, and other persons co-operating with them in a con- ■ spiracy to defraud Newbauer’s creditors by other pretended sales and transfers of the goods and chattels of Newbauer, and by procuring the institution of actions for ficticious debts against him and the seizure and sale of his property on judgments suffered in such actions.

The defendant Hunter also, by a separate answer, alleged that Newbauer applied to the County Court of El Dorado County to be discharged as an insolvent from his debts, and that he, as the Sheriff, was appointed his assignee in insolvency, and that such proceedings were had in the insolvency case that Newbauer was discharged from his debts ,• and he then charges that Newbauer was, at the time of his discharge, the owner of the property on account of which this action was brought, and omitted to surrender the same to him as such assignee; but that afterward the same property came to his possession under the execution issued on the judgment in the case of O’Connor against Newbauer, and having thus obtained the possession he claimed to hold the property by virtue of the assignment, in trust for the creditors of Newbauer.

The issue joined between the parties was tried before the Court and a jury, and a verdict was rendered for the plaintiff, on which judgment was entered. On motion of the defendants the Court “ ordered that all proceedings be stayed for twenty days, with leave to defendants to file papers herein.” Twenty days afterward the defendants filed and gave to the plaintiff’s attorneys notice of a motion for a new trial. Sometime subsequently the Court passed upon the motion, denying the application for a new trial. From this order and from the judgment the defendants have appealed.

The counsel for the respondent makes an objection that the notice of motion for a new trial was not filed and served until twenty days after the verdict and judgment were rendered, and therefore the right to move for a new trial wás waived. This objection is well taken, which carries with it the statement prepared and filed as on motion for a new trial. (Prac. Act, Sec. 195; Flatau v. Lubeck, 24 Cal. 364; Bear River and Auburn Water and Mining Company v. Boles, 24 Cal. 354.) This statement being rejected, the case stands to be decided on the judgment, and the matters properly of record.

By a bill of exceptions taken at the trial and signed by the Judge, it appears that the defendants, who are now the appellants, offered to prove that Newbauer was in the months of September, October, and November, 1861, the owner and in the possession of a large amount of goods, wares and merchandise— and in the last named month transferred the same in trust for himself to the plaintiff; that the plaintiff sold the same goods and used the proceeds thereof in purchasing the goods in controversy for Newbauer.

Also, the defendants offered, to prove that in the same month of November New'bauer was the owner of a large amount of goods, wares and merchandise, which he transferred to one Glanber without consideration, with the understanding that Glanber should transfer the same to the plaintiffs; that Glanber afterward transferred said goods to plaintiff, who sold the same and applied the proceeds in the purchase of the goods in controversy. And, further, the defendants offered to prove that the money used in the purchase of the goods in controversy belonged to.

Newbauer, and that such money had come into plaintiff’s possession from sales made by him of the property of Newbauer, for whom he acted therein. The plaintiff objected to the evidence offered to prove these facts, on the grounds : First—That it was irrelevant and immaterial. Second—That it was incompetent. Third—That it was an ofier to again litigate the matter shown to have been tried and determined in the case of Newbauer against His Creditors—which determination or decree, it was alleged, the defendants could not attack collaterally.

The Court sustained the objection and the defendants duly, excepted, and this ruling of the Court is assigned as erroneous. The several matters sought to be proved by the defendants were set forth in the answers and were relevant and competent evidence, unless barred by the decree discharging Newbauer as an insolvent debtor. And the only question to be decided is as to the effect of this decree as pleaded. The rights and immunities to which an insolvent debtor is entitled under a decree discharging him from the payment of his debts, depend for their foundation upon the provisions of the statute entitled “

an Act for the relief of insolvent debtors and protection of creditors,” (Laws, 1852, p. 69), and the effect of the decree in such case is subject to the qualification comprehended in the thirty-second

section of that Act, which reads as follows : “ Whenever any insolvent debtor has had the benefit of this Act, if thereafter, at any time, it is made to appear that he has concealed any part of his property or estate, or given a false schedule, or committed any fraud under the provisions of this Act, it is hereby declared that he has forfeited all benefit and advantage which he would otherwise have had by virtue of this Act, and he cannot avail himself of any of its provisions in bar to any claim that may be instituted against him.” The transactions of which the defendants proposed to prove that Newbauer had been guilty, with the co-operation of the plaintiff and others, for the purpose of defrauding his creditors, were of a grossly base and fraudulent character, and if true as charged, in any essential particular, should forever bar him of all benefit and advantage which, by an honest surrender of his property, he would have been entitled to b.y virtue of the Act for the relief of insolvent debtors.

This Act was not designed alone for the relief of insolvent debtors, but it was also intended, as its title suggests, for the protection of creditors, and this protection the

section of the Act quoted conserves to the creditors notwithstanding the alleged insolvent debtor may have obtained a decree discharging him from the payment of his debts. The judgment is reversed and a new trial ordered. Mr. Chief Justice Sandebson, being disqualified, did not participate in the decision of this case.